Currencies
EUR/USD – fell sharply due to the NFP, but managed to correct quite a bit of the drop in the hours afterwards (nearly half of the move). The strong NFP is definitely causing some more risk taking and also a higher demand for the USD, as it brings the likelihood for an interest rate hike by the FED this year squarely back on the table.
USD/JPY – up until a few days ago it looked like we would see a test of the 100 level, but we have moved 200 pips away from this on the last 2 trading days. In large part obviously due to the strong NFP on Friday.
GBP/USD – is trading at the lowest level in nearly a month thanks to the BOE decision to cut the interest rate and increase QE on Thursday and the strong NFP on Friday. For now the 1.30 level appears to be holding, but we have more important data coming mainly on Tuesday and Friday, so things should remain interesting.
USD/CAD – firmly broke through the1.312 level after the strong NFP and the weak employment data out of Canada. We are still trading below the resistance of the 1.32 and 1.329 level, and it looks like we need a further drop in oil in order to test those levels.
Indices
S&P 500 – reached a new record high as the US economy is showing that is still in good shape, with employment numbers that are strong.
Commodities
Gold – the strong NFP was most seen in gold and we saw a large drop of $30. This means we will need to wait a while until we will reach a new 2 year high. The NFP is bringing the possibility for a rate hike back on the table, with some already seeing September as a possibility. It is still too early, to mark September as a good possibility, but we can definitely say that the labour market appears to be in good shape, especially since wages also increased.
Oil – moved down after the NFP strengthened the USD, but subsequently corrected the losses to close a bit higher, slightly under the 42 level. This comes even though we saw yet another increase in the number of active rigs. We are starting to trading closer to the downwards trend line where likely the next test will be.