Non-Farm Payrolls grew by 156,000 jobs in December. This was a print that missed the 175,000 expectation, but any negativity here was overshadowed by a sharp gain in wages:
USD Average Hourly Earnings m/m: 0.4% v 0.3% expected.
USD Non-Farm Employment Change: 156K v 175K expected.
USD Unemployment Rate: 4.7% v 4.7% expected.
Traders have taken this as an extremely hawkish sign for the Fed, being described as possibly the final piece of the labour market recovery puzzle, removing any final hurdle from the Fed stopping them from increasing interest rates through 2017.
As a result, the US dollar bounced strongly, highlighted in the USD/JPY chart below:
USD/JPY Daily:
The more we talk about this USD/JPY level, the more apparent it becomes that the move is localised to the JPY pairs, as we’ve seen with the AUD/JPY trade ideas on the blog most recently too.
For me, the USDX chart still has price sitting in a but of no man’s land between support and resistance levels, so isn’t worth posting. Check out the USDX triple top post from the end of December to see the major levels and where we are currently sitting in relation to these.
It’ll be interesting to see how high the pair can get before USDX hits that quadruple top resistance level but new highs are surely on the cards as we head through this week.
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