Forexpros Daily Analysis - 01/04/2010
ForexPros Daily Analysis April 1, 2010
Fundamental Analysis: Nonfarm Payrolls
Traders of the US anticipate the publication of the Nonfarm Payrolls. The payroll measures the change in the number of employed people during the last month of all non-farming businesses. The total non-farm payroll accounts for approximately 80% of the workers who produce the entire gross domestic product of the United States. It is the single most important piece of data contained in the employment report, which considered to offer the best overview of the economy. The monthly changes and the revisions in payrolls can be quite volatile. A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD. Analysts predict a future reading of 190.00K.
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Euro Dollar
The Euro broke the resistance specified in yesterday’s report 1.3441 and reached the first suggested target 1.3551 successfully, stopping only 8 pips above it. . The collapse which happened late last week is completely expected, not only that, but we believe what we have seen yet is just part one of a strong and massive medium term drop which has already started! We will not be a bit surprised when we see the Euro below 1.30 in the near future, on the contrary, we look forward with eager to that. But after dropping from 1.38 to 1.32 in a few days, a rising correction is normal & logical thing and holds no surprises. Thus, we should focus of the projected targets for this correction, the most important of which is the Fibonacci 61.8% resistance at 1.3606. Adding importance to this level is the fact that the long term descending trend line has finally touched the Fibonacci level. The possibility of forming a medium term top between the current price & 1.3606 is getting larger by the minute. Thus we do not recommend taking a positive attitude towards the EURUSD ahead of 1.3606, and we also recommend to be on the watch for any indications that a medium term top is forming in the neighborhood. Short term resistance is 1.3606, breaking it would indicate a jump to 1.3703 and then 1.3794. Short term support is at 1.3494, breaking it would frustrate the Euro and send it to 1.3394 & may be 1.3283.
Support:
• 1.3494: Asian session low.
• 1.3394: the bottom of the rising channel on 1.3266 on hourly charts.
• 1.3283: Thursday’s low.
Resistance:
• 1.3606: Fibonacci 61.8% for the drop from 1.3816.
• 1.3703: Mar 8th high.
• 1.3794: Mar 12th high.
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USD/JPY
Dollar-Yen traded below 93.75 for the whole past 24 hours, settling for a nearby top at 93.63. But, as we approach the important top 93.75, we recommend caution of a possible drop. Since it is pretty important, we will take 93.75 to be our “resistance of the day”, and we do not expect this “correctionless” rise to continue unless it is broken. But if it does, the price will jump above 94 for the first time since August, targeting 94.35 and may get a taste of 95 as it targets 95.05. As for the support it is at 93.00, and breaking it would mean that the price has settled for a top at 93.58, for the time being at least, and that we will now correct the big rise we just saw. If this break takes place, we expect the Dollar to fall strongly targeting 92.13 first, and may be 91.53 afterwards.
Support:
• 93.26: the rising trend line from 92.10 on hourly charts.
• 92.13: Feb 19th low.
• 91.49: Fibonacci 38.2% for the rise from 88.12.
Resistance:
• 93.75: Jan 8th high.
• 94.35: Aug 4th low.
• 95.05: Aug 24th high.
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Forex Trading Analysis written by Munther Marji for ForexPros.
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