EUR/USD firmer, approaches 1.0700 ahead of NFP
The persistent decline of the greenback has allowed EUR/USD to extend its weekly advance to the vicinity of 1.0700 the figure.The pair is advancing for the second consecutive week so far, putting further distance from last week’s fresh 2016 low at 1.0515 following the continuation of the offered bias around the buck.The absence of subsequent tests of the area of recent troughs prompts investors to think that an interim low could be in place, allowing the likeliness of occasional bullish attempts.Data wise in Euroland, Producer Prices for the month of October are only due, while the US labour market figures will grab all the attention. Prior surveys expect the economy to have added 175K jobs during November, up from October’s 161K.The pair is now up 0.23% at 1.0683 and a break above 1.0700 (23.6% of the November drop) would target 1.0820 (low Mar.10) en route to 1.0848 (low Oct.25). On the flip side, the immediate support aligns at 1.0515 (2016 low Nov.24) followed by 1.0457 (2015 low Mar.16) and then 1.0332 (monthly low January 2003).
GBP/USD regains poise, 2-month tops eyed ahead of PMI?
The GBP/USD pair is seen on a stronger footing so far this Friday, looking to extend Thursday’s advances on the back of a broadly weaker USD and renewed hopes of a Soft Brexit landing.The cable found renewed bids near 1.2570 region and from there took on the recovery on 1.26 handle, in a bid to retest two-month highs reached yesterday at 1.2696 levels.The pound regained strength post-Tokyo open, as the greenback remains broadly sold-off into a profit-taking spree after upbeat US ISM PMI inspired solid rebound.While the Asian traders also cheered optimistic comments from the UK Brexit Minister Davis and EU Group President Dijsselbloem, which indicated that it was possible for the UK to maintain access to the European Union’s single market, and hence, re-ignited Soft-Brexit hopes, bolstered the cable.Next of note for the spot remains the UK construction PMI release, which will be closely eyed, especially after yesterday’s disappointing UK manufacturing PMI reading. While the main risk event for today remains the US payrolls data due on the cards in the American morning.In terms of technical levels, upside barriers are lined up at 1.2650 (psychological levels), 1.2675 (Nov 11 high) and 1.2696 (Dec 1 high). While supports are seen at 1.2596 (daily pivot) and 1.2525 (5-DMA) and below that at 1.2490/80 (10 & 20-DMA).
USD/JPY turns neutral at 114.00 mark, awaits NFP for fresh impetus
Having posted a session low at 113.58, the USD/JPY pair managed to recover early lost ground and has now tipped back above 114.00 handle.Amid prevalent risk-off mood, a tepid late recovery in the Japanese benchmark index, Nikkei 225, could be the primary reason attributed to the pair's recovery. Moreover, traders refrained from carrying big bets, heading into the important jobs report from the US, and could have also contributed to the pair's recovery from session low.Looking at the broader picture, the pair remains closer to Thursday's 9-month high and hence, the prevalent price-action could be categorized as consolidation following the pair's post-US election sharp up-surge of over 1300-pips. Going forward, broader market risk sentiment would continue to be a key driver for the Japanese Yen's safe-haven demand ahead of NFP release later during NA session.From current levels, 114.40-45 region might restrict any immediate upside, which if conquered is likely to trigger a sharp up-move immediately towards 114.83 (yesterday's high) en-route 115.00 psychological mark. On the flip side, weakness below session low support near 113.60 region is likely to accelerate the slide towards 113.40-35 horizontal support below which the pair is likely to drift back towards 113.00 round figure mark.
USD/CAD around 1.3300 ahead of key data
The Canadian dollar remains on a firm footing vs. its American neighbor at the end of the week, sending USD/CAD to test the area of 1.3300 for the time being.The post-OPEC rally in crude oil prices has taken the barrel of West Texas Intermediate to fresh tops near the $51.00 mark on Thursday, although easing some ground afterwards and hence removing some tailwind from CAD. Anyway, spot remains firm on its way to close the week with losses, reverting previous gains and navigating the area of 3-week lows at the same time.Adding to the recent bearish note around the pair, the greenback continues to surrender earlier gains despite recent auspicious releases in the US docket, with the ISM Manufacturing surprising investors to the upside during November.Later in the day, labour market reports in both Canada and the US will take centre stage along with speeches of FOMC’s L.Brainard and D.Tarullo.As of writing the pair is retreating 0.03% at 1.3312 and a breach of 1.3287 (low Dec.2) would open the door to 1.3260 (low Nov.9) and finally 1.3185 (100-day sma). On the other hand, the next hurdle aligns at 1.3442 (20-day sma) followed by 1.3542 (high Nov.28) and then 1.3566 (high Nov.18).
EUR/GBP sinks to 3-month lows near 0.8400
The solid performance of the Sterling is dragging EUR/GBP to test fresh multi-month lows in the 0.8400 neighbourhood.The European cross has come under renewed and strong selling pressure today following a solid demand for the British Pound, particularly via a higher GBP/JPY and after shorts continue to be triggered above 1.2600 the fIgure in GBP/USD.EUR/GBP is retreating for the fifth consecutive session so far after breaking below the multi-week consolidative pattern around the psychological 0.9000 handle seen in late October, all in response to the rejection from highs post-‘flash crash’ near 0.9400 the figure.In the data space, UK’s manufacturing PMI has missed consensus during November, while PMIs in Euroland have come in mixed during the same period and the unemployment rate in the region ticked lower to 9.8% in October. The cross is now losing 0.56% at 0.8421 and a breakdown of 0.8329 (low Sep.6) would expose 0.8277 (200-day sma) and then 0.8248 (low Jul.14). On the flip side, the immediate hurdle lines up at 0.8582 (high Nov.30) ahead of 0.8610 (20-day sma) and finally 0.8710 (high Nov.15)
GBP/JPY recovery capped below 144, UK PMI ahead
The cross in the GBP/JPY is seen struggling to extend the recovery from near 143 handle as we head into early Europe, as markets now look forward to the UK construction PMI report for fresh impetus.Currently, GBP/JPY trades modestly flat at 143.74, unable to chew offers placed at daily pivot (143.83). The pound remains better bid against its Japanese peers in the early European morning, as the GBP bulls continue to cheer comments from the UK’s Brexit minister Davis delivered yesterday, which refueled hopes of a ‘Soft Brexit’. Mr. Davis noted that it was possible for the UK to maintain access to the European Union’s single market.However, the recovery lacks follow-through on the back persisting weakness around USD/JPY, as the buck continues to correct lower against its main rivals ahead of the much-awaited US NFP report due later on Friday. In the meantime, focus remains on the UK construction sector activity report due later in the European session.The pair has an immediate resistance at 144.50 (psychological levels), above which 145.09 (daily R1) could be tested. On the flip side, support is seen at 142.93 (daily low) that at 142.39 (daily S1).
Oil: OPEC returns, but be wary - Natixis
Research Team at Natixis, believes that the outcome from the OPEC meeting is positive even though some gaps remain and we will need to wait until the OPEC nonOPEC meeting to bridge some of those gaps.“Whilst markets grow bullish on the back of this news, we might also see some correction in prices, especially if the effective cut is not as high as announced by OPEC and non-OPEC. This will become visible in late January or February. At the same time, even if the effective cuts were not exactly similar to the ones announced by OPEC alone or together with non-OPEC, we think that the news today will provide a tailwind for oil prices to take them through the most fundamentally weak quarter, which is 2017Q1 in our view. Once we are past that, markets might start to look beyond the first quarter and we see markets trending towards a natural equilibrium thereafter anyway, even without the intervention.”“An oil price rally on the back of this meeting will nevertheless encourage supply demand auto-correction demand on the sustainability of the rally. On the supply side, we expect US producers, in particular, to take advantage of this rally (at different levels; USD50/bbl for some and USD60/bbl for others, on a sliding scale) to hedge and hence return more rigs on line. Additionally, a rapid oil price rally would also impact demand growth. This may alter the supply demand balances, but we still expect markets to trends closer to equilibrium and witness stock withdrawals in 2017.”
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