AUDUSD: The Australian dollar declined Friday on a resumption of European jitters ahead of a key report on the U.S. job market later in the global day.
After gaining for much of the start of 2011, the local unit has faced some pressure in the past two sessions. Aside from hitting the Australian dollar, the renewed European concerns weighed on equities across the world and lifted bond prices, particularly in Europe.
The sentiment surrounding Europe offset two strong lead-ins to Friday’s nonfarm payrolls report with data from ADP showing private employers in the U.S. added 325,000 jobs last month, while weekly jobless claims tumbled 15,000.
We expect a range for today in AUDUSD rate of 1.0100 to 1.0200
Set limit BUY order for AUDUSD at 1.0080 (We enter the trade)
Stop loss at 1.0020
Target at 1.0160 and 1.0215
EURUSD: Traders betting that the euro zone’s sovereign debt troubles will continue piled up a net $22.7 billion in wagers that the beleaguered euro will decline as of Jan. 3, government data showed Friday.
That position represents the largest net gamble against the euro since at least 2007, with speculators holding a net 138,909 contracts, up 8% from the week before, according to the Commodity Futures Trading Commission’s weekly report on the commitments of traders.
The market positioning shows that currency traders are wary of European political leaders’ ability to address the fiscal crisis that has the euro zone lurching toward recession.
We expect a range for today in EURUSD rate of 1.2640 to 1.2760
Set limit BUY order for EURUSD at 1.2640 ranges
Stop loss at 1.2580
Target at 1.2770 and 1.2830
USDJPY: The emerging-market currency rally spurred by a strong U.S. jobs report faded late Friday, as euro-zone worries loomed over markets.
Emerging-market sovereign debt saw little change on the day, as riskier assets lacked direction and investors weighed the U.S. data against the Europe crisis. The spread on the J.P. Morgan Emerging Markets Bond Index Global, or Embig, widened by just 2 basis points at 423 basis points over Treasurys. In price terms, its index slipped 0.1%.
U.S. nonfarm payrolls increased by 200,000 in December, according to the Labor Department, topping expectations for 155,000 new jobs. The unemployment rate dropped to 8.5% last month, its lowest level since February 2009.
We expect a range for today in USDJPY rate of 76.60 to 77.50
We set limit BUY order for USDJPY at 76.60
Stop loss at 76.10
Target 77.30 and 77.60
