AUDUSD: Weaker than expected jobs numbers sent the Australian dollar to session lows Thursday as analysts said rising unemployment is beginning to show a trend, raising the prospect of a possible rate cut in coming months.
Unemployment rose to a higher-than-expected 5.3% in August–a near 12 month high–from 5.1% in July, while the number of employed fell 9,700, the Australian Bureau of Statistics said Thursday. Economists had expected 5.1% unemployment and 11,000 new jobs.
The data prompted a flurry of analysts to predict the Reserve Bank of Australia may need to begin easing policy sooner than anticipated, although the rates market has long been pricing in rate cuts.
We expect a range for today in AUDUSD rate of 1.0340 to 1.0480 (We entry long at 1.0400 ranges, stop loss at 1.0330, target at 1.0460, 1.0520, 1.0580.)
EURUSD: Speculators slashed their bearish bets against the dollar and increased their wagers against the euro, data from the Commodity Futures Trading Commission’s showed Friday.
The dollar, which has been out of favor with currency investors, had the smallest net short position it’s seen since Jan. 4. Investors backed away from bets that another global recession and a phalanx of fiscal woes for developed-market governments worldwide would continue to hurt the dollar’s outlook. Traders bet a net $5.5 billion that the dollar will decline against all major currencies, down 65% from the previous week’s report.
The euro, which remains strong despite a drumbeat of negative news about the monetary union’s sovereign-debt troubles, had a net short position worth $6.4 billion, shooting up to 36,443 contracts, the largest market short against the euro since Jan. 11. That’s a big change from last week, when traders were virtually neutral on the euro’s prospects.
We expect a range for today in EURUSD rate 1.3530 to 1.3630 (We avoid trading the pair at this stage, the pair could head further SOUTH toward 1.3000 areas.)
USDJPY: In a speech overnight, Fed Chairman Ben Bernanke failed to shed any light on the Fed’s likely course of action when the bank reconvenes for a special 2-day meeting on Sept 20.
Bernanke stopped short of announcing any specific measures to resurrect growth in the U.S, but assured markets the Fed still has the tools if necessary. The baton will now be handed to President Obama who is expected to unveil a grand job creation plan said to be worth $US300 billion.
We expect a range for today in USDJPY rate of 77.20 to 77.70 (We expect the pair going side way this week within this range.)
