The US Employment report is due out today at 13:30 (GMT). NFP is expected to be at 180k vs previous reading of 146k, the unemployment rate to remain unchanged at 4.1% and average earnings to tick up to +2.6% YoY vs. previous 2.5%. Again, please pay attention to all three elements of the employment report as the market may also react to average earnings. Should the actual data meet the forecast the USD should strengthen as the forecast is favorable for USD. However, given the last few days USD weakness, the reaction may be muted somewhat. Also note that US finance minister Mnuchin, stated lately that the Davos comment about a weak dollar, did not aim at the USD exchange rates.
- Support: 1.2495(S1), 1.2355(S2), 1.2230(S3)
- Resistance: 1.2600(R1), 1.2770(R2), 1.2880(R3)
Bitcoin dropping below late November levels
Bitcoin dropped yesterday beyond the late November levels when the rally had started. A key reason for the drop could be Indian governments expressed intention to ban cryptocurrency trading altogether. Also, another reason could be that Facebook could ban all advertisements promoting cryptocurrencies. On the crypto futures front, media reports suggest that CME takes a cautious stand towards introducing other cryptocurrencies after one and a half month of Bitcoin trading. Bitcoins downward trend seems to be followed by most cryptocurrencies confirming its role as a trendsetter in the market. We stand by our view that as regulatory authorities intensify their efforts to regulate cryptocurrencies, Bitcoin’s value will continue to drop and that the bears will continue to have the upper hand in the market in the long run.
- Support: 7470(S1), 6285(S2), 4720(S3)
- Resistance: 8920(R1), 10500(R2), 12000(R3)
Today’s other economic highlights: UK
Markit/CIPS Construction PMI for January, Survey:52.0 Prior:48.1 09:30(GMT), neutral to positive for GBP.
US: Employment Report as analysed above 13:30(GMT), positive for USD.
Speakers: ECB executive board member Benoit Coeure speaks at 10.00(GMT), French Central Bank governor Villeroy and Irelands Central Bank Head Lane speak at 14:00(GMT), Dallas Fed President Kaplan speaks at 18:30 (GMT), San Francisco Fed President Williams speaks at 20:30 (GMT).
All trading involves risk. It is possible to lose all your capital