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Statistical probability suggest, disappointing NFP data – March 8

March 8, 2013

GMT 3:09 – EURO @ 1.3092 = Nothing very impressive from Mario Draghi this time, neither his tone was very Dovish as I mentioned in my yesterday’s post. I think he may have sensed the clam behaviour of the market, probably aware that Italy could be the next topic of discussion in coming days. It was a sensible move on part of ECB to avoid its most effective monetary tool unnecessarily, as Euro regions real economic data still paints clumsy picture hinting that the suffering would linger on for longer duration, which means economic recovery will take more time or could be too slow.
This is why he (Draghi) emphasised that if necessary ECB policy stance will remain accommodative. Europe may have avoided threat of break out temporarily, but it is yet to face bigger threat/challenge i.e, growth and rising unemployment, which can easily bring unrest in the region. Draghi has already indicated that ECB did consider slashing of rates, which means that deteriorating economic conditions in the Euro-zone will  increase the probability of rate in the coming months.
Meanwhile, market focus will once gain shift towards the week’s big event US Non-Farm Payroll (NFP). If we have a deeper look at the US major economic indicators they were mostly strong that should indicate good job condition in USA. I am not about the impact of some of the recent events, which can distort the numbers. But what worries me most is that February is the shortest month of the  year and President’s Day holiday another day is squeezed. So in all statistical probability I will not be surprised to see disappointing NFP data.

GMT 3:09 – EURO @ 1.3092 = Euro may find support around 1.3065-70 until NFP and could make an attempt towards 1.3125-30 levels, but should not surpass 1.3160 before the data. However, sentiment could turn mildly bearish on bad payroll data that could see a test of .31-75-80 zones break would suggest 1.3110-20. On the downside, break of 1.3005-10 levels would mean test of new lows next week.   
GMT 3:15 – GBP @ 1.5003 = Top around 1.5025-30, as 1.5080 remains strong resistance level. See risk for a drop to around 1.4975, before comeback if 1.4940 holds.
GMT 3:18 – AUD @ 1.0241 = Mild pressure is building up and I am expecting 1.0265 to hold, but profit on dip is suggested as 1.0210-20 is the strong  support zones. Only break suggest test of 1.0185-90 zones .
GMT 3:23  – JPY 95.40 = We have seen sharp slide of Yen. Should take a breather around 95.50-60 zones for 91.10 or else this run could extend up to 95.80-90 zones.
GMT 3:28 – GOLD @ $ 1577.70 = Until NFP gold may trade in a $ 1574-82 range, but today, if gold fails to push below $ 1565 for bigger losses, I will not be surprised to a a move and break of $ 1595 for $ 1610-15 zones.

 

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