Previous session overview
The euro dropped against the dollar Friday after disappointing U.S. unemployment data cast doubt over the pace of the global economic recovery.
The euro sank to a low of USD1.4821 in the wake of the report, from USD1.4861 just ahead of the data, bouncing around in choppy trade.
October payrolls declined a larger than expected 190,000, though September job losses were revised to 219,000 from an originally reported 263,000. The unemployment rate shot to its highest level in 26 years, to 10.2% in October, from 9.8% in September.
Analysts had expected a loss of 175,000 jobs, and an unemployment rate of 9.9%.
Canadian employment data out earlier Friday was as disappointing as the just released US non-farm payroll. In Canada, a net 43,200 jobs were lost in October vs median estimates of +10k and HSBC's more upbeat forecast of +26k, notes Stewart Hall of HSBC. The unemployment rate rose to 8.6% (from 8.4%).
Market expectation
EURUSD now able to retest the overnight high area at USD1.4905 as the dollar slips further but as risk-appetites track the bounce in US stocks. Offers remain at USD1.4920, atop yesterday's USD1.4918 high. Stops still the risk above USD1.4930.
Pound edges back to retest resistance between USD1.6570/80, a break here to open a move toward USD1.6600/10 (USD1.6605 76.4% USD1.6635/1.6517). Through here and area between USD1.6635/40 moves into view, with stops reported above. Bids remain in place from below USD1.6520 through to USD1.6500. Below here and rate can extend move toward USD1.6470/60.
USDJPY saw modest bounce off JPY89.90 area on option-related demand but pair stalled quickly as offers appeared around JPY90.25 area to cap and as stock futures remain heavy. Stops remain intact under JPY89.90, dollar last at JPY89.98.
