Sample Category Title

Thursday's session was market by strong upside momentum that allowed the common European currency to appreciate 96 pips against the Greenback.

The morning was spent with low volatility that seemed to point to a period of consolidation. However, a test of the weekly PP was followed by a notable surge up to the 1.2520 mark as a result of which the Euro surpassed the 1.25 mark and formed a new 1,5-year high.

Bulls might still succeed at pushing the rate slightly higher; however, the weekly R1 at 1.2575 is unlikely to be breached. The base scenario favours the rate approaching the support area formed by the 55-, 100– and 200-hour SMAs in the 1.2440/00 range.

Meanwhile, the following week might mark a breakout of this cluster and a subsequent fall.

The British Sterling was driven by upside risks on Thursday, thus being able to appreciate 75 pips against the US Dollar.

This session, however, was market by low volatility slightly below the post-Brexit-vote high of 1.4213. This northern barrier is expected to hold strong, resulting in a southward pressure towards the 100– and 200-hour SMAs near 1.4157 today. The 55-hour moving average which was located in between the current price and the aforementoned area in the morning could likewise hinder the pair for several hours.

In general, the prevailing ascending channel is expected to surrender, thus allowing the Pound to approach the monthly PP and the 38.20% Fibo retracement at 1.3953. A steeper fall during the following sessions would confirm a double-top-like formation.

The Greenback remained stable against the Yen on Thursday, as it failed to overcome the constraints of the 200-hour SMA and a seven-day resistance at 109.69. This price level and the dashed up-trend line has formed a short-term ascending triangle.

It seems that the rate could be ready to breach this pattern to the upside, especially if the southern barrier is guarded by the weekly PP , the 55– and 200-hour SMAs circa 109.35. Technical indicators are likewise supportive of this scenario, as they demonstrate that some upside potential still exists.

Apart from the 109.69 mark, the nearest resistance is set by the weekly PP and the monthly R1 near 110.35. This area is expected to be the daily high.

Gold spent most of Thursday's trading session below the 1,345.50 mark, as its further appreciation was restricted by the 200-hour SMA. The pair eventually collected enough momentum to dash through this line and the 55– and 100-hour SMAs. As a result, the upper boundary of the short-term ascending channel was breached to the upside.

By Friday morning, the pair had retraced back to the upper channel line. This factor together with bullish technical indicators suggests that the yellow metal is likely to continue its upward momentum in this session, as well, thus accelerating from the 200-hour SMA. The nearest resistance is set by the five-month high and the weekly R1 at 1,365.00 and 1,367.87, respectively

The Sterling rose markedly against the US Dollar ahead the report on the UK manufacturing sector. Thought, weaker-than-anticipated data dampened USD/GBP with the exchange rate falling 11 base points or 0.08% initially.

Britain's manufacturing sector lost some strength in growth momentum last month, as factory activity was held back by common weakness in the country's economy in preparation for Brexit. The Markit/CIPS reported that the UK Manufacturing PMI fell to 55.3 in January, the lowest level in seven months, but still above the 52.7 long-term average. Relatively strong figures suggested that manufacturing outlook is likely to remain bright on behalf of exports.

The ISM Manufacturing PMI release had not prevented a lingering upmove in the EUR/USD exchange rate. The pair added 10 base points to grow further to the 1.2520 level.

The US manufacturing activity weakened in January due to a decrease in new orders, though an unexpected fall in the number of Americans filing for unemployment aid last week indicated lingering job market strength, which could underpin bolster domestic demand. The ISM stated that the US Manufacturing PMI decreased to 59.1 in January from 59.3 in the prior month. The other data showed notable gains in construction spending. Meanwhile, a decrease in worker productivity pointed to more difficult maintenance of strong expansion pace.

EUR/USD

Current level - 1.2504

My outlook is counter-trend below 1.2540, for a reversal and another slide towards 1.2330 major static support. Key intraday support lies at 1.2470.

USD/JPY

Current level - 109.77

The bias is positive again, for a rise towards 110.20 resistance. Crucial on the downside is 109.20 low.

GBP/USD

Current level - 1.4245

My outlook is counter-trend, for a reversal of the current rise below 1.4340 and beginning of a slide towards 1.3910 zone. Trigger on the downside is 1.4180.

Cable eases from recovery top at 1.4277 on Friday as strong three-day rally shows initial signals of fatigue. Daily RSI is overbought and turning lower while bulls are losing momentum which could result in corrective easing before renewed attempts towards targets at 1.4344 (25 Jan peak, the highest since 24 June 2016 Brexit vote) and 1.4385 (falling weekly 200SMA) break of which would generate fresh bullish signal and add to existing positive sentiment. Overall bullish structure favors further advance and extension of broader recovery phase from 1.1930 post-Brexit low. The pair is on track for the seventh straight bullish weekly close that supports the notion. Today's close will be closely watched as red daily candle will be negative signal and could trigger further easing. Ascending 10SMA marks initial support at 1.4140 which is expected to ideally contain and keep near-term focus at the upside. Loss of 10SMA support would signal deeper pullback and would risk retest of key near-term support at 1.40 zone (Fibo 38.2% of 1.3457/1.4344 upleg/near 30 Jan correction low). Sustained break here would generate stronger bearish signal for reversal.

Res: 1.4277, 1.4300, 1.4344, 1.4385
Sup: 1.4207, 1.4159, 1.4140, 1.4093

The battered Dollar weakened against its major peers this week, as investors closely evaluated the fundamental factors that are weighing heavily on the currency.

Friday's key event risk will be the US jobs report for January, which should offer fresh insight into the health of the US labor market. With the Federal Reserve expressing optimism over inflation rising this year and a brighter outlook for the economy, today's NFP report will be in sharp focus. Markets expect the US economy to have gained 180k jobs in January, with average earnings up by 0.3%, while the unemployment rate is expected to remain unchanged at 4.1%.

While every detail of the US jobs report is critical, there will be a strong focus on wage growth. Any signs of wage growth accelerating could stimulate expectations of rising inflation, ultimately lifting the prospects for further US interest rate increases this year. With the Dollar clearly in need of a lifeline, it will be interesting to see if January's US jobs report comes to the rescue. A scenario where the headline jobs number and wage growth both dish out upside surprisesmayoffer the Dollar some support.

Focusing on the technical picture, the Dollar Index remains firmly bearish on the daily charts. Technical lagging indicators, such as the 50 Simple Moving Average and MACD both go in line with the bearish bias. Repeated weakness below 89.00 may invite a further decline towards 88.50 and 88.00, respectively. Alternatively, a move back above 89.35 could spark an incline back to 89.60 and 90.00.

Commodity spotlight – Gold

Gold prices appreciated for the second straight session on Thursday, as a softening US Dollar stimulated investor appetite for the yellow metal.

Prices remain nearly unchanged during early trading on Friday, ahead of the heavily anticipated US jobs report scheduled forrelease this afternoon. Gold bulls could receive fresh inspiration to elevate prices higher towards $1360, if the NFP report disappoints. Alternatively, a solid US jobs report could trigger a technical correction which sends the metal back to $1340. From a technical standpoint, we remain bullish on Gold on the daily charts, as there have been consistently higher highs and higher lows. The new higher low around $1333 may create a foundation for Gold to test $1360 and higher.

Bitcoin struggles to fight back

It has certainly been a horribly bearish trading week for Bitcoin, thanks to heightened fears of a regulatory crackdown.

The growing confusion revolving around the Indian government's view on cryptocurrencies sparked uncertainty on Thursday, consequently exposing Bitcoin to downside risks. With US regulators closely scrutinizing one of the world's largest digital exchanges and Facebook Inc banning adverts that promote cryptocurrencies, Bitcoin is in trouble. Price action suggests that bears are clearly in control, with further losses on the cards as jitters over regulation erode investor appetite further. From a technical standpoint, Bitcoin is firmly bearish on the daily charts. The breakdown below $9000 may encourage a further decline towards $8400 and $8000, respectively.

Here are the latest developments in global markets:

FOREX: The dollar index was practically unchanged on Friday ahead of the US employment data, after it previously posted notable losses on Thursday. The yen tumbled against its major peers, weighed on by the BoJ's regular bond-buying operations, which pushed Japanese bond yields lower.

STOCKS: Japanese markets retreated despite the overnight tumble in the yen. The Nikkei fell 0.9%, while the Topix pulled back 0.3%. In Hong Kong, the Hang Seng was in the green, though not by much. In Europe, futures tracking the Euro STOXX 50 were in negative territory. Finally, in the US, the major indices were mixed yesterday. The Dow Jones closed marginally higher, though the S&P 500 and the Nasdaq Composite both finished lower. The recent underperformance of US equities is being attributed to the continued surge in US Treasury yields. As yields rise, bonds begin to offer a higher and “safer” return for investors, thereby curbing demand for stocks. Futures tracking the Dow, S&P, and Nasdaq 100 are all currently in negative territory.

COMMODITIES: Oil was one of the biggest movers on Friday, with WTI and Brent crude surging 0.5% and 0.4% respectively. Today, oil traders are likely to focus on the Baker Hughes US oil rig count, in order to gauge whether US producers have continued to increase their output in the face of elevated prices. Meanwhile, gold prices were little changed, with the precious metal last trading near $1348 per ounce.

Major movers: Dollar softens ahead of employment data

The greenback tumbled once more during the European trading session on Thursday, with no clear catalyst behind the move. Interestingly enough, the dollar retreated even despite a spectacular surge in US Treasury yields, something that usually supports the currency. The 10-year yield rose to a fresh high - it's highest since April 2014 - last trading near 2.79%, while 30-year yields broke above the 3% milestone, last trading around 3.03%. The biggest gainers from the tumble in the US currency were the euro and sterling.

Today, dollar-traders will turn their eyes to the US employment report for January. Since the US economy is already considered to be near full employment conditions, investors are likely to focus more on wage growth as opposed to jobs added, as they try to gauge whether inflationary pressures are beginning to intensify.

Despite the softer tone in the greenback, dollar/yen actually rose 0.2% on Friday, underpinned by the BoJ's bond-buying operations. The Bank stepped into the market and offered to buy “unlimited” amounts of bonds in order to curb Japanese yields from rising. Such actions are typical under the Bank's QQE with yield-curve control framework. The BoJ has committed to keeping 10-year yields near 0%, so every time yields approach 0.1%, it steps into the market to push them back down.

Elsewhere, the antipodean currencies retreated, with both aussie/dollar and kiwi/dollar declining nearly 0.4%

Day ahead: US NFP report dominates attention; UK releases construction PMI; eurozone producer prices due

The UK will see the release of the Markit/CIPS construction PMI for the month of January at 0930 GMT. The measure is projected to decline for the second straight month, but at 52.0 - should expectations materialize - it would remain in growth territory (above 50). Yesterday's manufacturing PMI for the same month surprised to the downside, leading to sterling weakness. The respective PMI figure for the much more important for the UK economy services sector will be released next week (Monday).

Eurozone data on December producer prices will be made public at 1000 GMT. Prices are expected to reflect a slowdown on both a monthly and an annual basis.

Without a doubt the highlight of the day - and the release having the capacity to spur sharp movements in dollar pairs - will be the US nonfarm payrolls report for the month of January due at 1330 GMT. The number of positions added to the economy is anticipated to have bounced up after some weakness in December on the back of poor weather conditions; forecasters project the addition of 180k jobs versus 148k in December. The unemployment rate is expected to remain at the 17-year low of 4.1%, but yet again investors' focus is likely to turn on wage growth. Average hourly earnings are expected to grow at a monthly rate of 0.3%, the same as in December, while on an annual basis they're projected to expand by 2.6% - this compares to 2.5% in December. Growth in wages has the potential to alter the outlook for inflation and thus affect the Federal Reserve's tightening cycle.

Later in the day (at 1500 GMT), the US will see the release of data pertaining to December's factory orders, as well as the University of Michigan's final reading on consumer sentiment for the month of January.

In energy markets, the US Baker Hughes oil rig count is due at 1800 GMT.

Policymakers making appearances include ECB executive board member Benoit Coeure who will be speaking at the conference titled “Deepening of EMU” at 1000 GMT, and Fed Bank of Dallas President Robert Kaplan - a non-voting FOMC member in 2018 - who will be participating in a Q&A session before the Teacher Retirement System of Texas Annual Conference at 1830 GMT. Fed Bank of San Francisco President John Williams - a voting FOMC member in 2018 - will be talking about the US economy before the Financial Women of San Francisco at 2030 GMT.

Energy companies Chevron and Exxon Mobil and pharma firm Merck & Co. are among firms releasing quarterly results on Friday. All three will be releasing their reports before the US market open.

Technical Analysis: EURUSD trades near highest since late 2014; RSI overbought

EURUSD is trading not far below its highest since December 2014 of 1.2537 hit on January 25. Technical indicators are projecting a bullish picture in the short-term: the Tenkan- and Kijun-sen lines are positively aligned and the RSI is well into bullish territory (above 50) and continues rising. The fact that the RSI has crossed above the 70 overbought level though, could be a sign that a short-term pullback in not to be ruled out.

A disappointing US jobs report - especially on the wage growth front - is likely to see the pair rising. In this case, last week's three-year high of 1.2537 might act as immediate resistance. An upside break, which is not that unlikely in this scenario given that price action is currently taking place close to the aforementioned high, would shift focus to the area around 1.26 as another barrier to the upside; 1.26 being a potential psychological level.

On the downside and in case of a strong NFP report, EURUSD could find support around the current level of the Tenkan-sen at 1.2380. The area around this point also encapsulates 1.24, this being another mark that may be of psychological significance.