ADP employment in the world’s largest economy jumped 297K in December after climbing 92K the month prior amid economists’ expectations of 100K to mark the highest reading since record keeping began. Subsequent to the better than expected report, the greenback rallied against all of its major counterparts. The reading bodes well for Friday’s nonfarm payrolls report and may lead the dollar to continue its northern journey during the American trade today.
The ADP employment report suggests that traders may witness a better than expected employment report later on this week. In November, the ADP release overshot the reported labor department’s private employment component which is not common. On average, the ADP missed the labor survey by approximately 59K, thus pointing to 200K+ rise in payrolls. Looking ahead, economists are forecasting a 135K rise in nonfarm payrolls and a 150K increase in private payrolls.
USDJPY 15-Minute Chart
Source – FXCM’s Strategy Trader
The USDJPY extended its two day advance but momentum may slow at this level as the pair tests the 100-day SMA. However, it is worth noting that technical developments as of late point to additional gains in the pair.
USDCHF 15 Minute Chart
Source – FXCM’s Strategy Trader
The USDCHF extended yesterday's gains and now looks poised to push higher over the near term as our user defined slow stochastic indicator recovers from oversold levels, while the MACD looks poised to crossover to the upside, which is indicative of further upside risks. I will look to remain long from 0.9514 with an open target and a stop at break-even.
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