AMERICAN UNEMPLOYMENT FALLS TO 4.2%

The main focus of the market today was turned to the labour market data release in the US. Non-farm payrolls reduced by 33,000 in September compared to an expected increase of 82,000. Most experts are explaining the drop in jobs on the impact from hurricanes Harvey and Irma on economic activity. At the same time, many analysts are expecting a rise in employment during the coming month as an increased labour force will be required to restore damaged assets after the devastation from the natural disasters. USD bulls were cheered by the reduction in the unemployment rate in September to 4.2% which is 0.2% better than expected and the average hourly earnings increase of 0.5% against the 0.3% forecasted. The euro continues to remain under pressure due to the possible withdrawal of Catalonia from Spain. If this situation eventuates then it may weaken the euro and give rise to more political tension in other parts of the European Union. Traders ignored positive news of German factory orders growth of 3.6% in August against an expected 0.7% growth.

The USD/JPY demonstrated a confident rising movement thanks to the greenback’s strengthening and disappointing data from Japan’s leading economic index that increased to 106.8% in August which is 0.4% short of the expected figure but still better than 105.2% in July.

The USD/CAD got some support from the labour data in Canada, according to which the unemployment rate remained at the 6.2% level which is 0.1% better than expected. Ivey PMI growth to 59.6 in September against 56.3 in August was positive for the Canadian dollar but still not enough to pull back the US dollar bulls. Investors are not hurrying to open new positions ahead of the long weekends coming up in the US, Canada and Japan.

EUR/USD

The single currency keeps moving along the upper limit of the descending channel, the limits of which it previously left. Immediate targets in case of maintaining negative dynamics will be 1.1620 and 1.1550. The growth potential today is likely to be restrained by resistance at 1.1750 and in order to change the current negative trend to bullish, the quotes need to gain a foothold above 1.1800.

USD/JPY

After a long consolidation of USD/JPY price below the 113.00 level, the bulls were able to push the price above this mark. This is the basis for continued rising dynamics with the closest goals at 114.00 and 114.70. The RSI on the 15-minute chart approached the overbought zone which indicates a possible price rollback. In this case the quotes may return to 113.00.

USD/CAD

The USD/CAD is trying to fix above the important 1.2550 level that may become a trigger for growth resuming within the limits of the ascending channel. In which case the next target will be 1.2665. A downward correction is likely to be limited by the lower limit of the channel. Traders may act cautiously ahead of the long weekend in Canada and the US.