OctaFX | OctaFX Forex Broker
Open trading account

US jobs' gain gives the dollar another boost

The dollar soared against most competitors after the US government reported a strong gain in jobs for February. US economy added 236,000 new jobs, against 160,000 expected, while the unemployment rate fell to 7.7% from 7.9% the previous month.

The greenback surged on the news as the strong figures lower prospects of further easing by the Fed. Unemployment rate is inching closer to the Fed's 6.5% target for when it will consider withdrawing expansionary measures.

In this regard, the Wells Fargo analyst team comments that the greenback gained against most G10 currencies "reflecting the direct interest rate impact of the figures, even if the report does not translate into any immediate shift in the Federal Reserve's monetary policy stance".

The EUR/USD fell to a fresh 3-month sub 1.3000 while the USD/JPY reached its highest level since August 2009 at 96.54. Besides the USD, the only beneficiary was the CAD given its high dependence on the US economy and also boosted by strong domestic jobs data. The nonfarm payrolls report also underpinned stocks in Wall Street and Europe.

Euro hits 3-month low, eyes 1.2900

EUR/USD was dragged below the 1.3000 level to a fresh 3-month low of 1.2955 in the wake of the dollar's rally. Technically, the bearish pressure has increased on the cross, although as short-term indicators reach oversold level, the EUR/USD could see some consolidation before another leg lower.

If the pair breaks below the 1.2955/50 zone, next target would be the 1.2900/08 region (psychological level/ Fib 76.4% of 1.2660/1.3710) ahead of 1.2880 (congestion area). However, as mentioned, short-term bounces could not be dismissed, with 1.3100/30 as initial resistance followed by 1.3160 (Feb 28 high).

"Although the immediate impact today (of NFP) has been a firmer greenback, the encouraging news should help market sentiment heading into next week", says Nick Bennenbroek, Head of Currency Strategy at Wells Fargo Bank. "We believe that could support a steady to slightly stronger trend for commodity and emerging currencies against the U.S. dollar, but we expect further losses in the euro, yen and pound".

Forex: USD/CAD bounces at 1.0230, back to 1.0280

After falling around 80 pips from 1.0315 to test the March low at 1.0230, the USD/CAD bounced at this level to trade back above the 1.0250 and reach levels around 1.0280. Currently the pair is trading at 1.0275, 0.17% below opening price.
Read more Previous

Forex: USD/MXN in weekly lows despite rate cut

The Mexican peso is sharply appreciating against the greenback on Friday, despite the 50 bps rate cut by the Banxico (Mexico’s central bank), against the market consensus that was biased towards the ‘on-hold’ stance....
Read more Next
Start livechat