• Share this:

Top Stories

• Australian employment beats
• UK MP/IP mixed
• Nikkei off -0.39% Europe 0.31%
• Oil at $96.45/bbl
• Gold at $1590/oz.

Overnight Eco

• AUD Employment Change (APR) 15.5K vs. -4.8K
• AUD Unemployment Rate (APR) 4.9% vs. 5.3%
• JPY Adjusted Current Account Total (Yen) (MAR) 0.79T vs. 0.65T
• JPY Eco Watchers Survey: Current (APR) 50.9 vs. 52.5
• NZD Business NZ Performance of Manufacturing Index (APR) 48.0 vs. 53.8
• GBP Industrial Production (MoM) (MAR) 0.5% vs. 0.0%
• GBP Manufacturing Production (MoM) (MAR) -0.3% vs. 0.2%

Event Risk on Tap

• USD Trade Balance (MAR) expected at -$50.0B
• USD Import Price Index (MoM) (APR) expected at -0.2%
• USD Initial Jobless Claims (MAY 5) expected at 370K
• USD Continuing Claims (APR 28) expected at 3280K
• CAD New Housing Price Index (MoM) (MAR) expected at 0.1%
• CAD International Merchandise Trade (Canadian dollar) (MAR) expected at 0.55B

Price Action

• USD/JPY quiet at 79.70
• AUD/USD rises to 1.0100 after good labor data
• GBP/USD drops to 1.6100 post IP
• EUR/USD stationary at 1.2950

A quiet night of consolidation  in the currency market today with EUR/USD steady at 1.2950 level as markets continue to wait for resolution of the Greek parliamentary elections. Euro zone governments kept Greece afloat on Wednesday after agreeing  to a payment of 5.2 billion euros from the region's bailout fund. The EFSF agreed to make the scheduled payment, which will allow Greece to meet near-term bond redemptions and other obligations and the news of that announcement has helped to stabilize the selloff in the euro for the time being.

Elsewhere in Australia, employment hit its lowest level in a year sending Aussie above the 1.0100 level in Asian session trade.  The economy surprised to the upside adding 15.5K new jobs  versus forecasts of a decline of  -4.8%. The unemployment rate dropped below the key 5% barrier printing at 4.9%. This was the first time that the unemployment rate dipped below 5% since June of 2011.

Most of the job growth came from the part time sector, dampening investor’s enthusiasm somewhat, but the April data was nevertheless impressive and eased fears that the RBA  would be forced to reduce rates once again after its  surprise 50 basis point cut  earlier this month.

The Aussie rallied in the aftermath of the release hitting a high of 1.0125 as shorts quickly scrambled for cover. With analysts expecting an overall  loss in jobs, many traders positioned themselves for a break of the key parity level ahead of the release, but the surprisingly robust labor data caused   a flurry of short covering.

Still the rally Aussie may be contained with the pair struggling to recover much beyond the 1.0100 level given the latest trade data from China.  China showed a rise in trade surplus to  18.4 Billion from 5.35 Billion in March, but exports climbed 4.9 percent from a year earlier, which was less than the increase of 8.9 percent seen in March, according to government figures. Imports rose 0.3 percent much less than the increase of 5.3 percent in March. Both data sets show that external and internal demand are slowing in China which could weigh on Australian economy as the year progresses.  

In North America today the calendar carries Trade Balance data and the unemployment claims neither of which should have a strong impact on currency trading as news from Europe continues to dominate flows. Chairman Bernanke is also scheduled to give a speech on bank lending at 13:30 GMT, but its doubtful that he will make any headlines. Overall risk FX remains under pressure and any fresh possibility of “Grexit” will likely send EUR/USD tumbling through the 1.2900 barrier as the day proceeds. 

FX Upcoming

Currency	GMT	EST	Release	Expected	Prior
USD	12:30	8:30	Trade Balance (MAR)	-$50.0B	-$46.0B
USD	12:30	8:30	Import Price Index (MoM) (APR)	-0.2%	1.3%
USD	12:30	8:30	Initial Jobless Claims (MAY 5)	370K	365K
USD	12:30	8:30	Continuing Claims (APR 28)	3280K	3276K
CAD	12:30	8:30	New Housing Price Index (MoM) (MAR)	0.1%	0.3%
CAD	12:30	8:30	International Merchandise Trade (Canadian dollar) (MAR)	0.55B	0.29B

The information, including Commentary and Trade Ideas, provided on FX360.com should not be relied upon as a substitute for extensive independent research which should be performed before making your investment decisions. Global Futures & Forex, Ltd. (“GFT Markets”) and FX360.com is merely providing this information for your general information. The information and opinions presented do not take into account any particular individual’s investment objectives, financial situation, or needs. All investors should obtain advice based on their unique situation before making any investment decision and should tailor the trade size and leverage of their trading to their personal risk appetite. Any projections or views of the market provided by FX360.com may not prove to be accurate.

The views of the authors and analysts are not necessarily those of GFT Markets, its owners, officers, agents or other employees. FX360.com and the currency research team will not be responsible for any losses incurred on investments made by readers and clients as a result of any information contained on FX360.com. GFT Markets and the currency research team do not render investment, legal, accounting, tax, or other professional advice. If investment, legal, tax, or other expert assistance is required, the services of a competent professional should be sought.

About The Author

Boris Schlossberg began his Wall Street trading career more than 20 years ago at Drexel Burhnam Lambert. There, he traded nearly every type of financial product on the market in the U.S., from equities and options to stock index futures and foreign exchange. His innate ability to analyze market information and use it to trade has helped him become an industry-recognized, “go to” trading professional.

These days, whenever the markets move, many organizations turn to Schlossberg for his take on the situation. He is a weekly contributor to CNBC's Squawk Box and a regular commentator for Bloomberg radio and television. His daily currency research is widely quoted by Reuters, Dow Jones and Agence France Presse newswires and appears in numerous newspapers worldwide. Schlossberg has written for publications like SFO magazine, Active Trader and Technical Analysis of Stocks and Commodities. He is also the author of Technical Analysis of the Currency Market and the co-author of Millionaire Traders: How Everyday People Are Beating Wall Street at Its Own Game with Kathy Lien. He joined GFT in 2008.