“¢ Disappointing ADP report exerts some downward pressure on the USD.
“¢ Stellar weekly jobless claims ease the bearish pressure, at least for now.
“¢ Traders now eye ISM non-manufacturing PMI for some fresh impetus.
The USD/JPY pair finally broke down of the European session consolidation phase and touched a two-day low level of 111.12 in the last hour.
The US Dollar held on the defensive after the latest ADP report showed that the US private sector employers added 163K new jobs in August, down from a downwardly revised reading of 217K for July.
The headline figure marked the weakest growth in 10-month and was also well below consensus estimates pointing to an addition of 190K jobs, which exerted some fresh downward pressure over the past hour or so.
Further downside, however, remained cushioned following the release of initial weekly jobless claims, which fell to a 49-year low and reaffirmed the underlying strength in the US labour market.
Adding to this, some signs of stability in equity markets did little to boost the Japanese Yen’s safe-haven status and further collaborated towards limiting any sharp downside, at least for the time being.
Today’s US economic docket also features the release of ISM non-manufacturing PMI, which will be looked upon for some fresh impetus ahead of Friday’s keenly watched US monthly jobs report (NFP).
Technical outlook
Valeria Bednarik, FXStreet’s own American Chief Analyst writes: “The pair has lost upward strength and technical readings indicate that it may extend its decline during the upcoming hours, as in the 4 hours chart, indicators have accelerated their slides, the Momentum still above its 100 level, but the RSI already in negative territory. Moving averages in the mentioned chart are directionless and close to each other around 111.00, and while they lack the strength to be a support, a break below them would be a psychological sign that will fuel bears determination.”
Share
