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Forex Daily Outlook – March 3rd 2010

Today’s highlights are the Australian GDP and American ADP Non-Farm Payrolls, which will raise the tension towards Friday’s big event. Let’s see what’s up for today.

The low expectations for Friday’s Non-Farm Payrolls are favorable for the dollar. Here’s my Non-Farm Payrolls preview. Let’s start today’s review:

British Nationwide Consumer Confidence starts the day with an expected drop of confidence to 71 points, after reaching a peak at 73. Traders lose confidence in the Pound.

Later in Britain, the purchasing managers’ index for the services sector  will complete the series of PMI releases with an expected rise to 55 points.

For more on the British Pound, check out the GBP/USD forecast.

In Australia, GDP is released one day after the rate hike. After a disappointing growth rate of 0.2% in Q3, a much faster growth is predicted now 0.9%. The Aussie was left unexcited by the rate decision. Will it move after the GDP release?

For more on the Aussie, read the AUD/USD forecast.

In Japan, Average Cash Earnings are predicted to fall by 1.2% on a yearly basis, less than last time. On the other side of the day, quarterly Capital Spending is predicted to show a drop of 18.1% (annually). The Japanese yen is rather stable.

In Europe, German Retail Sales will probably drop by 0.5% after rising last month. Later, the all-European retail sales are predicted to drop as well, by 0.3%.

EUR/USD is supported by 1.3423. This is a critical line. For more on the Euro, read Casey Stubbs’ latest analysis and my EUR/USD forecast.

In the US, two job indicators are released: Challenger Job Cuts and the ADP Non-Farm Payrolls. The latter, ADP NFP, is expected to show a loss of 13,000, slightly better than last month’s loss of 22K. ADP doesn’t always correctly predict the outcome of the Non-Farm Payrolls on Friday.

Later in the US, ISM Non-Manufacturing PMI is expected to rise from 50.5 to 51. This complements Monday’s ISM Manufacturing PMI which is doing better.

The American events aren’t over: the Beige Book will give a wide overview on the American economy and can impact the expectations for the FOMC meeting later in the month. Also note a speech by FOMC member Eric Rosengren. He might give some hints about future policy as well.

That’s it for today. Happy forex trading!

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Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.