- Tomorrow’s key Nonfarm Payrolls to boost the US dollar?
- End of the month flows sees a sharper Yen and EUR/JPY capped below the 200-DMA.
EUR/JPY is been rejected just below the 200-day moving average as pressures mount following a failure on multiple attempts beyond 121.50. Indeed, the political and economic backdrop leaves little hope for the bulls at this juncture and a resumption of the year-long decline could well play out into years end.
The end of the month sees a sharper Yen and a wobble in US stock markets, weighing on the cross. Indeed, markets had been trading defensively in month-end following yesterday’s FOMC’s cut and pause decision – Despite the Euro area’s Q3 GDP coming in a touch better than expected, rising 0.2% QoQ yesterday, the euro has been unable to really capitalise on this, yet, it was a key reminded that the manufacturing sector remains in a poor state.
DXY to weigh on the euro?
However, at this juncture, it really is all bout the US data this week, with the Federal Reserve leaving markets with a less than compelling prospect for easier money in the near future and then, with tomorrow’s key nonfarm Payrolls. Indeed, we are likely to see a noisy payroll and combined with a modest improvement in ISM manufacturing, it will be all eyes on the DXY which is currently testing the pivot at the 200-day moving average around on the 97 handle. Having said that, considering the Fed being on what feels like a pause, the odds for a stronger DXY, and thus a weaker euro, should be a weight to the cross, especially with a fragile geopolitical backdrop.
EUR/JPY levels
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