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Risk-on market profile drove the sentiment across Asia this NFP Friday, despite the negative close on the Wall Street overnight, as Treasury yields, Asian stocks and US equity futures traded with modest gains. Meanwhile, the US dollar extended its upside consolidation phase against its major peers, leaving most majors wavering in a tight trading range.

Amongst the Asia-pac currencies, the Aussie witnessed good two-way price movements, having dropped to fresh 4-month lows at 0.6985 on a sharp drop in the Australian building approvals data before recovering to the 0.70 handle. The Kiwi tracked the AUD/USD price action and regained the bids near 0.6620 levels, partly supported by the latest Fonterra headlines. The USD/JPY pair, on the other hand, stuck to its 15-pips trading range, awaiting fresh impetus from the key US payrolls release.  

Moving onto the European currencies, the EUR/USD pair remained exposed to downside risks near 1.1170 levels while the Cable traded modestly flat around 1.3035 region amid disappointing early results of the UK local elections.

On the commodities front, both crude benchmarks remained on the offer on rising US output while gold prices on Comex kept its recovery mode intact near 1273 levels.

Main Topics in Asia

Gold Technical Analysis: Bears gunning for the 200-DMA, although stochastics oversold

US-China trade deal unlikely to address cybertheft or subsidies – The New York Times

US Pres. Trump: US has a very good chance to have a great trade deal with China

US Pres. Trump: Now Republicans and Democrats must come together for the good of the American people

AUD/USD slips to four-month lows below 0.70 as Aussie building permits tank 15%

Oil trades in the red on rising US output

EU’s Juncker: Germany, Austria, Netherlands impede Eurozone reform

NZD bullish: New Zealand milk production falls 8% in March – Fonterra

Key Focus Ahead

Today’s macro calendar remains very eventful, with plenty of event risks, with the key US labor market report to steal the limelight and provide fresh USD direction for the coming days. The US payrolls and average hourly earnings data will be reported at 1230 GMT later today, followed by the ISM non-manufacturing PMI at 1400 GMT. Also, of note remains the US Baker Hughes oil rigs count data due at 1700 GMT.

Ahead of the US data, markets look forward to the UK April services PMI release at 0830 GMT, which is expected to improve heading into the second quarter. Next of relevance remains the Eurozone April flash CPI report due at 0900 GMT alongside the PPI release. Meanwhile, the second-tier Swiss consumer confidence and CPI data will be also eyed for some incentives in early dealings.

EUR/USD: Techs lean bearish ahead of US non-farm payrolls

EUR/USD  will likely revisit the recent low of 1.1110, as suggested by technical charts, if the US  non-farm payrolls  and more importantly, the wage-price inflation, scheduled for release at 12:30 GMT today, blows past expectations.

GBP/USD struggles near 1.3040 ahead of UK services PMI, US NFP

The  GBP/USD  pair trades around 1.3040 while heading into the London open on Friday after the BOE’s Brexit pessimism and the broad USD strength hammered it down the previous day. The focus now shifts towards the UK and US fundamentals due later today.

Non-Farm Payrolls: ADP and ISM point in different directions

The median expectation is for 185,000 additions to  non-farm payrolls  in April following March’s 196,000 gain. The ADP and PMI  reports have a different historical correlation with non-farm payrolls.  

US dollar sees upside risks in May – Citibank

Analysts at Citigroup offer their outlook on the US dollar, in light of the Fed’s dovishness and signs of recovery in China.