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All Eyes on Payrolls; Whisper Number Creeps to 250K

David Becker
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All Eyes on Payrolls; Whisper Number Creeps to 250K

The dollar firmed up as markets discounted upside risk to today’s payrolls report, with the whisper number pegging a 250k rise versus the median for 210k. EURUSD fell to a 1.3852 low, breaching Thursday’s low, although this is still only 40 pips below yesterday’s high. Euro-zone employment came in in line with expectations, while the PMI was slightly stronger.

Eurozone unemployment was 11.8% in March, unchanged from February, which was revised down from 11.9% reported initially. The labor market has stabilized as growth started to pick up, although disparities across countries remain very high, with national rates ranging from 4.9% in Austria to 25.3% in Spain.

Eurozone April manufacturing PMI revised up to 53.4 from 53.3 reported initially and versus 53.0 in March.

The French reading was increased to 51.2 from 50.9, the German reading revised down to 54.1 from 54.2, but this still means French confidence declined last month, while German confidence improved. The Italian reading rose to 54.0 from 52.4, while the Spanish PMI nudged slightly lower to 52.7 from 52.8. The takeaway is that the PMI numbers are now comfortably in expansion territory which should give the ECB room to hold off on additional monetary policy accommodation.

The EURUSD edged above trend line resistance and is holding just above the 1.3850 level. Momentum is slightly positive as the MACD prints in the black after generated a buy signal on Wednesday. This occurs when the spread (the 12-day moving average minus the 26-day moving average) crosses above the 9-day moving average of the spread. The RSI (relative strength index) moved lower today with price action but is printing near 56, which is on the upper end of the neutral range.

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