NFP versus oil = dollar fate

<p>The oil market continues to dominate proceedings in FX and equity markets, as volatility in black gold reaches unprecedented levels following a 4% price advance […]</p>

The oil market continues to dominate proceedings in FX and equity markets, as volatility in black gold reaches unprecedented levels following a 4% price advance yesterday that came on the back of a 9% move lower on Wednesday and a 6% rally on Tuesday.

The Asian session traded in its usual calm pre-NFP fashion with the only highlight being the RBA’s statement on monetary policy, which probably wasn’t as downbeat as many had expected. The RBA downgraded the 2015 GDP forecast from 2-3% to 1.75-2.75%, as the 2016 estimate was lowered to 2.75-3.75% from the November estimate of 2.5-4%. The CPI forecast for 2015 was not immune to the weaker outlook as inflation expectations were lowered to 2-3% from the 2014 estimate of 2.5-3.5%.

The FX markets will be dominated by the US jobs report today, with the market forecasting 237k jobs to have been created in January. The unemployment rate is expected to dip to 5.5% from 5.6% with the consensus for average hourly earnings looking for a robust 0.4% increase.

 

 

EUR/USD
Supports  1.1300-1.1260-1.1100  | Resistance 1.1535-1.1600-1.1680

 

 

USD/JPY
Supports  116.50-116.05-115.80  Resistance  117.80-118.30-118.80

 

 

GBP/USD
Supports  1.5310-1.5280-1.5205 Resistance  1.5388-1.5450-1.5500

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