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XTB TRADEBEAT

USD takes first tentative steps on the road to recovery despite NFP miss

Summary:

  • USD moving higher after NFP miss. 148k vs 190k exp
  • CAD surges as Canadian jobs data smashes forecasts
  • US500 looking for best weekly gain in more than a year
  • EMU inflation falls and weighs on the Euro 
  • Bitcoin moves back above 16000 to trade at 2-week high

The eagerly anticipated NFP report has been released with a sizable drop in the headline reading causing some disappointment and the immediate reaction seeing the US dollar fall whilst Gold and the US500 popped higher. However, within half an hour this weakness had subsided and the US dollar is higher on the day by the European close. 

Whilst the US NFP report was a little inconclusive as to whether it was good or bad, there is little question regarding its Canadian equivalent which smashed forecasts. The headline employment change rose by 78.6k against forecasts for a 1.8k rise and coming on the back of last month’s 79.5K it appears that the Canadian jobs market is going from strength to strength.

The US500 has extended its recent gains today with the market taking out previous highs to move up into uncharted territory once more. It’s been a good week for equity bulls with the JAP225 having its largest weekly gain since July, the DE30 on course for its best week since April and the US500 looking like it may post its best week since Dec 2016. 

As per market expectations inflation in the Eurozone slowed down in December which can be mostly ascribed to a base effect as the same stories were seen in other European countries except France. On top of that the core rate of inflation failed to speed up sticking to its November’s value. Whilst this didn’t cause a sharp move in the Euro it has potentially imparted a little downward pressure and the single currency has fallen lower on the final trading session of the week. 

Bitcoin has enjoyed a strong rise today of almost 10% with the market moving back above the 16000 level to trade at a price not seen since Boxing Day. The market is looking to extend its recovery from the sharp sell-off seen in the pre-Christmas period and if the market can gain traction then we could see a retest of the all-time high around the 19000 handle. 

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