Yesterday’s anxieties over the upcoming ADP results had been reasonable. The data turned out to be much worse then expected, and the US private sector lost 10 thousand working positions. This decrease was the first after a six-month growth. The market expected step by step manpower growth in the private sector in the process of economic recovery. The current situation is now making questionable nonfarm employment change data for the last, coming out on Friday. The data are expected with some positive reduction from -131 thousand to -118 thousand people. If the situation gets worse, the dollar will find itself under pressure in a mid-term outlook.

Today it’s a good idea to pay attention to ECB press-conference results and short-term interest rate discussion, as well as to the beginning of the American session. At the same time, jobless claims data from the US, with an increase from 473 to 475 thousand, and nonfarm productivity index with a decrease from -0.90% to -1.60%, are also expected to come out today. These data won’t bring any good moods to the greenback. In general, macroeconomic situation doesn’t seem optimistic for the dollar, so we can expect its further descending against its major opponent – the euro.
As for the technical side, yesterday’s fixation above mentioned channel suggests further growth in the pair to 1.2920 and higher. 1.2773 is seen as intraday support level with target 1.2885 and, in case it’s breached, 1.2966.

Analysis prepared by:

Maxim Dmitrievsky
Forex4you analyst