Article Highlights

  • US NFP report: 295K vs. 225K expected, 239K previous
  • US unemployment rate: 5.5% vs. 5.6% expected, 5.7% previous
  • US average hourly earnings: 0.1% vs. 0.2% expected
  • US trade deficit: 41.8 billion USD vs. 41.2 billion USD expected, 45.6 billion USD previous
  • CA building permits: -12.9% vs. -4.0% expected, 6.1% previous
  • CA trade deficit: 2.45 billion CAD vs. 1 billion CAD expected, 1.22 billion CAD previous
  • CA labor productivity: 0.1% vs. 0.0% expected, 0.2% previous
  • Gold, oil, U.S. equities down on voracious USD demand
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Last Friday was a good day to be a dollar bull thanks to the NFP report and forex trader sentiment supporting the Greenback. Just how strong was the dollar rally anyway?

As mentioned in my London session update, the Greenback started gaining on its European counterparts at the start of London trading. Luckily for the dollar bulls, the party was just getting started.

The much-awaited non-farm payrolls (NFP) report clocked in at 295K when market players were expecting bad weather to drag the report to 225K. Unemployment has also gone down from 5.6% to 5.5%, its lowest reading since May 2008. The U.S. average hourly earnings and trade data missed investor expectations, but not enough to dampen speculations of an earlier-than-expected rate hike from the Fed.

EUR/USD fell by another 120 pips (-1.09%) to 1.0850 throughout the session, with GBP/USD also getting a 134-pip (-0.88%) setback to 1.5052. Meanwhile, USD/JPY jumped to a high of 121.28 before closing 75 pips higher (+0.63%) than its open price to 120.69 and USD/CHF saw a 96-pip rally to .9852.

Even the comdolls got dragged in the dollar show. The Loonie took a big hit after Canada reported worse-than-expected trade and building permits reports. It also didn’t help that oil prices ended the day back below $50 per barrel.

USD/CAD jumped 150 pips (+1.20%) to 1.2612, CAD/JPY fell 57 pips (-0.59%) to 95.69, and AUD/CAD slipped by 30 pips (-0.31%) to .9737.

The Aussie and Kiwi also lost pips thanks to dollar demand dragging on commodity prices. AUD/USD dropped by a whopping 119 pips (-1.52%) to .7719 despite the RBA’s recent less-than-dovish speeches while NZD/USD saw a 132-pip decline (-1.76%) to .7364 on dovish speculations for the RBNZ’s policy statement this week.

Will the dollar’s strength extend to today’s Asian session forex trading? China has printed its trade data over the weekend and so far it hasn’t significantly affected comdoll trading.

Japan is set to prints its current account and final quarterly GDP readings at 12:50 am GMT while Australia will be releasing its ANZ job ads report at 1:30 am GMT. These reports don’t usually affect their respective currencies for long, but keep close tabs in case traders use them to support overall investor sentiment!

See also:

London Session Recap

Bonnie and Clyde, peanut butter and jelly, Kanye West and Kanye West. Some things just go well together.

In forex trading, you get better odds at securing pips when your fundamental analysis is complemented by technical analysis.

Head on to Big Pippin’s Daily Chart Art for some pip-locking technical setups!