Daily Market Update 04/04/2008

London Session
Published: April 4, 2008 5:17 AM

The final London Session of the week leads market players straight into the much-anticipated release of the March US Non-Farm Payrolls employment report. Traders have been rightfully nervous, limiting participants. As far as the trading environment, liquidity has been thin and activity has been choppy. Heading into the London open, activity was virtually non-existent. Once the clock struck 0700 GMT (0300 EDT), US dollar bears seized the opportunity to crack the Greenback. While the short-term charts offered ideal setups for this to occur (bullish consolidations in EURUSD and GBPUSD), the fundamentals behind the move are unknown. It is likely those that caught the dollar rebound from the Monday lows took profit.

Today's USD slide has been efficient and decisive. Across the board, we have seen little get in the way of straight price movement. The brisk ebb and flow has been forceful, yet orderly. EURUSD jumped from 1.5650 to a peak above 1.5720. Cable has followed the same path, ascending from 1.9950 to 2.0035 at its highs. On the downside, USDCHF slipped below 1.0100, but continues to hold above firm support in the 1.0065 area (100 hour simple moving average, prior lows). USDJPY has held up a bit better with the assistance of EURJPY, which has popped over 50 pips to near the 161.00 zone. Considering the focus on the data to come in a few hours, the London Session has offered traders ample scenarios for profitability.

The number on the minds of all investors, traders, and economists around the globe is -50,000. This is the current analyst consensus for the result of the March reading of US Non-Farm Payrolls, the most-watched statistic of employment. Prior to that number, though, is the jobs data from the United States' neighbor to the north, Canada. This event tends to be extremely volatile for the Canadian Dollar. To wrap up the week, traders will see the March Canadian Ivey Purchasing Mgrs. Index at 1000 EDT, with the expectation of 62.5.


Upcoming Economic Data Releases (New York Session)

0830 EDT Canada - Mar Net Change in Employment, consensus: 15.0k (relevance: high)

0830 EDT Canada - Mar Unemployment Rate, consensus: 5.8% (relevance: medium)

0830 EDT US - Mar Change in Non-Farm Payrolls, consensus: -50k (relevance: CRITICAL)

0830 EDT US - Mar Unemployment Rate, consensus: 5.0% (relevance: medium)

0830 EDT US - Mar Change in Manufacturing Payrolls, consensus: -35k (relevance: medium)

0830 EDT US - Mar Avg. Hourly Earnings, consensus: 0.3% MoM, 3.6% YoY(relevance: medium)

0830 EDT US - Mar Avg. Weekly Earnings, consensus: 33.7 (relevance: low)

1000 EDT Canada - Mar Ivey Purchasing Mgrs. Index, consensus 62.5 (relevance: high)