Major currency pairs traded in narrow ranges during Asian session but dollar bulls remain intact, as the greenback moved higher in early European trading. The dollar was underpinned by another hawkish comment about interest rate hike, this time from Chicago Fed President Evans and series of strong data from US. Upbeat US Non-Manufacturing PMI, released on Wednesday, was added to the list of recent strong releases.
The dollar Index holds firm above $96.00 mark and eyes $96.38 barrier, fresh two-month high, posted on 4 October.
Markets are now focusing on Friday’s US Non-Farm Payrolls report that could reinforce expectations of Fed’s rate hike in December.
Yesterday’s release of US private sector job growth data that is used as indication for NFP release, came weaker than expected, however, stronger-than–expected services sector number, offset the negative impact.
The Euro is probing again below 1.1200 and pressures key supports after bulls were unable to sustain recovery rally, sparked by comments of ECB’s reduction of QE programme.. Sideways trading could be expected before release of US jobs data on Friday that are likely to point at fresh direction.
Sterling remains under pressure and trades near fresh 31-year low at 1.2683, but still holding within near-term consolidation range, which was so far capped under strong barrier at 1.2795. Firmly bearish technical studies and increasing fears about ‘hard Brexit’ keep the pound pressured, seeing scope for bearish extension towards 1.2500 zone initially.
Antipodean currencies, Australian and New Zealand dollars moved lower against their U.S. counterpart on Thursday, as demand for the greenback remained supported by growing hopes for a U.S. rate hike before the end of the year.
Aussie probes below strong technical support at 0.7585, break of which would spark further bearish acceleration, while kiwi dollar’s fresh weakness broke below 0.7200 handle and eyes target at 0.7085.
Gold remains under pressure after strong fall on Tuesday and posted fresh 3 ½ month low at $1262.
Strong dollar on hopes of US rate hike in December and signals of tapering ECB’s stimulus programme, keep gold pressured. The yellow metal trades within narrow consolidation on Thursday, awaiting release of US jobs data.
Wall Street ended higher on Wednesday, with Asian stocks following positive sentiment that is supported by strong US economic data and rising prospect of near-term US rate hike.
MSCI index, the broadest index of Asia-Pacific shares outside Japan, rose 0.4%, while Japan’s Nikkei 225 was up 0.5% on Thursday.
Highlights of the day

Asia
Australia’s trade gap narrowed in August to 2.01 billion A$ from 2.12 billion gap in July and well below forecasted -2.3 billion A$.

Europe
German Factory orders surprised in August, coming at 1.0% against 0.2% forecast and 0.3% in July. Strong demand from domestic customers and from Eurozone countries drove the bigger than expected rise in German Factory orders, suggesting factories will contribute to growth of Europe’s economy in coming months.

America
US Weekly jobless claims are the highlight of American session. No significant changes expected in the week behind, according to forecast for today that stands at 255K, compared to previous release at 254K. Data is due at 12:30 GMT.
Important levels
GOLD
Strong bearish pressure persists, as gold posted fresh low at 1262 yesterday, after sharp fall on Tuesday. Negative sentiment continues to drive yellow metal lower and fresh weakness came ticks ahead of next target at $1260, with extension to $1249 seen likely. First resistance lies at $1277, ahead of $1283 and stronger corrective attempts expected to ideally hold below $1293 barrier. Upper breakpoints lay at $1302/06.
GBPUSD
Overall bias remains firmly on the downside, as the pair consolidates above fresh low at 1.2683. Recovery attempts were so far capped at 1.2769 and are expected to fade ahead of fresh weakness. Initial target at 1.2647 is in near-term focus, with extension seen towards round-figure support at 1.2600. Former key support at 1.2795, now acts as strong resistance and should ideally cap extended upticks.
EURUSD
The Euro is at the back foot after strong hesitation was shown on attempts to break above daily cloud. Fresh weakness is back below 1.1200 handle, with next pivot at 1.1188 being cracked. Stronger downside risk could be expected on break below daily cloud base at 1.1170 that will re-open supports at 1.1138 and key 1.1122 base. Resistances lay at 1.1223 and 1.1240., Market Analysis