Wednesday, 5 May 2010

ADP Non-Farm Payrolls Set to Create Heavy Trading

Investor fears that Greece will not be able to successfully execute its long overdue bailout package have led to further losses for the Euro in morning trading. The European currency, still being weighed down after hitting a 1-year low against the U.S. Dollar, has also seen steady losses against the British Pound and Yen. EUR/GBP has seen a drop of over 100 pips since yesterday evening. Similarly, EUR/JPY has tumbled almost 300 pips in less then 24 hours. In the mean time, analysts are now saying the new support line for EUR/USD is likely to be around 1.2880.

Today, traders will want to pay close attention to the U.S. ADP Non-Farm Payrolls report, set to be released at 12:15 GMT. The ADP report is a precursor to Friday's Non-Farm Employment Change Report, and consistently leads to market volatility. The ADP figure is forecasted to show a solid increase in American employment. That being said, the Dollar will not necessarily benefit from a positive figure. Should investors decide that an improved U.S. economy is reason to return to risk taking, the Euro may be able to marginally recoup some of its recent losses.