Friday, 2 Oct 2009

Dollar Drops on Release of Non-Farm Employment Change

The dollar's instability continued today, as the greenback dropped against all the major currencies, after an anemic September jobs data fueled fears that the pace of a U.S. economic recovery would be slow. The USD fell against the EUR, pushing the oft-traded currency pair to 1.4610. The Dollar experienced similar behavior against the CHF and closed at 1.0345.

Job losses last month reached 263,000, far above expectations, with the unemployment rate rising to 9.8 %, as expected. Investors initially bought the dollar versus the EUR after the release of the jobs data in a flight-to-safety bid. But dollar gains were modest, and analysts suggested caution in buying the U.S. currency amid signs the recovery could stall.

As for the week ahead, many interesting economic information will be released from the leading economies. Traders are advised to pay special attention to U.S Non-Manufacturing PMI scheduled on Monday and to the Europe Minimum Bid Rate which are due to be released on Thursday.

AUD/CHF Provides Bullish Signals

The pair has recorded much bearish behavior today. However, the technical data indicates that this trend may reverse anytime soon. For example, the 4-hour chart's Stochastic Slow signals that a bullish reversal is imminent. An upward trend today is also supported by the RSI. Going long with tight stops may turn out to pay off today.