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USD gains after NFP miss

USD/JPY – Weekly Candlesticks
Source: GKFX / MT4 (January 10, 2020)

USD/JPY is testing the top of its down-sloping channel upper trendline after forming a bullish engulfing candlestick on the weekly candlestick chart. The price has avoided a weekly close below 103. 

 

TAKEAWAYS


•    Dollar gains on haven appeal after non-farm payrolls disappoints
•    Gold collapses with $60 price drop as dollar rebounds
•    Bitcoin sees weekend dump, breaks pattern of weekend ramp
•    Oil prices extend breakout over $50 pb
•    US indices close at fresh record highs as investors bet on stimulus
•    European stocks have best week in two months
•    DAY AHEAD: China CPI, PPI, BOE Bailey speech

 

GURU WISDOM


“Success usually comes to those who are too busy to be looking for it.” – Henry David Thoreau
 

MARKETS


*Daily closing price
↘ EUR/USD    1.2218        (-0.42%)
↘ GBP/USD    1.3563        (-0.00%)
↗ USD/JPY    103.93        (+0.13%)
↗ S&P 500    3824.68    (+0.55%)
↗ Hang Seng    27,472.81    (+1.20%)
↘ Gold        1848.26    (-3.37%)
↗ Oil (Brent)    44.96        (+3.44%)
↘ Bitcoin    37,809        (-5.88%)
 

NEWS

 

Dollar reasserts 


Gains in the dollar were limited after NFP data. That could be in part because it had already made solid gains across the week in anticipation of the data. The soft data spurred hopes for stimulus. President-elect Joe Biden called for extra $2000 checks as part of a new stimulus bill.
 

Euro stocks


Lockdowns being introduced in several major European countries is being ignored as the vaccination rollout picks up steam. The FTSE 100 has been an outperformer, in part thanks to news that 200,000 Brits are being vaccinated very day.  
 

Gold collapse


The price of gold sank $64 to finish under the critical $1850 handle. The decline was held up by the 200 DMA. A rebound in real yields (Treasury bond yields adjusted for inflation) pulled the yellow metal lower, while the dollar gained ground.
 

Bitcoin gap


There could finally be some signs of a short term top in Bitcoin after the cryptocurrency failed to gap higher over the weekend. The weekend gap has been a bullish signal for the past week weeks. This Sunday the price slumped over 5% before some dip buying eased the losses.
 

Oil breakout


Gains in WTI crude oil accelerated after its breakout above $50 per barrel, reaching the 52 handle on Friday. The cross-asset belief in imminent government stimulus and a resulting economic growth impulse spurred a jump in the oil price. The surprise Saudi output cut has stabilised supply while the demand outlook looks brighter.
 

DAY AHEAD


*Times in GMT 
01:30 – China Producer Price Index (YoY)(Dec) [-0.8 % Exp vs. -1.5 % Prev]
01:30 – China Consumer Price Index (YoY)(Dec) [    0.1 % Exp vs. -0.5 % Prev]
15:00 - BoE's Governor Bailey speech
 

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