EUROPEAN session review: market calm before US payrolls data

Data released: 

06:45 GMT Switzerland Unemployment Rate s.a (MoM) (Oct) 3.2% 3.2% 3.2% 

07:00 GMT Germany Exports (MoM) (Sep) 1.7% 0.5% 1.0% 

07:00 GMT Germany Imports (MoM) (Sep) -1.9% 0.6% 0.1% 

07:00 GMT Germany Trade Balance s.a. (Sep) €18.8B €15.5B €15.8B 

07:00 GMT Germany Current Account n.s.a. (Sep) €19.7B €-15.0B €10.1B 

08:15 GMT Real Retail Sales (YoY) (Sep) 1.0% 2.5% 2.5% 

09:30 GMT UK Goods Trade Balance (Sep) £-9.816B £-9.200B £-9.557B 

09:30 GMT UK Total Trade Balance (Sep) £-3.268B £-2.700B £-3.252B 

09:30 GMT UK Trade Balance; non-EU (Sep) £-3.845B £-4.000B £-4.324B 

The market consolidates ahead of the nonfarm payrolls figuresafter sharp moves seen the previous day in the wake of the ECB surprising rate cut and a strong US GDP reading. 

Analysts believe, if payrolls are strong, the string of positive surprises would harden the case for earlier tapering, though there is still more chance for the Fed to move in 2014 and not 2013. 

EURO 

Standard & Poor's on Friday cut France's sovereign rating, citing concerns about the country's growth prospects as reason for the move. The long-term ratings were downgraded by one notch, to AA from AA+, with S&P saying it believes the French government's reforms to taxation, as well to labor and other markets, won't substantially raise the country's medium-term growth prospects. S&P also said ongoing high unemployment is hurting support for further fiscal and structural policy measures. 

EUR/USD sets stable near $1.3410, above yesterday’s lows on $1.3300/90. Initial resistance comes at $1.3450 (Nov 7 hourly high), stronger - at $1.3550 (Nov 6 highs). Initial support comes at yesterday’s lows on $1.3300/90 with a break under widen losses to $1.3170 (61.8% of $1.2755-$1.3832) and $1.3100 (Sep 6 lows). 

POUND 

Data released showed the UK trade deficit rose more than estimated during September, climbing to £9.816 billion vs. £9.557 billion (revised) from the previous month. Forecasts were calling £9.2 billion. 

GBP/USD consolidates within the former range. Initial resistance comes at $1.6120 and $1.6200 (phycological levels). Minor support is around $1.6000 and $1.6000 (Nov 7 lows), below - at $1.5980 (Oct 4 highs) and $1.5900. 

YEN 

The yen corrects after yesterday’s rise. 

USD/JPY holds at Y98.10. Strong resistance comes around Y98.80 (earlier broken channel line) and then - at Y99.40 (Nov 7 highs) and Y100.60 (Sep 11 highs). Support is around Y97.60 (yesterday’s lows) with a stronger one - on the lower bound of the triangle at Y97.30. Break under widens losses to Y96.55 (Oct 7 lows) and Y95.80 (Aug 8 lows). 

Source of information>>

More information>>