09, December 2014

Fundamental analysis

 EUR/USD (a 4-hour chart)

The dollar decreased at the beginning of the week. Earlier the dollar strengthened against all its major competitors. The US employment data supported the US dollar in November.

The US labor market release has certainly become the main event of the previous week. Despite the fact that all the key leading indicators pointed out to the non-farm payrolls decline- we got the maximum growth levels since May 2010. In November employment growth totaled 321 thousand that is much better than traders had expected. The overall unemployment rate remained unchanged - at the level of 5.8%. It should also be noted the average hourly wage increase by 0.4% which can cause the household spending increase. Positive data formed a strong a strong economic growth foundation in the 4th quarter which further increased the US dollar supporters.

The dollar strengthened along the entire market – the USDX index closed at the mark of 89.33 and came close to its eight year high. At the end of the trading day the pair EUR/USD and the pair GBP/USD increased and the pair USD/JPY decreased from the new maximum.

Taking into consideration that other region news will not be released we can consider the foreign exchange market lower activity. However, the impression produced by the US employment data can extend their impact on the market for some time.