US Jobless Claims Rise. US Dollar still Happy

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US Jobless Claims Rise. US Dollar still Happy

Normally we would expect a massive decline in US dollar after bad jobs report, but it seems like the trading crowd just don’t care anymore. If anything, the USD (AKA Ms. USA) rose against a bunch of her dancing partners; That’s beside Mr. euro but there are probably different reasons behind the EUR/USD pair dancing moves.

So here is what happened: The number of Americans filing new claims for jobless benefits rose last week for a third straight week, but the underlying trend continued to point to a solidly improving labor market.

Initial claims for state unemployment benefits increased 1,000 to a seasonally adjusted 295,000 for the week ended April 18. Claims for the prior week were unrevised.

Rising USD also could have to do with rising global inflations. In particular, the U.S., Canada, and Australia have all seen improvements in their latest core inflation figures. Meanwhile, the U.K., euro zone, and Japan reported weaker core price levels.

Core CPI trends reveal that lower oil and energy prices are still weighing on overall inflation for the time being, lower oil prices normally send Ms. USA to her happy place.

What’s up with Mr. Euro?

Mr. Euro has been acting in a strange manner today as he rose against major counterparts despite lower than expected data out of the Eurozone.

  • French Flash Manufacturing PMI came in at 48.4 versus the 49.4
  • German Flash Manufacturing PMI in red as well with 51.9 comparing to predicted 53.1

However the EUR/USD pair finally caught up with the news upon New York market open and started the new session with a new bearish sentiment.

EUR/USD: Bearish sentiment below 50% Fibonacci

Suggested positioning: None

Technical reasons: Unable to move above the 38% key Fiboannci level, the pair is moving inside a symmetrical triangle heading towards the Ichimoku cloud. The RSI is heading down towards the neutrality area. Despite the apparent bearish sentiment, we consider this mixed signal and won’t get into a position just yet.

Alternative Scenario: Above 1.078 look for more upside towards 38% Fibonacci at 1.0809

Where I’m setting my stops and limits:

Support Levels Turning Point Resistance Levels
1.055 1.0730 1.0809
1.047 1.0676