Initial Claim at 265K vs 278K estimate. Better jobs trend.
Yesterday the ADP showed more weakness (169K vs 200K estimate). That is not the case with the initial claims data as the current week came in at 265K vs. 278K estimate. The four-week average fell to 279.5K. This is the lowest since May 5, 2000.
The EURUSD fell to new day lows on the claims news and moved closer to the 100 day MA. Yesterday, the 100 day MA was broken and closed above for the 1st time since May 12, 2014. The 100 day MA comes in at the 1.1251. The low reached 1.1261 (see chart above). The pair has rebounded off the lows as traders leaned against the key MA. With most of the data over today (consumer credit comes out at 3 PM), the focus will turn toward the UK election, the shaky stock and bond markets, and with an eye toward the US employment report tomorrow.
Looking at the 5 minute chart, the Asian Pacific low came in at 1.1324. The 50% of the days range is at 1.1326. If intraday traders want to keep more of a downward bias, staying below that would be a level to lean against. More patient traders might look to wait toward the 1.1342-45 area. This area includes the 100 and 200 bar MA and the close from yesterday. For the dip buyers who came in against the 100 day MA, that MA remains a key level to stay above (risk). That level really should be the the line in the sand for traders through the employment tomorrow. When a MA is not broken for a year and you get a break like we saw yesterday, traders will look to lean against that level until broken. On a move below, however, there should be sellers on the disappointment.
