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U.S. Nonfarm Payrolls Declines Less Than Economists Expectations, Unemployment Rate Rises to 9.6%

By Michael Wright, Currency Analyst
03 September 2010 13:01 GMT

Taking a look at the breakdown of the report, the private sector jumped 67,000, with most of the gains in education and healthcare. Also worth noting, the average hourly earnings rose 0.3 percent, which is up from 0.2 percent in July, while annualized earnings increased 1.7 percent. Some traders may overlook the report as much of the jobs that were created were part-time/temporary positions. There is not too much to be optimistic about as the labor market in the world’s largest economy is still depressed.

U.S._Unemployment_Rate_Rises_to_9.6_Percent_body_1.jpg, U.S. Nonfarm Payrolls Declines Less Than Economists Expectations, Unemployment Rate Rises to 9.6%

Prepared by Michael Wright

USD/JPY Intraday Chart

U.S._Unemployment_Rate_Rises_to_9.6_Percent_body_usdjpy.png, U.S. Nonfarm Payrolls Declines Less Than Economists Expectations, Unemployment Rate Rises to 9.6%

Source: Intellicharts – Prepared by Michael Wright

Following the “better” than expected report, the USDJPY pushed higher and now looks poised to maintain its northern journey going into the North American trade.

USDJPY Daily Chart

U.S._Unemployment_Rate_Rises_to_9.6_Percent_body_usdjpy2.png, U.S. Nonfarm Payrolls Declines Less Than Economists Expectations, Unemployment Rate Rises to 9.6%

Source: Intellicharts – Prepared by Michael Wright

Taking a look at the USDJPY daily chart, the pair has worked its way into a descending channel. As of late, the end of the trend may be on the horizon as the pair once again tests the upper bounds of the range. If we see a clear break and close above the 20-day moving average, this will validate a potential profitable long trade. At the same time, our speculative sentiment index is slowly scaling back from its extreme levels. A reversal will point to USDJPY gains.

Written by Michael Wright, Currency Analyst

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Michael Wright is the author of FX Headlines, Fundamentals vs. Technical’s, Weekly Spotlight, and Forex Trading Weekly Forecast

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.
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03 September 2010 13:01 GMT