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NFP prints at 339k vs estimates of 190k, ave earnings in line at 0.3% MoM

EUR/USD Flag Break Hinges on US Data, FOMC Tomorrow

EUR/USD Flag Break Hinges on US Data, FOMC Tomorrow

Christopher Vecchio, CFA,

Talking Points:

- EUR/USD persists below TL from April, July, August lows.

- Three "high" rated US data releases ahead of tomorrow's FOMC.

- See the October forex seasonality report that favors US Dollar weakness.

In any other week, the US Durable Goods Orders report, the US Consumer Confidence report, and the US Advanced Trade Goods report would all be considered significant market moving events. However, with the October FOMC meeting due up on Wednesday, these "high" rated events have been dwarfed, and it's likely that the calmer pre-central bank meeting trading conditions prevail.

In turn, the two reports due out today - the September US Durable Goods Orders report and the October US Consumer Confidence report - will likely only have a brief, passing impact on markets. Only significant deviations from expectations will spark these data into potentially game changing events.

The data may not be entirely neutered, however, as the two pieces today offer insight into the soul of the American consumer, the backbone of the US economy. Any further evidence that the US economy is slowing, a data trend that's started to sink in over the past few weeks (in tandem with disappointing growth figures emerging from the rest of the globe), and the Federal Reserve may be effectively boxed out of a rate hike in 2015, regardless of what they say in their policy statement tomorrow.

Elsewhere, the EUR-crosses continue to exhibit signs of weakness. EUR/AUD, EUR/GBP, and EUR/USD all provide compelling evidence to the idea that the Euro, broadly, is on the verge of another leg lower. See the above video for technical considerations in these pairs plus in GBP/USD, GBP/JPY, and the USDOLLAR Index.

Read more: Next Leg Lower in EUR-crosses May Have Started

--- Written by Christopher Vecchio, Currency Strategist

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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.