The US unemployment rate dropped unexpectedly last month, as companies created more jobs than expected. The Department of Labour reported that US firms added 211K jobs to the economy in April, following the preceding month's revised down increase of 79K jobs and surpassing analysts' expectations for a 194K gain. Data also showed that the unemployment rate fell to 4.4%, down from March's 4.5%, whereas markets anticipated an acceleration to 4.6%. Meanwhile, average hourly earnings rose 0.3% last month, up from March's climb of 0.1% and in line with forecasts. According to analysts' projections, if job creation remains strong, the US labour market will likely hit full employment already this year. Friday's better-than-expected employment report combined with low initial jobless claims and the strong services PMI pushed up the odds of a June hike by the Federal Reserve.
Furthermore, some analysts said that the economy regained positive momentum in the Q1, suggesting that the Fed will likely be forced to raise rates at a quicker than initially expected pace this year.
No important data releases until Wednesday
USD/JPY sets eye on 114.00
Not only did the USD/JPY pair manage to recover from its intraday low yesterday, but even establish a new seven-week high of 113.30. The Greenback refuses to give up the bullish momentum, exploiting the recent recovery further, now aiming to reclaim the 114.00 major level. A successful attempt to reach this area is still likely to be short-lived, amid a tough resistance cluster located a few pips higher. Furthermore, assuming the given pair completely broke out from trading within the descending channel's borders, continued positive outcomes are nothing out of the ordinary, which could even lead to reaching a larger scale down-trend, currently located around 117.00.Daily chart
Bears keep gaining numbers, as 63% of all open positions are now short. Meanwhile, the share of sell orders remains unchanged at 52%.
Right now 55% of OANDA clients are bulls, adding three percent from before, as the bullish sentiment has been holding around the same level for some time now. In the meantime, Saxo Bank clients manage to retain a neutral outlook towards the US Dollar, being that 51% of their open positions are now short and the remaining 49% are long.
Spreads (avg, pip) / Trading volume / Volatility
Traders are becoming increasingly bullish on the Dollar