Dollar strenghtens on NFP and ISM Manufacturing data
June 1, 2007
The U.S. currency advanced on reports showing an increase in both employment and manufacturing, which are likely to reduce the probability of a cut in borrowing costs by the Federal Reserve later this year. The Fed said in minutes of its May 9 meeting released this week that it still expects a pickup in the economy this year and views inflation as its main concern.
Friday morning at 08:30 the Department of Labor released its closely watched non farm payroll in the month of May, showing that job growth which was above economists expectations.
Non-farm payroll employment increased by 157,000 (vs. 135,000 as the expected number) jobs in May following a downwardly revised increase of 80,000 (vs. previously reported 88,000) jobs in April.
The Labor Department also said that the unemployment rate remained unchanged at 4.5 percent, as economists had expected. The Institute for Supply Management’s index of U.S. factory activity edged up to 55.0 from 54.7 in April.
Strong manufacturing data helped dollar reach a seven week high vs euro at 1.3391.
Today’s Strategy: After a volatile NFP release the market consolidated into a triangle pattern waiting for the ISM Manufacturing. Place a straddle, anticipating breakout from consolidation - BUY order @ 1.3431, SELL order @ 1.3422, with a 10 pip hard stop and 20 pip limit.
Posted by forexsource under Daily Trading Strategy |
