Global macro overview for 02/09/2016:
The most important and highly anticipated macroeconomic event of the month (or maybe even the year) has finally arrived: the US Non-Farm Employment Change data will be released today at 12:30pm GMT. The reason why it is a crucial data release is quite simple: if the NFP figure will be better than expected new 180 000 jobs, the odds for FED to hike the funds rate at the nearest meeting in September 21st will dramatically increase (currently, according to CME FedWatch tool, the probability for a 25-50bp hike is 76% and probability for 50-75bp hike is 24%). The catalyst for renewed optimism about a rate hike was FED Chairperson Janet Yellen's upbeat speech about the US economy at the Jackson Hole economic conference and her broad hint that the case for a rate hike had strengthened. Moreover, two of the FED policymakers supported this view during the next day interviews in the financial mass media. In conclusion, today might be the big day for the US Dollar bulls and in a case of a failure, the next possible rate hike date is FED's meeting in December 2016.
Let's take a look at the US Dollar technical picture in the daily time frame. Bulls have managed to retrace 61% of the previous swing down and now the market awaits the NFP data to continue to move higher (if NFP is bigger than 180k) or decline lower (if NFP is lower than 180k). The next resistance is seen at the level of 96.52 and then 97.60. On the other hand, the next support is seen at the level of 95.32 and then 95.00.
