The dollar surrendered gains it made on an initially well-received U.S. jobs report nL1N2G01W as enthusiasm over the data withered under deeper scrutiny and dip-buyers saved the NASDAQ from collapsing below 50-day moving average support.
Though EUR/USD struck the week's low before its afternoon bounce, it avoided falling beneath last week's trough, extending its streak to 10 weeks of successively higher lows.
It also avoided closing below the pivotal 30-day moving average at 1.1825, which it hasn't done since May nL1N2G10NX.
The question for the upcoming holiday-shortened week is whether this is another buy-the-dip moment for stock markets in the low-yield era of TINA -- there is no alternative -- investing or the start of a protracted setback that undermines dollar- and yen-funded risk trades nL1N2G1121.
Dip-buyers' defense of the tech-heavy NASDAQ 100's pivotal 50-day moving average line was crucial.
A daily close below it could trigger a broader retreat.
Haven yen gains during the post-payrolls and stocks slide fizzled, except against the dollar.
USD/JPY’s 106.50 high once again found supply by the falling 55-DMA that it’s repeatedly failed to close above since early July.
But buyers were again found by 106, assisted by a major rebound in Treasury yields begun Thursday ahead of next week’s 3-, 10- and 30-year Treasury auctions and on the employment data, even though temporary hiring for the 2020 census accounted for nearly a fifth of the jobs gains.
USD/JPY remained in the 105-107 range it has occupied since July’s 104.20 spike low nL1N2G11FN.
Sterling rebounded from seven-session lows, though EUR/GBP bounced from Thursday’s low by the 61.8% Fibo of the April-June rise at 0.8864 as Brexit worries mount nL1N2G11AEnL1N2G10KQ.
AUD/USD and AUD/JPY found support above 30-DMA and 21-DMA pivot points, even amid testing Australia-China relations nL4N2G11X9 and signs of tops in metals prices.
USD/CNY hovered above its key 200-week moving average support, though some investors are betting China wants a strong yuan nL4N2G02BW, which could support emerging market currencies.
WTI fell with stocks, but also amid bearish price reversal signals, a pending dollar recovery and rebounding Treasury yields.
Stocks will remain in focus next week and Thursday’s ECB meeting will also take the spotlight, specifically for any indication of further easing and discomfort with euro gains given euro zone's August deflationary warning nL8N2FY2F6.
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