The dollar rallied broadly on Friday after October nonfarm payrolls beat forecasts and the unemployment rate fell unexpectedly.
Nonfarm payrolls rose 165k last month, cruising past the Reuters consensus forecast of 65k and easily surpassing the previous month's rise of 29k. The unemployment rate fell to 4.1%. Economists had expected it to hold at the previous month's rate of 4.2%
Treasury yields rose, led by the front end, and US-German two-year spreads widened. Lingering concerns over AI and tech stocks also supported the dollar. Gold traded lower, and USD/CNH rallied toward 6.6735, which helped sink EUR/USD.
EUR/USD opened in New York near 1.1175 after trading as high as 1.1234 overnight. It extended its drop to a six-session low of 1.1132 and was near 1.1140 late. Technicals lean bearish, with falling RSIs signaling downward momentum. The pair has also formed a monthly gravestone doji and also fell below its 10- and 21-day moving averages.
GBP/USD held at 1.3350 in the New York afternoon, near session lows. Thursday's hawkish Bank of England hike faded as the US-UK rate differential headed back toward something like convergence. LSEG's IRPR still shows a slight UK yield advantage through 2027.
Support in cable lies at Friday's 1.3343 low, then the rising 30-day moving average at 1.3310 and 1.3274, the October 28 low. Resistance is at 1.3370, the 100-DMA, then 1.3428 and 1.3501.
AUD/USD slid to an eight-month low of 0.6855, bounced to 0.6893, then neared 0.6860 again as dollar buying persisted. It opened near 0.6875 after trading at 0.6942 overnight. The pair broke the base of a pennant on the monthly chart, and falling RSIs are bearish. It also trades below its 10- and 21-DMAs and the 0.6990 area.
USD/JPY held a narrow range as the payrolls lift faded. US equities remain the short-term driver. Tech has rebounded, but lingering concerns cap the topside. Treasury yields and oil are well off recent highs, which favors the yen. Resistance sits at 158.90-159.00, with support at 157.27, then 156.50 and 156.00.
The S&P 500 was trading 0.5% higher in New York afternoon as technology stocks bounced back from their worst drubbing in more than a year.
WTI crude gained 0.50%.
Copper was down 0.14%.
Gold fell 0.60%.
Heading toward the close: EUR/USD -0.7%, USD/JPY +0.53%, GBP/USD -0.73%, AUD/USD -0.9%, DXY +0.75%, EUR/JPY -0.15%, GBP/JPY -0.22%, AUD/JPY -0.42%.(Burton Frierson)
