Technical Levels for NFP Friday

August 6 2012

Todays big question is will the dollar soar after NFP, or will it be another US employment let down? either way point & figure charts show you the possible key battlegrounds.

EURUSD

EURUSD 20 Pip Chart http://www.eightdragonscapital.com

EURUSD made a failed attempt to break 1.1900, and has since given a sell signal at 1.1840. If NFP is USD supportive expect a test of 1.1780/60. A break here and trade at 1.1740 would likely signal a deeper sell off towards 1.1700/1.1680.

A weak NFP headline would see the EURUSD back above 1.1840/60 to test 1.1880/1.1900 a break of 1.1900 would target 1.1940/60 in extension.

GBPUSD

GBPUSD 20 Pip Chart http://www.eightdragonscapital.com

The GBPUSD has made a strong recovery from the low of 1.3580, however it failed to break 1.3980/1.4000 and has been in a consolidation pattern trading 40 pips either side of 1.3910 for most of this week.

The downside risk from a strong NFP would put 1.3860/40 support under pressure, a break down here would see the GBPUSD slide to 1.3800/1.3780 or even 1.3740 in extension if the USD gets some real momentum.

On the upside GBPUSD has struggled to get back above 1.3940/60. However, if broken I would expect the next resistance to be at 1.3980/1.4000. I think you need to see a really bad NFP headline for the GBPUSD to break above 1.4000.

AUDUSD

AUDUSD 20 Pip Chart http://eightdragonscapital.com

The AUDUSD looks to have been unsuccessful in its attempt to break above 0.7400. After a failed break you usually see a drop to test support. In this case AUDUSD support is at 0.7320/0.7300. The upside failure makes the AUDUSD particularly vulnerable to a strong USD NFP headline. If we do see a strong number a break of 0.7300 would likely see the AUD heading south towards 0.7220/0.7200

The outlook for the AUDUSD would only brighten if it can sustain a break above 0.7400 which would set a target at 0.7440/60.

Good luck trading today and what ever you do ensure you use sensible risk management.

Published by Neil Callard

Forex Trader and Educator. 30 years trading experience, of which 20 years was market making in major currencies in large international financial institutions.

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