FED: Beige Book: Downbeat On Labor Market Conditions (3/3)
Jun-04 18:44
On the labor market front, the Beige Book reports "Employment has been little changed since the previous report", though the overall tone was downbeat, with some signs of easing wage pressures.
- 7 of 12 districts saw flat/stable/steady employment changes (up from 4 prior). 3 saw modest/slight increases (5 prior), with 2 seeing headcounts decrease (3 prior).
- From the Beige Book summary: "Many Districts reported lower employee turnover rates and more applicants for open positions. Comments about uncertainty delaying hiring were widespread. All Districts described lower labor demand, citing declining hours worked and overtime, hiring pauses, and staff reduction plans. Some Districts reported layoffs in certain sectors, but these layoffs were not pervasive. Two Districts noted that, for many of their contacts, hiring plans had not changed since the start of the year. Wages continued to grow at a modest pace, although many Districts reported a general easing in wage pressures. A few Districts indicated that higher costs of living continued to put upward pressure on wages."
- See summary table below:
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STIR: Jun'25 SOFR Put Condor Buy - Looking for More
May-05 18:31
- +15,000 SFRM5 95.68/95.75/95.81/95.87 put condors, 2.0 ref 95.78
USDJPY TECHS: Resistance At The 50-Day EMA Remains Intact
May-05 18:30
- RES 4: 149.28 High Apr 3
- RES 3: 148.27 High Apr 9
- RES 2: 146.60 50-day EMA
- RES 1: 145.92 High May 2
- PRICE: 143.88 @ 15:03 BST May 5
- SUP 1: 142.88/141.97 Low MAy 1 / Apr 29
- SUP 2: 139.79 1.382 proj of the Feb 12 - Mar 11 - 28 price swing
- SUP 3: 138.82 1.500 proj of the Feb 12 - Mar 11 - 28 price swing
- SUP 4: 138.07 Low Jul 28 ‘23
Recent gains in USDJPY resulted in a move through the 20-day EMA, undermining the bear trend. However, price action remains below resistance at the 50-day EMA, at 146.60. A clear break of this average would highlight a possible reversal. For now, gains are considered corrective. Moving average studies remain in a bear-mode position highlighting a dominant downtrend. A resumption of the trend would open 139.79 next, a Fibonacci projection.
FOREX: Tale of Two Halves as Greenback Recovers Following US Data
May-05 18:11
- Initially on Monday, the US dollar traded weaker against all others in G10, as traders were happy to erode a portion of the post-NFP advance and resume the underlying trend of greenback selling. However, firmer-than-expected ISM services data assisted a solid rebound, with dollar indices now only trading in moderately negative territory as we approach the APAC crossover.
- US ISM Services Index data rose to the highest level since January 2023, and the higher-than-expected prices paid component (65.1 vs. 61.4 est.) has provided further impetus for the greenback recovery.
- This has helped the likes of EUR and GBP to edge back towards unchanged on the session, the clear underperformers in G10. For EURUSD, this translates to the pair reversing around 65 pips from session highs to trade back at 1.13. Initial key support to watch is the 20-day EMA, at 1.1264.
- A similar move for GBPUSD has seen spot narrow the gap to overnight lows of 1.3257. A bearish tweezer top formation on the daily candle chart last Monday/Tuesday highlights a short-term top. Support to watch lies at 1.3225, the 20-day EMA. A break of this level would signal scope for a deeper retracement.
- AUD remains among the best performers after an extended period of consolidation, AUDUSD is gaining following the surprisingly strong showing for Anthony Albanese in the weekend's general elections. The price action puts the rate above the 200-dma and a close above would be the first since November last year.
- Despite the dollar rebound, USDJPY remains 0.6% lower on the session at 144.10, with technical resistance levels remaining intact for now. Moving average studies remain in a bear-mode position highlighting a dominant downtrend. Lower-than-forecast inflation data in Switzerland did little to knock the ongoing optimism for the Swiss Franc. Key USDCHF resistance remain intact at 0.8333, the 2023 low and breakdown point.
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