US JOLTS Job Openings, the Fed’s favorite job indicator, beat expectations by hitting a new cycle high of 4.97 million in the month of November.
EUR/USD, which was already on the downfall, ticked just a bit below the previous low and hit a new low since 2009 at 1.1752. If we take just one step back, it is easy to see that 1.1750 is a double bottom.
Despite being a lagging indicator, Bernanke and now Yellen see JOLTs as an important figure for assessing the health of the job market, which looks – healthy.
One specific component to look at is the Quits figure – how many people voluntarily left their jobs. Here we have a small slide: 2.618 million instead of 2.712 million in October. Nevertheless, also here we have levels last seen in the previous decade. So while there isn’t a new acceleration, jobs are being created at a solid pace.
Eventually, when people change jobs they usually get higher wages. The most recent NFP report showed a good gain in jobs but a very disappointing fall in wages.
Other US figures were positive as well: IBD/TIPP Economic Optimism rose to 51.5 points, above 48.9 expected and 48.4 beforehand. The NFIB Small Business Index advanced from 98.1 to 100.4 points, also beating predictions that stood at 98.6 points.
EUR/USD
The world’s most popular pair was already trending down before the publication and hit a new low immediately afterwards. The pair previously hit these levels on January 8th.
Was the market actually expecting a better figure? Or did the pair just bounce off strong support and does not have the momentum to go lower? I pick the latter.
In any case, 1.17 serves as lower support, followed by 1.1630 and 1.15. On the topside, we have 1.18, which is a round number and weak resistance, followed by 1.1867 – the 2010 low.
What’s next for the pair?
Here is one thought: Why EUR Sell-Off Is Set To Extend Even If ECB Disappoints – HSBC
And here is how it looks on the chart:
