The ADP jobs survey gave the beleaguered US dollar a bit of a boost in early New York trading. ADP employment change for December was 250,000, well above the forecast for a gain of 185,000. Even though this report is notoriously unreliable as a nonfarm payrolls indicator, the greenback gained, modestly. The dollar gains were short-lived and FX markets returned to pre-data levels.

There is a massive snow storm wreaking havoc along the US eastern seaboard suggesting markets will be quieter than usual.

The FOMC minutes were released yesterday afternoon.  Some participants thought they were mildly hawkish due to a reference to “most participants reiterated their support for continuing a gradual approach to raising the target range” for Fed Funds.

The minutes and better than expected ISM Manufacturing PMI and Construction Spending data gave the greenback a bid in Asia trading.  It didn’t last.

AUDUSD dropped from 0.7841 to 0.7816 in early trading and then rallied to 0.7855 by the Europe open, supported by strong Caixin China Services PMI data (Actual 53.9 vs forecast 51.8)  NZDUSD traded in a similar fashion.

USDJPY peaked in early Asia trading and then spent the rest of the overnight session bouncing in a 112.48-112.76 range

EURUSD was in demand in Asia, and it continued that way in Europe., rising from 1.2005 to 1.2054and opening in New York at the top of the range. Strong Markit Services and Composite PMI reports supported EURUSD

Firm UK Housing Prices and healthy  Services PMI data underpinned GBPUSD, which rallied in Europe.

Oil prices popped after the API weekly crude stocks change report was released.  The 4.99 million barrel decline in US crude inventories confirmed the earlier rumour and WTI rose to $62.18. That move was reversed by the US open.

USDCAD was largely ignored overnight. A decent volume of option expiries are lurking in the 1.2480-00 area which  may be discouraging USDCAD sellers.

USDCAD Technical outlook:

USDCAD is consolidating losses from the last week of December  in a narrow 1.2500-1.2550 range, looking for a downside break to extend losses to 1.2440.  A break of 1.2440 puts 1.2250 in play, while a break above 1.2610 negates the downward pressure.  For today, USDCAD support is at 1.2500 and 1.2460.  Resistance is at 1.2550 and 1.2590.

Today’s Range 1.2460-1.2550