Today’s highly anticipated US nonfarm payrolls report failed to live up to expectations.  US dollar bulls paid the price. NFP gains were only 103,000, well below the 190,000 forecast.  The unemployment rate ticked up to 4.1% from 4.0% but a rise in hourly average earnings took some of the sting out of the results. The data is suspect due to weather-related issues at the beginning of the month.

Nevertheless, The US dollar dropped.  EURUSD spiked to 1.2255 from 1.2230, GBPUSD rallied to 1.4035 from 1.4000 and USDJPY dropped to 107.13 from 107.35.  Those moves are being reversed as this is being written.

The Canadian data was good news for the Loonie.  Canada added 32,300 jobs in March exceeding the 20,000 forecast.  Even better Canada added 68,300 full-time jobs. USDCAD dropped from 1.2790 to 1.2736 on the news.  Prices have since bounced to 1.2750.

It was expected to be a quiet Asia and European session.  The hours before the US employment report and its penchant for wreaking havoc on prices tend to put a damper on trading. That wasn’t the case in Asia, at least for a short while.

President Trump told trade officials to find another $100 billion of Chinese imports that he could place tariffs on. He justified the move because China “unfairly” responded to his previous sanctions.

USDJPY dropped on the news, falling from 107.44 to 107.00 USDCHF, the other safe-haven staple sank to 0.9614 from 0.9635.  Both moves were fully reversed before the start of the European session.  The Nikkei dropped, rallied and then dropped into the close.

NZDUSD slid steadily, albeit in a narrow band.  AUDUSD dropped like a stone on the Trump tariff news and rebounded as quick.

It seems that FX traders dismissed Trump’s antics as more bluff and bluster and decided to concentrate on this morning’s US nonfarm payrolls report.  The forecast is for a gain of 190,000 jobs, and many traders expect an upward surprise.

EURUSD rallied in Asia due to a whiff of risk aversion demand and then dropped in Europe. ECB Council member Benoit Coeure said that the US tariffs had tightened market conditions.  That story and the proximity to the NFP release led to EURUSD touching 1.2215 before moving higher as New York started trading.

Sterling was ignored and traded quietly in a 1.3985-1.4020 band.

The intraday USDCAD technicals are bearish while prices are below the 1.2790-1.2810 area supported by the earlier break of support at 1.2940 and 1.2860.  A break below 1.2750 opens the door to further losses to 1.2650.  However, today’s US and Canadian employment data will make a mess of the technicals

Today’s Range: 1.2700-1.2800