Market Snapshot – All Eyes on the NFP

NFP Would be Key for Direction

It is likely to be a key day today with all eyes on the dollar and the NFP that will be released shortly. The ADP employment data that came in yesterday missed its mark and increasing fears that the trend of bad data from the US would continue for the coming month as well. This is the last thing that the dollar bulls would want though. They would hope that the NFP data would not follow the ADP data and bring in some bad numbers as this could effectively extinguish any hopes that the dollar bulls would have of the rates being hiked in the US anytime soon. We have the central banks of the UK and BOC actively talking about rate hikes and the ECB talking about tapering and so any kind of bad data from the US could easily sink the dollar.

Gold Likely to be Choppy

Gold prices hug on to the lows of its range for dear life as the traders await the NFP data a bit later from now. The gold bulls are hoping for some bad data from the US in the hope that they could launch a recovery in the gold prices but even in such a situation, it remains to be seen how much gold can recover considering the fact that the yields are much better in other instruments and there is a likelihood that the funds might be moved over there in anticipation of that. The flash crash in silver would also have dented the confidence of investors and so it could be a tight call on what the market reaction would be to weaker US data.