The broad markets turned in another complicated day before going into the weekend as the U.S. Non Farm Employment Change turned in a dramatically disappointing figure which showed a gain of only 39k (a far cry from the anticipated result of plus 143k) and a rise in the Unemployment Rate to 9.8%. This was coupled by continuing grumblings from Europe concerning the Sovereign Debt crisis. The USD lost ground to the EUR and the GBP on Friday, but the big move came from Gold which climbed around 1410.00 USD an ounce. Gold proved a vibrant choice for traders as the precious metal became a safe haven move as negative sentiment was once again reinforced among the USD and EUR.
Wall Street started Friday off on weak footing with the lackluster job numbers being published, but did regain its equilibrium and turned in a slightly positive day. The big push within the States came from acknowledgement among investors that the Federal Reserve’s intention of quantitative easing is not going to disappear anytime soon and in fact the Central Bank may be tempted to increase its bond purchasing.
This weekend a group of European officials made a statement calling for a unified European Bond issue, but this was quickly rebuffed by German officials who have no public support to be the main creditor for Europe’s financial woes. The news from Europe which centers around discord, and the inability of the U.S. to turn in a good jobless report essentially have set the table for what could become a volatile week of trading as we inch closer to the holiday season.
It will be a relatively quiet day of data with Europe presenting the broad Sentix Investor Confidence reading .The focus from the U.S. is likely to come from any comments coming from the Federal Reserve if Ben Bernanke finds himself making his way to a microphone. Over the weekend Bernanke was quoted as saying that the U.S. unemployment situation may not return to normal for a prolonged amount of time.
This week may prove a test for traders who are trying to grasp the overall sentiment of the currencies as both the USD and EUR face rather poor news prospects. Market participants will have to be ready at the wheel for politicians and government officials who will certainly try to feed the public a party line. The question is which currency will look the best among a parade of ugly entries and because of this Gold may find itself also in a rather volatile mix as risk appetite is put to the test.
Written by bforex.com
