There isn't too much happening in the major currencies space to start the new week. The US jobs report on Friday here served to reaffirm a 25 bps rate cut by the Fed this month. And that's basically the signal that market players are having to work with right now. The odds of such a rate cut are now at ~86%.
The headline non-farm payrolls figure may be "strong" but again, it's likely skewed due to the poor October showing. That was largely due to adverse weather from Hurricane Milton and the Boeing strike. Meanwhile, the unemployment rate ticked up to match its highest since July and is 0.8% higher than the cycle low. That reaffirms a weakening labour market.
At the balance, it reaffirms the odds of the Fed cutting again before potentially pausing to reassess conditions under Trump's presidency next year. The US CPI report this week is the next key risk event to watch but it shouldn't offer too much barring any major surprises.
For now though, market players might have to wait on that to firm up further their convictions before the Fed next week.
USD/JPY continues to stay more rangebound in and around 150.00 while EUR/USD had a brief look above 1.0600 after the Friday jobs report but is now back down to roughly 1.0550. The low earlier moved to test the confluence of its key hourly moving averages at 1.0536 currently.
Besides that, AUD/USD remains pinned down close to the August lows as it flirts with a firmer break under 0.6400. And USD/CAD looks to be wanting to secure a major technical breakout above 1.4100. So, that's one chart to watch out for in December trading that could really intrigue going into next year.
