Dollar slips as soft ADP and Fed chair chatter lift EUR/USD; focus shifts to jobless claims and FOMC
The U.S. dollar fell broadly after a softer ADP private payrolls print and a Bloomberg report suggesting Kevin Hassett has emerged as a frontrunner for the next Fed Chair. With markets pricing roughly a three-in-four chance of a December cut, traders are pivoting to jobless claims for near-term direction amid thinning liquidity into Thanksgiving.
Market snapshot
The greenback eased across G10 as rate-cut expectations firmed following recent dovish-leaning remarks from Fed officials, including a fresh endorsement for a December move from John Williams. Futures now imply around a 76% probability of a cut at the next meeting—effectively pre-positioning markets ahead of the decision.
The data calendar is light into the FOMC, concentrating attention on U.S. weekly jobless claims for confirmation that labor-market cooling is intact. Strong claims (i.e., fewer people filing) could give the dollar a short-lived bounce, but the broader focus remains on the policy decision and the subsequent NFP and CPI that will shape the path beyond December.
Across the Atlantic, the ECB continues to signal steady policy, stressing it will not react to small or short-lived deviations from its 2% inflation goal. Recent Eurozone prints align with a neutral tone, keeping the policy divergence narrative subdued for now.
EUR/USD technical setup
Daily chart
EUR/USD remains confined to a broad range between roughly 1.15–1.17, reflecting indecision ahead of the FOMC and key U.S. data. A sustained daily close outside this corridor is needed to unlock momentum.
4-hour view
Intraday, a firm supply zone is capping rallies near 1.1590, where sellers have been defending with risk defined just above resistance. A rejection here favors a return toward 1.1550. A topside break would likely encourage momentum buying toward the next resistance around 1.1670.
1-hour view
Near-term flow is balanced: dip buyers are eyeing 1.1550 with tight risk below 1.1540, while bears will look for a decisive break under 1.1540 to press for new lows. With U.S. Thanksgiving curbing liquidity, intraday ranges may compress, increasing the risk of stop-driven moves around key levels.
What to watch
– U.S. jobless claims today for a read on labor-market momentum and immediate dollar reaction.
– U.S. Thanksgiving holiday likely to dampen participation and keep ranges tight.
– Preliminary inflation data from major Eurozone economies on Friday for confirmation of the ECB’s neutral stance.
– The FOMC decision remains the central driver, followed by NFP and CPI that will recalibrate the medium-term rate path.
Market highlights
- USD weakens after softer ADP and Fed chair speculation; cut odds for December hover near 76%.
- Fed’s Williams reinforces expectations for a December rate reduction.
- Light data into FOMC puts jobless claims in focus for short-term FX direction.
- ECB stays neutral; recent Eurozone data supports a steady policy stance.
- EUR/USD boxed between 1.15–1.17; resistance 1.1590, support 1.1550, breakout targets 1.1670.
- Thanksgiving-thinned liquidity may exacerbate swings around key levels.
Upcoming catalysts
– U.S. Jobless Claims (today)
– U.S. Thanksgiving (tomorrow; reduced liquidity)
– Eurozone flash inflation (Friday)
– FOMC decision, followed by U.S. NFP and CPI
FAQ
Why is the U.S. dollar weaker today?
The dollar fell after softer ADP payrolls and reports that Kevin Hassett is a frontrunner for Fed Chair, both reinforcing expectations for a December rate cut. Markets now price roughly a 76% chance of a move, pressuring the greenback.
What are the key EUR/USD levels to watch?
Range boundaries sit around 1.15–1.17. Intraday resistance is near 1.1590, with support at 1.1550. A break above 1.1590 opens room toward 1.1670, while a drop below 1.1540 would reassert downside momentum.
How could U.S. jobless claims affect FX markets?
Weaker claims (lower filings) could briefly lift the dollar by challenging the magnitude of near-term cuts, while higher claims would support the case for policy easing and weigh further on the greenback. Liquidity around the holiday may amplify the initial move.
What is the ECB’s current stance and why does it matter?
The ECB is signaling steady policy and resisting overreacting to minor inflation deviations. A neutral ECB limits policy divergence with the Fed, helping EUR/USD hold within its prevailing range unless U.S. data or the FOMC shifts the narrative.
Reporting by BPayNews.
