The positive job data will also inevitably bring us back to the FED tapering debate and when the market expects this to happen but most analysts aren't forecasting this to happen till March time though some are erring on the earlier side, potentially even in Jan or Feb. This should lead to strength coming back into the USD, though we also have to bear in mind that the Republicans & Democrats still have to thrash out a Debt ceiling deal in February which is always a bit of a pantomime so might see some volatility around these upcoming months.
Taking a look at the charts, we've seen some positive price action recently, with a breakout of the Symmetrical Triangle chart pattern in mid-November which started forming back in May, giving us an upside target of 109.00. Before we can get too excited about this, we still need to negotiate the previous significant high of 103.73 reached back in 22nd May of this year. In such a steeply trending market we need to be prepared for some aggressive consolidation / pullbacks and so the RSI and 20day SMA are very useful trading tools in these cases, and will help going forward. The long term chart however paints quite a different picture. We still are in a downtrend and approaching some heavy resistance from the top of the down trend channel, previous support-turned resistance area (102.00/103.00) and 38.2% Fib retracement of the down move started back in 1998 at 102.96. On a break through on the upside, the next key levels are 109.00 (as mentioned earlier) and 50% Fib retracement level at 111.27.
Charts sourced from ig.com
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