The US jobs report came close enough to expectations, including revisions. The NFP came in at 431K from an estimate of 490K, but the prior month was revised higher by 72K to 750K from 678K. The January revision added another +23K. The unemployment rate was below 3.6% (from 3.7%). Goods-producing jobs have increased by 200,000 over the past 3 months. Service jobs added 1463K during this period. Leisure and hospitality added 112,000, while higher-paying professional and business services added 100,000 for the 2nd month in a row.

The report keeps the Fed on target for one or more 50 basis point hikes at the May meeting and most likely June as well. This would bring the target rate to 1.25% to 1.50%. This leaves 4 meetings at the end of the year. Hikes of 25 basis points each time bring the target rate to 2.25% to 2.5%, what is called the neutral rate that Fed officials talk about.

Current 2-year-plus rates are currently close to these levels, doing the Fed’s job for them:

• 2 years, 2.462%
• 5 years, 2.56%
• 10 years, 2.386%
• 30 years, 2.436%

The 2 to 10 year yield curve inverted today at -7.6 basis points which tends to suggest a recession thereafter. When that happens, it may be delayed, but the bond market is hoping that inflation – which currently sits north of 7% – starts to come down. Otherwise, there is certainly still room for returns.

In forex, the , AUD and USD ended the day as the strongest of the major currencies, while the JPY was the weakest.

USDJPY broke its 3-day low after rising for most of March. The pair’s correction off the high blocked this week’s drop near 38.2% at 121.12 (the low hit 121.29 this week before reversing higher today).

EURUSD attempted to break back below the ubiquitous 200 hourly moving average once again today after breaking it on Tuesday’s upside. The 200-hour moving average stands at 1.10405. The low price reached 1.10272 before bouncing higher and closing near 1.1049. The 200-hour MA will be a key barometer in early trading next week.

GBPUSD fell back below its 100 hourly MA at 1.31196 but found willing buyers near a swing zone of support between 1.30783 and 1.30878 (lowest reached 1.30855. Price has bounced near 1.3115 – just below the 100 hourly MA Next week the pair will use this 100 hourly MA as a first barometer Moving above is more bullish Staying below allows sellers to keep control.

USDCHF fell below its 100- and 200-day MAs in yesterday’s session at 0.9234 and 0.9211 respectively, but rebounded higher today. However, the day’s high stopped just off the declining 100-hour MA (currently at 0.9272, increasing its importance in the new trading week). A move above the 100 hour MA is needed to reassure buyers. Conversely, a move back below the 100-day MA at 0.9234 would boost sellers’ confidence.

The USDCAD was able to extend above the 200 hourly MA (and close above it on the hourly chart) at 1.25216 for the first time since March 15th. However, the momentum stopped and the price moved back into the 200 hourly MA above the 100 hourly MA. box below. The 200-hour MA is at 1.25216. The 100-hour MA is at 1.2500. The closing price is at 1.2509. These MAs continue to be the levels that will help define the bias in the new week. PS MAs flatten and converge. The market is therefore preparing to move next week.

Speaking of confined trading ranges, the AUDUSD is on day 8 of a 90 pip trading range. Its 100 and 200 hour MAs converge at 0.7497. The closing price is 0.7496. Something has to give. Either you go up and keep moving higher above 0.7539, or you move below the moving averages and crack below 0.74497.

In the NZDUSD, it rallied in the European session, erasing the decline in the Asian sessions, but stalled near its 200 hourly MA at 0.6944. The ensuing drop took the price below its 100-day moving average at 0.69054, but found support against the 38.2% retracement of the rise from the March 15 low at 0.68946. The price rallied at the close and ends the day near 0.6920. This takes the price below the 100 hourly moving average at 0.6934, but above its 200 day moving average at 0.69054. Traders will be watching these levels for hints of bias early next week.

On other markets to end the week:

• Spot gold was down all dollars and down $0.71 today or -0.66% at $1923.61. The we low price stalled its 61.8% retracement of the upward move from the January 28 low near $1890.51. The closing price is near the 50% midpoint of that same range at $1924.86
• WTI Crude Oil settled at $99.27 and is trading at $99.42 after hours. The closing level last Friday was $113.90. So for the week, there was a strong downward trend as China Covid, and at times, hope for de-escalation of war in Ukraine drove prices down
• Bitcoin is trading at $46,339 heading into the weekend. Of course, 24/7 digital currency trading. This week’s high price extended towards its 200-day moving average of $48,322.29, but found willing sellers against this key moving average level (high price reached $48,234)

I wish everyone a happy and safe weekend