• The US Employment report is due out today at 13:30 (GMT). Non-Farm Payrolls are expected to be at 180k vs previous reading of 146k, unemployment rate to remain unchanged at 4.1% and average earnings to tick up to +2.6% yoy vs. previous 2.5%. Again, please pay attention to all three elements of the employment report as the market may react to any of the three, especially average earnings, despite the undisputed fact that Non-Farm Payrolls remain the star. Should the actual data meet the forecast, the USD should strengthen, as the forecasted data are rather favourable for the USD. However, given the last few day’s USD weakness, the reaction may be muted somewhat. Also note that, despite US finance minister Mnuchin, stating that the Davos comment about a weak dollar, did not aim at the USD exchange rates, the low US Dollar may prove to be accommodating for the US economy currently.

• The EUR/USD moved in a sideways manner yesterday with some buying pressures, just breaking the 1.2495 (S1) resistance level (now turned to support). We expect the pair to continue to trade in sideways manner, however we see the case for the pair to experience bearish pressures, as the greenback may strengthen due to today’s employment report. Should the pair come under buying interest, we could see it reaching or even breaking the 1.2600 (R1) resistance level. On the other hand should it come under selling interest we expect it to break the 1.2495 (S1) support level and maybe even breaching the 1.2355(S2) support level.

Bitcoin dropping below late November levels

• Bitcoin dropped yesterday beyond the late November levels when the rally had started. Key reason for the drop could be the Indian government’s expressed intention to ban cryptocurrency trading altogether. Also, another reason could be that Facebook could ban all advertisements promoting cryptocurrencies. On the crypto futures front, media reports suggest that CME takes a cautious stand towards introducing other cryptocurrencies after one and a half month of Bitcoin trading. Bitcoins downward trend seems to be followed by most cryptocurrencies confirming its role as a trend setter in the market. We stand by our view that as regulatory authorities intensify their efforts to regulate cryptocurrencies, Bitcoin’s value will continue to drop and that the bears will continue to have the upper hand in the market in the long run.

• Bitcoin dropped yesterday breaking the 8920(R1) support level (now turned to resistance), totally erasing the profits it had posted until the 18th of December. We see the bears to continue to have the upper hand on the bitcoin market in the long run and the price to drop even further. Should the cryptocurrency find fresh buying orders it may stabilize in the short term and even break the 8920 (R1) resistance level. Should on the other hand the selling pressures continue, Bitcoin could break the 7470 (S1) support line and hover below it.

As for today’s other economic highlights:

• During the European morning we get UK’s Markit/CIPS construction PMI. Later on, as analyzed before, the US employment report is to be released. As for today’s speakers, please note that ECB Board member Benoit Coeure, France Central Bank’s governor Villeroy, Ireland Central Bank’s head Lane, Dallas Fed President Kaplan and San Francisco Fed President Williams speak today.

EUR/USD

• Support: 1.2495(S1), 1.2355(S2), 1.2230(S3)

• Resistance: 1.2600(R1), 1.2770(R2), 1.2880(R3)

BTC

• Support: 7470(S1), 6285(S2), 4720(S3)

• Resistance: 8920(R1), 10500(R2), 12000(R3)