USD Technical Analysis: Key levels for EURUSD, USDJPY, GBPUSD before jobs data

The US dollar is displaying mixed performance as North American markets open, with major currency pairs confined to tight ranges ahead of the US employment report due at 8:30 a.m. ET. EURUSD has fluctuated within a narrow 16-pip band from 1.1617 to 1.1633 and remains near flat. USDJPY has seen greater volatility, moving in a 68-pip span between 155.53 and 156.21, with the greenback rising 0.27% versus the yen. GBPUSD is 0.09% higher, trading between 1.3523 and 1.3549 over a 26-pip range.

Technically, the tight ranges mean the major pairs are awaiting a catalyst. The employment data could produce breaks of the day's highs or lows, offering directional signals. Knowing the key technical levels—where the bias shifts, the risks, and the targets—is important: reacting only to the data without this knowledge might result in selling into support or buying into resistance, harming a trader's results.

What is anticipated in the US jobs report? Nonfarm payrolls are seen rising by 56,000, with the range of forecasts mostly between 30,000 and 70,000. The unemployment rate is projected to hold at 4.1%, and average hourly earnings are expected to gain 0.3% month-on-month and 3.0% year-on-year. If the data comes in close to estimates, the market reaction may be subdued because the Fed is focusing more on inflation and next week's CPI. A much stronger number could reverse some of the moves driven by Waller yesterday, while a significantly weaker outcome might extend the decline in both US yields and the dollar.

US Treasury yields are mixed in the run-up to the employment report; short-dated maturities have edged up while the long end is nearly unchanged:

• 2-year yield: 4.349%, up 1.5 basis points
• 5-year yield: 4.518%, up 0.9 basis points
• 10-year yield: 4.764%, up 0.2 basis points
• 30-year yield: 5.241%, down 0.2 basis points

The small increase in shorter-term yields suggests a cautious stance before the data, while the stable long end imparts a modest flattening trend to the yield curve.

US stock futures point to a mixed open in premarket trading:

• Dow -63 points
• S&P up 1.29%
• Nasdaq up 105 points

Elsewhere overnight, the Reserve Bank of New Zealand raised rates for the second meeting in a row, but said the next increase is more likely in December than October. Overnight-indexed swaps imply only a 31% probability of a move in October, compared to near-certainty for December. Policymakers still view inflation risks as tilted to the upside but want more time to evaluate the effect of the recent hikes. For the New Zealand dollar, the ongoing tightening bias offers support, but the lower chance of an October hike removes a near-term hawkish catalyst.

In the Middle East, disruption to shipping via the Strait of Hormuz persisted overnight. Just four commodity vessels were tracked crossing on Thursday, far below the 10-day average of 15, as the US-Iran conflict and blockade continue to curb energy flows. Traffic through the Bab el-Mandeb Strait also fell short of the average. The diminished shipping activity sustains supply worries and keeps oil prices on track for their biggest weekly gain since mid-July.