ForexLive Americas Wrap April 3, 2013: US Economy Stumbles

Forex trading headlines for the US session:

ISM non-manufacturing March 54.4 vs 55.5 exp
ADP employment March +158K vs +200K exp
Fed's Tarullo says more need to be done to end the ‘too-big-to-fail' problem
Fed's Williams: Could taper bond buys in summer
Fed's Bullard says ‘spring swoon' in economy not necessarily likely
Bill Gross' latest investment outlook
Brazilian services PMI hits 7-month low
Gold touches lowest since June 2012
S&P 500 down 1.1% to 1554
JPY leads, USD lags

Soft US economic data translated into a soft US dollar. It was interesting to see the soft numbers trump hawkish comments from Williams. It shows that the Fed has successfully shifted the market toward its economic guidance and away from overreacting to every grumble.

The reaction in USD/JPY was straightforward. After the ADP number the pair broke below yesterday's US low of 93.28. The market began to sniff out a soft ISM non-manufacturing number as well. When the weak number was confirmed, 93.00 gave way down to a low of 92.71. Slight bounce in the last 30 minutes, perhaps as intraday shorts are covered ahead of the BOJ decision.

Gold broke the Feb low of $1555 but has rebounded to $1559 so the bulls can take some solace in that. Down below is an all important triple bottom at $1522.

Don't forget to take part in the non-farm payrolls contest.