December Treasury Bonds are trading higher this morning after ADP employment services released a weaker-than-expected jobs outlook. Investors were trading an increase of 20,000 jobs, the actual report showed a decline of 39,000. This not so great ADP report shows there is simply no upside momentum in the jobs market. Treasury Bonds were being underpinned by the news because it supports trader conviction that quantitative easing is coming from the Fed. The number also reflects that while there is not a lot of firing going on, businesses are not hiring. Technically, the Dec. T-bond is nearing downtrending resistance at 134’22. Uptrending Gann angle support is at 133’13. The U.S. Dollar added to its already weak condition with another break to the downside versus most major currencies after ADP reported lower-than-expected jobs data. Traders are reacting negatively toward the Dollar because the report came out on the wrong side of zero. Economists had forecast an increase of 20,000; the actual number was reported at -39,000. The ADP report is disappointing but not unexpected given the weakness in the economy. This report may also be suggesting the beginning of a new contraction in the jobs market. Based on the ADP number traders are looking for a loss of about 10,000 jobs in this Friday’s Non-Farm Payrolls Report. The December Euro continued to inch toward the major Fibonacci retracement level at 1.3896 overnight. Traders should watch for profit-taking or a technical bounce if this area is tested today. The Euro rallied following the release of the ADP report but failed to take out the overnight high at 1.3880. This pattern suggests the pace of the rally may be slowing, but does not indicate a change in trend is imminent. The December Japanese Yen rallied sharply higher after ADP released its jobs data. The weaker-than-expected employment number weakened the Dollar against the Yen because it supports the Fed’s case for additional quantitative easing. The Yen rallied through the “intervention top” at 1.2077, hitting stops up to 1.2108. There was no sign of fresh buying over 1.2077, only short-covering. Bullish traders are likely to take a cautious approach as this currency pair nears the psychological resistance at 1.2200. Some analysts have identified this level as the line in the sand for the Bank of Japan. Look for light buying pressure to continue up to 1.2195 as traders watch for signs of Japanese central bank activity. Bullish traders may get a free pass during the New York trading session since the BoJ last intervened during the Asian session. What is clear is no one wants to get caught long during an intervention especially those holding profitable positions.

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