US Money Printing Worries China

The smallest monthly drop in Non-Farm Payrolls in 12 months fueled a EUR/USD surge last Friday afternoon -see Chart.

This trend continued overnight supported by claims printed in the UK Daily Telegraph that China was worried about the level of US money printing.

In addition, early this morning Euro-zone Sentix confidence fall to -14.6 versus an expected -13.7 whilst German Factory Orders rose 3.5% compared to the forecasted 2.0%.

If investors conclude that China concerns about the US money printing policy are real then this could weigh on the USD in coming weeks.

The low holiday trading volumes should consolidate most currency pairs today with the overbought Stochastic, in particular, limiting further EUR/USD advances - see chart.