U.S. Dollar Advances Amid Strong Labor Market Data; NFP Report Due

(RTTNews) - The U.S. dollar moved up against its major counterparts in the Asian session on Friday, as the latest economic data pointed to a tight labor market, increasing the possibility of a 50 basis point rate hike by the Federal Reserve at the next meeting to be held on February 1.

Data from the payroll processor ADP showed that private payrolls rose to 235,000 in December, well above expectations of 150,000 and 182,000 in November.

U.S. weekly jobless claims fell to 204,000 from 223,000 in the previous week and the expected level of 225,000.

Expectations for another 50 basis point rate hike by the Fed have grown following the data.

Traders now await the U.S. Labor Department's nonfarm payrolls data due out at 8:30 am ET. Economists expect the employment to rise by 200,000 jobs in December, compared to 263,000 jobs seen in November. The jobless rate is expected to hold steady at 3.7 percent.

The USD/JPY pair reached an 8-day high of 134.42. The greenback is likely to test resistance around the 137.00 area.

The USD/CHF pair touched a 3-day high of 0.9384. The currency is seen finding resistance around the 0.96 level.

The GBP/USD pair dropped to 1.1886. The greenback may locate resistance around the 1.16 level.

The greenback was up against the kiwi, at a 3-day high of 0.6207. Should the greenback strengthens further, 0.60 is found as its resistance level.

The greenback appreciated to 1.0507 against the euro, its highest level since December 12. On the upside, 1.03 is possibly seen as its next resistance level.

The greenback rose to 1.3592 against the loonie and 0.6740 against the aussie, off its early lows of 1.3538 and 0.6788, respectively. The next likely resistance for the greenback is seen around 1.37 against the loonie and 0.665 against the aussie.

Looking ahead, U.K. construction PMI, Eurozone CPI and economic confidence index, all for December, and retail sales for November are due out in the European session.

U.S. and Canadian jobs data, ISM non-manufacturing PMI and Canada Ivey PMI - all for December, as well as U.S. factory orders for November will be out in the New York session.