USD rebounds ahead of NFP as Asian and European markets show mixed signals

The US dollar staged a pre-NFP rebound during Asian and European trading hours, recovering from recent weakness as markets adopted a cautious stance ahead of crucial employment data. Asian equity markets displayed mixed performance, with Chinese indices underperforming amid ongoing growth concerns, while Japanese stocks benefited from yen weakness. European markets opened with limited direction, reflecting uncertainty over ECB policy trajectory and US labor market health. The dollar's recovery suggests traders are squaring positions before the high-impact NFP release, with expectations centered around 185K jobs added. Currency volatility remains elevated, with EUR/USD trading in a tight 1.0820-1.0850 range. Technical analysis indicates the dollar index needs to break above 104.50 to confirm renewed bullish momentum. Risk-sensitive currencies like AUD and NZD remain vulnerable to any disappointment in US employment figures.