News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Bullish
Oil - US Crude
Bearish
Wall Street
Mixed
Gold
Bearish
GBP/USD
Bearish
USD/JPY
Bullish
More View more
Real Time News
  • #Euro has rebounded off near-term downtrend support and the focus is on this near-term recovery. Get your $EURUSD technical analysis from @MBForex here:https://t.co/NmlEuNyfo6 https://t.co/Txjym8OG71
  • Heads Up:🇳🇿 Building Permits MoM (AUG) due at 21:45 GMT (15min) Previous: -4.5% https://www.dailyfx.com/economic-calendar#2020-09-29
  • Forex Update: As of 20:00, these are your best and worst performers based on the London trading schedule: 🇦🇺AUD: 0.86% 🇪🇺EUR: 0.67% 🇨🇭CHF: 0.59% 🇬🇧GBP: 0.18% 🇨🇦CAD: -0.14% 🇯🇵JPY: -0.17% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/wQGKBz35p4
  • That is very disturbing news. Disney has announced it will layoff 28,000 employees owing to its struggle at theme parks. That follow up stimulus plan is even more necessary in the US
  • Disney plans to lay off 28,000 park employees. $DIS shares are 1.5% lower following the announcement
  • Commodities Update: As of 20:00, these are your best and worst performers based on the London trading schedule: Silver: 2.37% Gold: 0.91% Oil - US Crude: -0.03% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/OcKlpGbJvJ
  • #Gold Price Outlook: $XAUUSD Pops, Resistance at Prior Support - https://t.co/ZMukXQfl3z https://t.co/ApjvP4xb1F
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 96.19%, while traders in EUR/USD are at opposite extremes with 61.70%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/2yhFXRJBjw
  • Micron Q4 2020 Earnings: Revenue: $6.06B vs $5.90B exp EPS: $1.08 vs $0.99 exp Guides Q1 revenue $5B to $5.4B vs $5.33B exp $MU shares just 1% higher in after-hours trading
  • Regeneron reports positive data for its Covid-19 antibody drug, saying it helped reduce viral levels and improved symptoms faster, according to CNBC
Preview for September US NFP and Price Action Outlook for US Dollar

Preview for September US NFP and Price Action Outlook for US Dollar

2018-10-05 12:00:00
Christopher Vecchio, CFA, Senior Strategist
Share:

Talking Points:

- The September US Nonfarm Payrolls report is due to show jobs growth around +200K, following the ADP Employment and ISM Non-Manufacturing/Services reports released earlier this week.

- The DXY Index technical structure has become more bullish in recent days; a retest of the August high is not out of the question.

- Retail traders remain net-long EUR/USD and GBP/USD, fading the US Dollar rally.

Looking for longer-term forecasts on the US Dollar? Check out the DailyFX Trading Guides.

The US Dollar's recent rally (via the DXY Index) is taking a breather today, ready to snap six straight days of gains ahead of the release of the September US Nonfarm Payrolls report tomorrow. But with US Treasury yields across the curve pushing to multi-year highs, traders have been quick to buy the US Dollar dip. It seems that the September NFP release will do little to break current sentiment around the greenback.

Join me for live coverage of the September US NFP report at 8:15 EDT/12:15 GMT

Current expectations for the US jobs data remain modest, even after better than expected ADP Employment (+230K versus +184K expected) and ISM Non-Manufacturing/Services (61.6 versus 58 expected, an all-time high) figures earlier in the week. Bloomberg News' consensus forecast calls for the unemployment rate expected to drop from 3.9% to 3.8%, and the headline jobs figure to come in at +185K. Wage growth is due in around +2.8% from +2.9% y/y.

Using a 10-year rolling model, the ADP report and the ISM Services report can account for 88% of the changes in the NFP figure (R^2 = 0.88). In sum, these proximal trackers of the US labor market correspond with pace of jobs growth between +190K to +220K. The only wrinkle? There may be an impact due to Hurricane Florence, which would weigh on the headline figure.

Overall, as long as the headline for the September jobs report comes in above +75K to +125K, the jobs data will be good enough to keep the economy on track to maintain the unemployment rate (U3) at 3.9% through the end of 2018. The Atlanta Fed Jobs Calculator shows that the US economy needs to add +107K jobs for the next 12-months to maintain the unemployment rate at 3.9%.

From this point of view, the US Dollar's bullish posture should remain intact heading into next week. Yet given the fact that the labor market isn't necessarily being watched closely as the decision trigger for the next rate hike, the data may have a limited impact. Recent US Dollar gains have been divorced from more hawkish rate hike pricing, as noted earlier this week.

DXY Index Price Chart: Daily Timeframe (January to September 2018) (Chart 1)

Preview for September US NFP and Price Action Outlook for US Dollar

The DXY Index's technical structure has turned bullish this week, despite weakness seen today. The DXY Index was able to retake 95.53 yesterday, prior key resistance in July and August. Price is still above its daily 8-, 13-, and 21-EMA envelope, and the moving averages remain in sequential order. Both daily MACD and Slow Stochastics are continuing to trend higher, with the former back above its signal line and the latter back to neutral. A hold above 95.53 through the end of this week would signal the potential for greater gains as the calendar moves into the middle of October.

Read more: DXY Index Sustains Gains as EUR/USD Bounce Fades

FX TRADING RESOURCES

Whether you are a new or experienced trader, DailyFX has multiple resources available to help you: an indicator for monitoring trader sentiment; quarterly trading forecasts; analytical and educational webinars held daily; trading guides to help you improve trading performance, and even one for those who are new to FX trading.

--- Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES