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
Bearish
Oil - US Crude
Mixed
Wall Street
Mixed
Gold
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Bearish
USD/JPY
Bullish
More View more
Real Time News
  • The Australian Dollar may extend its slide lower despite the planned easing of Covid-19 restrictions, as the market continues to price in an RBA rate cut on October 6. Get your #currencies update from @DanielGMoss here: https://t.co/HJpngnerzY https://t.co/g6X8ABQDwY
  • The Indian Rupee may be at risk to the US Dollar as USD/INR attempts to refocus to the upside. This is as the Nifty 50, India’s benchmark stock index, could fall further. Get your USD/INR market update here:https://t.co/ed4QR7QQOn https://t.co/gDWYNtm2UY
  • Technical indicators are chart analysis tools that can help traders better understand and act on price movement. Learn more about the importance of technical analysis here: https://t.co/NpC1D8y4Aa https://t.co/Q7TcbrYXjl
  • #Gold prices have plunged nearly 11% off the record highs with a breakout risking further losses. Here are technical trade levels that matter on the XAU/USD weekly chart. Get your #metals update from @MBForex here: https://t.co/7p3jPx6nQd https://t.co/yxymjCHti6
  • Traders tend to overcomplicate things when they’re starting out in the forex market. This fact is unfortunate but undeniably true.Simplify your trading strategy with these four indicators here:https://t.co/A4dqGMPylo https://t.co/yZzArpGs2h
  • GBP turbulence persists as investors eye the next round of EU-UK Brexit negotiations. Cautious optimism signals a deal is near. Get your #currencies update from @JMcQueenFX here: https://t.co/WjU4oYpmf7 https://t.co/VcNnCjm0B2
  • An economic calendar is a resource that allows traders to learn about important economic information scheduled to be released. Stay up to date on the most important global economic data here: https://t.co/JdvW6HNuqV https://t.co/AiLoS7DrEQ
  • Many people are attracted to forex trading due to the amount of leverage that brokers provide. Leverage allows traders to gain more exposure in financial markets than what they are required to pay for. Learn about FX leverage here: https://t.co/3Wked6GBOp https://t.co/HicBmGrokK
  • There is a great debate about which type of analysis is better for a trader. Is it better to be a fundamental trader or a technical trader? Find out here:https://t.co/7kPzAoNoLG https://t.co/5lbyBJeeA7
  • Entry orders are a valuable tool in forex trading. Traders can strategize to come up with a great trading plan, but if they can’t execute that plan effectively, all their hard work might as well be thrown out. Learn how to place entry orders here: https://t.co/lAFyv1gM0P https://t.co/ubLimoYAcr
Lackluster U.S. NFP Report to Fuel Post-ECB EUR/USD Rally

Lackluster U.S. NFP Report to Fuel Post-ECB EUR/USD Rally

2015-12-04 08:00:00
David Song, Shuyang Ren,
Share:

- U.S. Non-Farm Payrolls (NFP) to Expand 200+K for Second Month.

- Average Hourly Earnings to Slow to Annualized 2.3% from 2.5% in October.

For more updates, sign up for David's e-mail distribution list.

Trading the News: U.S. Non-Farm Payrolls

Another 200K expansion in U.S. Non-Farm Payrolls (NFP) may spur a near-term pullback in EUR/USD as it fuels bets for a December Fed rate-hike but, a marked slowdown in wage growth may dampen the appeal of the greenback as the central bank struggles to achieve the 2% target for inflation.

What’s Expected:

EUR/USD U.S. NFP

Click Here for the DailyFX Calendar

Why Is This Event Important:

Even though Federal Open Market Committee (FOMC) keeps the door open to remove the zero-interest rate policy (ZIRP) at the December 16 interest rate decision, the majority may opt to carry the current stance into 2016 in an effort to further mitigate the downside risks surrounding the growth and inflation outlook.

Expectations: Bullish Argument/Scenario

Release

Expected

Actual

Challenger Job Cuts (NOV)

--

-13.9%

ADP Employment (NOV)

190K

217K

Gross Domestic Product (Annualized) (QoQ) (3Q P)

2.1%

2.1%

The ongoing decline in planned job-cuts accompanied by the pickup in private-sector activity may encourage U.S. firms to boost their work force, and a marked expansion in employment may heighten demand for the greenback as it boosts interest rate expectations.

Risk: Bearish Argument/Scenario

Release

Expected

Actual

ISM Non-Manufacturing (NOV)

58.0

55.9

IS Manufacturing (NOV)

50.5

48.6

Advance Retail Sales (MoM) (OCT)

0.3%

0.1%

However, the slowdown in business outputs paired with the slack in household consumption may drag on hiring, and a dismal NFP print may prompt the Fed to further delay its normalization cycle in an effort to encourage a stronger recovery.

How To Trade This Event Risk(Video)

Bullish USD Trade: NFP Increase 200K or Greater in November

  • Need red, five-minute candle following the NFP print to consider a short trade on EUR/USD.
  • If market reaction favors a bullish dollar trade, sell EUR/USD with two separate position.
  • Set stop at the near-by swing high/reasonable distance from entry; look for at least 1:1 risk-to-reward.
  • Move stop to entry on remaining position once initial target is hit; set reasonable limit.

Bearish USD Trade: U.S Employment Report Falls Short of Market Forecast

  • Need green, five-minute candle to favor a long EUR/USD trade.
  • Implement same setup as the bullish dollar trade, just in the opposite direction.

Join DailyFX on Demand for LIVE Coverage of the U.S. Non-Farm Payrolls Report!

Potential Price Targets For The Release

EURUSD Daily

EUR/USD Daily Chart

Chart - Created Using FXCM Marketscope 2.0

  • EUR/USD appears to have marked a failed run at the March (1.0461) following the European Central Bank (ECB) interest rate decision as it breaks out of the downward trending channel carried over from the previous month, and the pair stands at risk for a larger correction as the Relative Strength Index (RSI) also appears to be threatening the bearish formation from August.
  • DailyFX Speculative Sentiment Index (SSI)shows the retail crowd has flipped net-short EUR/USD following the ECB meeting, with the ratio sliding to -1.58 as 39% of traders are now long.
  • Interim Resistance: 1.1052 (November high) to 1.1090 (50% retracement)
  • Interim Support: Interim Support: 1.0380 (78.6% expansion) to 1.0410 (61.8% expansion)

Impact that the U.S. Non-Farm Payrolls report has had on EUR/USD during the previous month

Period

Data Released

Estimate

Actual

Pips Change

(1 Hour post event )

Pips Change

(End of Day post event)

OCT 2015

11/06/2015 13:30 GMT

185K

271K

-113

-102

October 2015 U.S. Non-Farm Payrolls

EUR/USD Chart

U.S. Non-Farm Payrolls (NFP) largely exceeded market expectations as the economy added 271K jobs in November following a revised 137K the month prior. At the same time, the unemployment rate slipped to an annualized 5.0% from 5.1%, while the participation rate unexpectedly climbed to 66.0 from 65.9 in September. The report also pointed to stronger wage growth as Average Hourly Earnings rose at an annualized rate of 2.5% from 2.3% during the same period. The strong employment report may keep the Federal Reserve on course to normalize monetary policy in 2015 as central bank see the economy appears to be approaching ‘full-employment.’ The greenback strengthened following the release, with EUR/USD breaking below the 1.0800 handle to close the day at 1.0736.

*As we approach the holidays and thus illiquid markets, it's worth reviewing principles that help protect your capital. We call these principles the "Traits of Successful Traders."

Three Factors Warn of Perfect Storm in FX Markets - Caution Advised

Read More:

Dual Jobs Report to Threaten USD/CAD Consolidation Range

EUR/USD Retail FX Flips Net-Short on Mild ECB Easing Package

USD/JPY Testing Uptrend Resistance- Key NFP Levels

GBP Searches for Support- EUR/USD Outlook Mired by ECB Bets

COT - Gold Ownership Profile Similar to Prior Price Lows

--- Written by David Song, Currency Analyst and Shuyang Ren

To contact David, e-mail dsong@dailyfx.com. Follow me on Twitter at @DavidJSong.

To be added to David's e-mail distribution list, please follow this link.

Trade Alongsidethe DailyFX Team on DailyFX on Demand

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

DISCLOSURES