NFP Up Next
The big data today is of course the US employment reports. The headline NFP figure is forecast to print 645k, up from the prior month’s 266k while the unemployment rate is forecast to fall back to 5.9% from the prior month’s 6.1%. On the back of a solid ADP release yesterday, upside risks are clear here. If the data comes in strong today, USD is likely to catch fire, extending the profit taking on USD shorts which started in response to yesterday’s data. Keep an eye also on the wage growth figure. The prior month’s surprise 0.7% reading is expected to have cooled to 0.2% last month. If this reading sees upside surprise, this will stoke inflation expectations once again.
Where to Trade The NFP?
10yr treasury yields have been rangebound following the breakout above the bull flag formation. Price is currently hovering on support at the 1.584 level. If today’s data is strong, we are likely to see a sharp move higher targeting a break of 1.685 and 1.77 thereafter. To the downside, should the data miss, a break of 1.584 will see bears targeting 1.424 next.
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Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.
Past performance is not indicative of future results.
High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 75% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.