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NFP On Deck
The US Dollar is firmly on watch today as traders brace for the latest US labour market data. Following weakness in the April NFP report, traders will be looking to see if this weakness continued through last month or if the labour market rebounded. A weaker-than-forecast APD reading earlier in the week has raised some expectation that we could be in for a fresh downside surprise.
Forecasts For Today
On the numbers front, the market is looking for the headline NFP to print 182k from 175k prior, the unemployment rate to hold steady at 3.9% and average hourly earnings to rise to 0.3% from 0.2% prior. If these forecasts are met, the reaction in USD will likely be muted, neither diluting or strengthening September rate cut chances.
Two-Way Risk
In terms of the most market moving outcome today, this will be seen if we get a surprise in either direction. If data is seen undershooting these forecasts, confirming fresh weakness in the labour market for a second consecutive month, this will no doubt see an uptick in September rate-cut expectations, dragging USD lower near-term. However, if we see a rebound in the data with above-forecast readings, this will likely dilute near-term easing expectations, creating room for a recovery rally in USD.
Technical Views
DXY
Following the breakdown below the bull channel support line, price has yet to follow-through beyond the 104.05 support level. With bearish momentum studies readings, however, focus is on a continued push lower near-term with 103.48 the next support to watch unless bulls can get back above 104.97 and back inside the bull channel.
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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.