TheNews

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

Another 205K expansion in Non-Farm Payrolls (NFP) may heighten the appeal of the greenback and spur a near-term pullback in EUR/USD as it puts increased pressure on the Federal Open Market Committee (FOMC) to further normalize monetary.

What’s Expected:



Why Is This Event Important:

Market participants may pay increased attention to Average Hourly Earnings as the U.S. economy approaches ‘full-employment,’ and the ongoing weakness in private-sector wages may push the committee to further delay the normalization cycle as central bank officials highlight the downward tilt in inflation expectations.

Nevertheless, waning business confidence paired with the rise in planned job-cuts may drag on labor market dynamics, and the dollar may face further losses over the near-term should the NFP report dampen the outlook for growth and inflation.

How To Trade This Event Risk

Bullish USD Trade: NFP Expands 205K+ Accompanied by Sticky Wage Growth

• 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 Labor Report Fails to Meet Market Expectations

• 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.

Potential Price Targets For The Release
EURUSD Daily

• Despite the divergence paths between the Federal Reserve and the European Central Bank (ECB), EUR/USD stands at risk of a further advance and may revisiting the highs from 2015 as it breaks above the February high (1.1375).
• Interim Resistance: 1.1510 (50% retracement) to 1.1520 (61.8% expansion)
• Interim Support: Interim Support: 1.0380 (78.6% expansion) to 1.0410 (61.8% expansion)

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