NFP due out at 8:30 AM
The Expectation is for a gain of 10K jobs. This would be a bounce back from the -84 K last month. Last month was hurt by the weather with estimates that it could have had a -100K impact. Since that time, the Initial Claims have actually risen from around 430K at the end/beginning of Dec/Jan to 470ish in recent weeks. However, we did have a higher than expected GDP which should lead to higher jobs at some point. The Unemployment rate is expected to remain at 10.0%. Manufacturing jobs are expected to shed another -20K. Also released will be the benchmart revisions for last year which are exected to show that another -800K jobs were lost in 2009 capping the worst job loss year on record.
As is always the case, risk increases during an Employment report so if you have no position it is not suggested to take a new one until after the event. At that time the market can be assessed and a directional bias can hopefully be estabished. I would expect that a stronger number benefits risk currency pairs and may weaken the dollar at least initially, and visa versa. However, nothing can be guaranteed as far as a reaction. As a result following the key technical levels are always recommened.
Below are the key levels for the major currency pairs.
EURUSD:
USDJPY
GBPUSD
USDCHF
(Aug 30, 2010)
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