When is the US monthly jobs report (NFP) and how could it affect EUR/USD?

Haresh Menghani FXStreet

US monthly jobs report overview

Friday's US economic docket highlights the release of closely watched US monthly employment details, popularly known as NFP. The report is scheduled to be released at 12:30GMT and is expected to show that the US economy added 160K new jobs in June, recovering from the previous month's softer reading of 75K.

Meanwhile, the unemployment rate is expected to hold steady at a multi-decade low level of 3.6% during the reported month and hence, the key focus will be on wage growth figures, which have gained more traction in the recent past. Average hourly earnings are foreseen to rise by 0.3% on a monthly basis as compared to 0.2% recorded in the previous month, while the yearly rate is also anticipated to tick higher to 3.2% from 3.1% previous.

Deviation impact on EUR/USD

Readers can find FX Street's proprietary deviation impact map of the event below. As observed, the reaction to the headline NFP print, in case of a relative deviation of -0.39 or +0.50 is likely to be in the range of 33-40 pips during the first 15-minutes and could stretch to 80-pips in the subsequent 4-hours.

How could the data affect EUR/USD?

Yohay Elam, FXStreet's own Analyst offers important technical levels to trade the EUR/USD pair – “Substantial support awaits at 1.1265 where we see the confluence of the SMA 5-1d, the Pivot Point one-day Support 2, and the SMA 100-1d. Losing that line unleashes the downside with a cushion at 1.1218 which is the convergence of the PP 1m-S1 and the SMA 50-1d.”

“The Technical Confluences Indicator is showing that a dense cluster of resistance awaits at 1.1318 where we see the Bollinger Band 4h-Middle meeting the Fibonacci 38.2% one-month, the Simple Moving Average 100-4h, and the Pivot Point one-day Resistance 2. If the world's most popular currency pair breaks above this line, it faces only weak resistance at 1.1354 (SMA 50-4h and SMA 200-1d), the Bollinger Band 1d-Upper at 1.1377 but the most significant upside target is 1.1418 which is where the previous monthly high and the previous weekly high converge,” he added further.

Key Notes

• US Non-Farm Payrolls Preview: Three is not the charm

• US NFP Preview: 11 Major Banks expectations from June payrolls report

• Non-Farm Payrolls Preview: Three scenarios for the EUR/USD reaction as the Fed figures out its loosening strategy

About the US monthly jobs report

The nonfarm payrolls released by the US Department of Labor presents the number of new jobs created during the previous month, in all non-agricultural business. The monthly changes in payrolls can be extremely volatile, due to its high relation with economic policy decisions made by the Central Bank. The number is also subject to strong reviews in the upcoming months, and those reviews also tend to trigger volatility in the forex board. Generally speaking, a high reading is seen as positive (or bullish) for the USD, while a low reading is seen as negative (or bearish), although previous months reviews and the unemployment rate are as relevant as the headline figure, and therefore the reaction depends on how the market asses them all.

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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