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

US monthly jobs report overview

Friday's US economic docket highlights the release of the closely watched US monthly employment details, popularly known as NFP. The report is scheduled to be released at 13:30GMT and is expected to show that the US economy added 180K new jobs in November, up from the previous month's reading of 128K.

Meanwhile, the unemployment rate is expected to tick higher to 3.6% during the reported month and the key focus will remain on wage growth figures, which have gained more traction in the recent past. Average hourly earnings are foreseen to post a growth of 0.3% on a monthly basis, versus the previous month's rise of 0.2%. The yearly rate is anticipated to show an increase of 3.0%, matching October's reading.

As analysts at Danske Bank explained: “Employment in October was quite strong, both when looking at the upward revisions of the previous months and the fact that the strike at General Motors pulled the headline down by nearly 50,000 workers. Soft indicators are showing a weakening in employment growth, but the headline is likely to be strong, as the striking workers have returned to work. We estimate non-farm payrolls rose 200,000 in November, suggesting underlying growth of around 150,000.”

How could the data affect EUR/USD?

Yohay Elam, FXStreet's own Analyst offered his take on the EUR/USD pair: “The Relative Strength Index on the four-hour chart is just above 70 – indicating overbought conditions – indicating a slide. Moreover, upside momentum has waned, and the currency pair is capped by uptrend resistance. On the other hand, it trades above the 50, 100, and 200 Simple Moving Averages.”

Yohay further also provided important technical levels to trade the major: “Support awaits at 1.11, which held euro/dollar down last week. The next level to watch is 1.1065, a support line earlier this week, which converges with the 200 SMA. Next, we find 1.1050 – the confluence of the 50 and 100 SMAs, followed by 1.1030, which held the pair down last week. November's low of 1.0980 is next. Resistance is at 1.1115, Thursday's high. Next, we find 1.1130, a support line from early November, and 1.1180 – a critical double top.”

Key Notes

   •    US Non-Farm Payrolls November Preview: Labor market continues to defy concerns

   •    Non-farm Payrolls Preview: Economic health vs trade war, who will win the battle?

   •    EUR/USD Forecast: Running out of steam and ready to fall ahead of Non-Farm Payrolls

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.