US Nonfarm Employment Change measures the change in the number of newly employed people in the US, excluding workers in the farming industry. A reading which is higher than the market forecast is bullish for the dollar. Here are the details and 5 possible outcomes for EUR/USD.
Published on Friday at 12:30 GMT.
Update: Non-Farm Payrolls at 161K – small miss, strong wages at 0.4%. On to the next big event:
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Indicator Background
Job creation is one of the most important leading indicators of overall economic activity. The release of US Non-Farm Employment Change is highly anticipated by the markets, and an unexpected reading can have a substantial impact on the direction of EUR/USD.
In September, Nonfarm Employment Change rose slightly to 156 thousand, but this was well short of the estimate of 171 thousand. The markets are predicting a strong improvement in the October report, with an estimate of 174 thousand. Will the indicator meet expectations?
Sentiment and Levels
The euro has posted considerable gains this week, boosted by decent inflation and GDP data out of the Eurozone. This upward trend could continue, so overall sentiment is bullish on EUR/USD towards this release.
Technical levels, from top to bottom: 1.1335, 1.1230, 1.1190, 1.1125, 1.1070 and 1.10
5 Scenarios
- Within expectations: 171K to 177K. In such a scenario, the EUR/USD is likely to rise within range, with a small chance of breaking higher.
- Above expectations: 178K to 182K. An unexpected higher reading could push the pair below one support line.
- Well above expectations: Above 182K. Such an outcome could push the pair lower and two or more support lines could fall as a result.
- Below expectations: 166K to 170K. A weak reading could result in EUR/USD breaking above one resistance line.
- Well below expectations: Below 166K. A very soft reading could result in the pair breaking above two or more resistance lines.
And here is everything you need to know about the bigger event around the corner:
For more about the euro, see the EUR/USD.