Tomorrow's NFP job numbers, Friday 8:30am EST, will be the most anticipated event going into tonight's Asian and tomorrow morning European sessions. It should be an exceptionally volatile trading day, as it normally is during the release of Non-Farm payrolls.
Based on the results of this week's economic releases, all traders, investors, and economists are bracing for the worst. There were major disapointments in the S&P/Case-Shiller index, ADP, and ISM Manufacturing PMI
S&P/Case-Shiller index: home prices in 20 US cities declined to eight year lows, according to Case-Shiller
ADP: 38k actual vs. 177k forecast vs. 177k previous
ISM Manufacturing PMI: 53.5 vs. 58.1 vs. 60.4
The weak ADP number prompted a massive wave of downward revisions to NFP forecasts by Economists and Banks across Wall Street.
As always it will be important to dissect the numbers, especially with the change in Private Sector Payroll, 268K previous vs. 180K forecast. As a result of the revisions made by the major banks on Wall Street this week, look for private sector payrolls to come in lower as well, close to 100K if not below that.
Click on article to see a breakdown of revisions: Major Banks lower NFP forecasts after ADP Disappoints
The next 2 charts are courtesy of BLS, The Bureau of Labor Statistics, showing the montly difference in job creation:
With positive risk appetite to continue overnight, look to sell EUR/USD at 1.4550-1.46, AUD/USD 1.08. We may see the spike up in both EUR/USD and AUD/USD within the first 5 minutes of the NFP release, as a lack of liquidity. It would be smart to wait for volatility to settle down, and then fade the move.