Markets are facing a “defining moment” on Friday, August 7th, as crucial July jobs data rolls out – data the Federal Reserve itself is waiting for in the wake of a 9-3 split and the market calling ~64% odds of a September Fed rate hike. The Nonfarm Payrolls (NFP) report could be the swing event for the entire back half of August. Here's everything you need to know -- what you should expect, where key technical levels lie, and how major assets could trade depending on the result. --- What the Data Says Due out Friday, August 7th at 12:30 GMT, the Nonfarm Payrolls report gauges the monthly change in US employment from the economy’s payrolls outside of agriculture and a couple of other areas.
Typically, it’s surprise relative to the Street’s projection, not the headline, that tends to move the markets.
NFP data prior vs. Estimate Forecast10.1% Unemployment Rate27,000-810,00074,000Prediction markets are yelling a somewhat different narrative – Traders put only a 47% chance on Payrolls exceeding 80k, with the real action expected between the 70k-80k range.--- Three Possible NFP Outcomes 1. Goldilocks (70,000 - 100,000 | 4.2% - 4.3% Unemp.) Most bullish outcome for risk-assets.
Would suggest economy is slowly cooling – nothing to warrant Fed hike pressure.
USD to remain soft Gold to spike to 4,118+ EUR/USD to breach 1.1560 resistance 2. Hot (100,000+ | Wages heat up) Continued strong labor market suggests Fed still pushing towards hikes. USD to fly towards 101.80-102.00 Gold to smash toward 4,000 Fed hikes likelihood >70% 3.
Cold (Sub-60,000 | Weak Wages) Could come in at nearly half or less of expected – shocker for the markets given the consensus 70K-90K range. USD could plunge towards 98.60-98.00 Gold to race above 4,118 towards 4,200. Recession fears would likely trump hopes for accommodative Fed. --- The Chart Setup For Key Markets Dollar Index (DXY) recently sliced below major support after a ~2% run lower on the back of Fed comments.
The DXY’s 38.2% Fibonacci resistance (around 99.50) will determine whether support at 98.85 becomes the next target for a sharp sell-off.
Resistance lies at 100.20-100.50. Gold PricesGold is stuck between a long-term range of roughly $4,020-4,118. A move below this band would signal a deeper sell-off, but a breakout to new highs is expected if the U.S. Dollar’s sell-off accelerates; traders would begin looking towards $4,200 and beyond.
GBPUSD forecast is the range around 1.32-1.36 for the coming week.
Support: 1.3270-1.3300 | Resistance: 1.3440-1.3480. EURUSD will keep pressing below 1.1560-1.1600, so we must wait until NFP data and see the Dollar rally or resume decline. Support can be observed at 1.1460-1.1420.
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