Free Trade Ideas

Welcome to NFP Trade! It’s been a wild day on Wall Street. Stocks have spun a U-turn from early session highs, the USD is plunging, and precious metals are on the bull. Why all the action? Three words — Non-Farm Payrolls.
During U.S. premarket hours, Non-Farm Payrolls (NFP) hit the wires in a big way. The number came in at 22,000, far below expectations of 75,000. Unemployment kicked higher to 4.3%, above the 4.2% market consensus. Without question, this is one of the weaker jobs reports in recent memory.
One would think that the headline jobs number is the big concern from today’s report. Not quite. Revisions to July and June’s NFP figures totalled a net loss of 21,000 from what was previously reported. June was the big loser, moving from 14,000 to -13,000. This is the first negative NFP print since December 2020.
The EUR/USD has broken to the topside and is up more than 0.80% for the day as of this writing. Remember the EUR/USD trendline analysis we have been talking about on live stream all week? That short trade is now dead; NFP has completely shaken things up, sending rates north of the 1.1750 level established during Jerome Powell’s Jackson Hole speech. Today was a great example of how a surprise economic number can shake up market sentiment. There is now talk of a series of aggressive rate cuts from the US Federal Reserve. Add that to the ongoing shakeup of the voting members of the FOMC itself, and the markets are pricing a much weaker dollar for the near future.
What a week! We’ll see you back here for Monday’s live stream at 1:00 PM EST. Trade well, and we’ll talk soon!