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 13:30 GMT.
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 October, Nonfarm Employment Change rose to 161 thousand, but this was well short of the estimate of 174 thousand. The markets are expecting the upward trend to continue, with an estimate of 165 thousand.
Sentiment and Levels
The euro has been steady, as this week’s inflation and manufacturing numbers have been solid. At the same time, US GDP and consumer confidence beat their estimates. So, overall sentiment is neutral on EUR/USD towards this release.
Technical levels, from top to bottom: 1.0850, 1.0780, 1.0710, 1.0520 and 1.0460
5 Scenarios
- Within expectations: 162K to 168K. In such a scenario, the EUR/USD is likely to rise within range, with a small chance of breaking higher.
- Above expectations: 169K to 173K. An unexpected higher reading could push the pair below one support line.
- Well above expectations: Above 173K. Such an outcome could push the pair lower and two or more support lines could fall as a result.
- Below expectations: 157K to 161K. A weak reading could result in EUR/USD breaking above one resistance line.
- Well below expectations: Below 157K. A very soft reading could result in the pair breaking above two or more resistance lines.
For more about the euro, see the EUR/USD forecast.
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