When is the US monthly jobs report (NFP) and how could it affect EURUSD?

US monthly jobs report overview

Friday's US economic docket highlights the release of the closely-watched US monthly jobs data for October. The popularly known NFP report is scheduled for release at 12:30 GMT and is expected to show that the economy added 200K jobs during the reported month, down from the 263K in September. The unemployment rate is anticipated to have edged higher from 3.5% to 3.6% in October. Apart from this, investors will take cues from Average Hourly Earnings, which could offer fresh insight into the possibility of a further rise in inflationary pressures.

Analysts at Societe Generale sound more optimistic and offer a brief preview of the important US macro data: “For October, we expect NFP to rise by 300K, faster than the 263K reported in September. Payrolls grew an average of 562K per month in 2021 and in the first half of 2022 they grew at a 444K pace. The unemployment rate is expected to hold steady at 3.5%, but we view a further decline to 3.4% as highly likely very soon. With employment gains above a 150-175K range per month, there is pressure for the unemployment rate to drop. We estimate the 150-175K pace as representing growth in the working-age population.”

How could the data affect EURUSD?

Ahead of the key release, the US Dollar retreats from a nearly two-week high touched the previous day and assist the EURUSD pair to regain some positive traction on Friday. Weaker US employment details might prolong the USD profit-taking slide and provide an additional lift to the major. That said, a more hawkish stance adopted by the Federal Reserve should limit deeper losses for the greenback.

Hence, any positive surprise should be enough to trigger a fresh leg up for the USD and attract fresh sellers around the EURUSD pair. This, in turn, suggests that any subsequent move up might still be seen as a selling opportunity and runs the risk of fizzling out rather quickly.

Eren Sengezer, Editor at FXStreet, offers a brief technical overview and outlines important technical levels to trade the major: “EURUSD is facing interim resistance at 0.9800 (static level, psychological level) ahead of 0.9820 (200-period SMA on the four-hour chart, descending trend line). A four-hour close above the latter could be seen as a bullish sign and attract buyers. In case the Relative Strength Index (RSI) indicator rises above 50 on such development, the pair could extend its recovery toward 0.9860 (100-period SMA) and 0.9900 (psychological level).”

“On the downside, near-term support seems to have formed at 0.9740 (static level) before 0.9700 (psychological level, static level) and 0.9630 (Oct. 13 low),” Eren adds further.

Key Notes

  •  NFP Preview: Forecasts from 10 major banks, further significant job growth

  •  EURUSD Forecast: Euro needs to overcome 0.9820 to extend rebound

  •  EURUSD Price Analysis: Oversold oscillators in an uptrend structure triggers a bargain buy

About the US monthly jobs report

The nonfarm payrolls released by the US Department of Labor presents the number of new jobs created during the previous month, in all non-agricultural business. The monthly changes in payrolls can be extremely volatile, due to its high relation with economic policy decisions made by the Central Bank. The number is also subject to strong reviews in the upcoming months, and those reviews also tend to trigger volatility in the forex board. Generally speaking, a high reading is seen as positive (or bullish) for the USD, while a low reading is seen as negative (or bearish), although previous months reviews and the unemployment rate are as relevant as the headline figure.