Another Historic NFP Report Comes Out Today


Much has been said about the current state of the US labor market. Economists expect the non-farm payrolls (NFP) number to decline to -22 million for April, down from -701k scored in March. There has never been such a substantial drop in jobs, and these times are truly unprecedented. The unemployment rate is forecast to rise to 14% from 4.4% previously, but as we speculated earlier, the real number will most likely be far worse. We expect the unemployment rate to reach 23%. 


3 Instruments To Watch Out for After Today’s NFP

Much of these disastrous numbers are already priced in, that's for sure. But let's take a look at some favorite instruments and how they could react after today's results, which are due at 4:30 PM GST. 

How Could the NFP Affect The SP500 Index?

Stocks tend to rally every time there are either jobless claims or ADP releases. The same thing can happen today, with indices already 1 percent higher during the London session. 
The significant rally seems to be at the 200 EMA, which is now at around 2,950 USD, and if broken to the upside, April highs of 2,975 USD could be reached quickly. The next target will be at the psychological level of 3,000 USD. 
Alternatively, if a decline occurs today, the first support is seen near 2,900 USD and afterward at around 2,860 USD.

How Could the NFP Affect Gold? 

The bullion was bid on Thursday as traders started to price in negative rates in the US, which is a significant event. The 1,680 USD support zone was held again, and the short-term outlook now seems bullish. The critical resistance appears to be at previous highs of 1,750 USD. Gold might accelerate higher today as the US economy has plunged into depression.

How Could the NFP Affect the USDJPY

As we said earlier, at this rate rate traders are now expecting negative rates in the US as early as October, which should keep the US dollar under severe pressure. Thus, we don't expect the USDJPY pair to rally materially from the current levels. Support is seen at 106.00, and it could be broken today, with the next target at 105.00.
Alternatively, if today's NFP number is taken positively, we could see a relief rally toward the major resistance at 107. Still, sellers will likely return at these prices as the fundamental situation appears very bearish for the greenback.
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