Will NFP Be Positive for the US Dollar?

Will NFP Be Positive for the US Dollar?

2023-12-07 • Updated

As the US Non-Farm Payrolls (NFP) take center stage, this month's data gains special attention, particularly after the unemployment rate took a concerning turn in the previous month. The US ADP Employment Change reveals a significant decline, with the economy adding 298K new jobs in the last three months, marking a 68% drop from the robust 947K new jobs in the preceding quarter. While the official NFP data indicates the addition of 150K new jobs in November, following a strong October reading of 336K, the disparity between ADP and NFP figures raises questions about the reliability of the latter.

Market sentiment leans towards trusting the ADP data more, considering the potential for substantial revisions in the NFPs.

The recent uptick in the unemployment rate, reaching 3.9% from a multi-year low of 3.4% at the beginning of 2023, aligns with the anticipated weakening of the labor market, a trend acknowledged by both the Federal Reserve and investors.

EURUSD - H1 Timeframe


EURUSD has recently broken above the trendline resistance as a result of the pressure from its rejection from the daily demand zone. On this basis, and considering the fact that the RSI (Relative Strength Index) on the Daily timeframe is oversold at the moment, it appears to me that there would be a temporary bullish impulse on EURUSD in the meantime.

Analyst’s Expectations: 

Direction: Bullish

Target: 1.08340

Invalidation: 1.07540

GBPUSD - H1 Timeframe


GBPUSD on the hourly timeframe has broken and retested the resistance trendline, leading me to believe that a bullish impulse could be in motion. The fact that the demand zone on the daily timeframe was the origin of the bullish impulse can also be considered a confluence in support of the bullish sentiment.

Analyst’s Expectations: 

Direction: Bearish

Target: 1.26024

Invalidation: 1.25467

USDJPY - H4 Timeframe


USDJPY seems to be reacting off the demand zone on the daily timeframe, however, I have reason to believe that this movement could be price’s way of letting off some steam after the impulsive drop over the past week. In this regard, it would be best, however, to seek further confluences on the lower timeframes before taking an entry.

Analyst’s Expectations: 

Direction: Bullish

Target: 145.914

Invalidation: 143.300


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