Hello Everyone,
Today Morning, NFP came out to be -701K instead of expected -100K as well as unemployment rate jumped from 3.8 to 4.3, both points are negative for USD but the immediate move was in favour of USD (EUR/USD pair), I was unable to understand this move. Even if we take an account that USD has been stronger agains EUR this week still the numbers are heavily negative and should push the air up north. We can say that the most important fundamental these days is the carona virus and at the time of this week’s jobless claims the move was fairly muted but I was expecting some move today. Could someone shed some light on this and let me know what have I missed (may be crude oil up move ?).
Cheers,
DayDreamer
Hey DayDreamer3d, NFP is a non-directional data, meaning that the outcome of the news (positive or negative) doesn’t necessarily reflect what happens on the market (EUR/USD going up or down).
If you study past movements on EUR/USD when NFP came out, you can see that many times the data was positive and EUR/USD went up, just like many times the data was negative and EUR/USD went down.
It’s good to create some volatlity, it’s not very good to give direction to the market.
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thanks for your response.
Cheers,
Day Dreamer
The NFP result was actually within the expected range according to the MetaStock Xenith news service I subscribe to. And also the Federal Reserve has been pumping huge amounts of stimulus into the economy. Those factors may have explained the weak move in favour of the USD since the whole week the USD seemed to be gradually strengthening.