Posted Jul 3, 11:19

Jobs Jump Fades

Jobs Jump Fades Chart
15 hours ago: 

Risk trades initially cheered an unexpectedly strong non-farm payrolls report but the enthusiasm didn't last (More on the dynamics of market reaction and yesterday's key 6 charts  below).  Strong US data and recovering China PMIs helped affirm the paragdigm of stabilizing growth = USD weakness, which was anticipated in yesterday's NFP preview here.  XAG, AUD, NZD are leading against the USD, while GBP and CHF lag. The US is on holiday, giving markets a chance to regroup. Monday's long DOW30 trade in the Premium Insights' hit its 26200 target yesterday for a 670-pt gain, while last week's Premium long in DAX at 12130 has yet to reach its final target of 12770, but Ashraf may close it before today's close.

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Strong US jobs & caveats

US June non-farm payrolls roundly beat expectations with 4.8m new jobs added compared to the 3.2m consensus. In addition, the prior two reports were revised modestly higher. Perhaps most impressive was the unemployment rate at 11.1% compared to 12.5% expected. The caveat that market participants had been watching surrounding that metric was in those absent from work for 'other reasons'. It had swelled recently and would have meant an additional 3 percentage point increase in May. The BLS highlighted that many of those probably belonged in the unemployed category were estimated at up to 3%. This month, they estimated that only 1 pp of them were likely miscategorized.

PREMIUM INSIGHTS Update: Jun 29, 20:50
Looking Through Jobs Data Confusion Jul 2, 2020 13:05: 

All eyes turn to today's release of the US June employment report (Friday is an early US close due to US Independence Day), which will raise more questions than answers due to the fast-changing dynamics of data collection, workers classification and revisions (more on why many see an upside surprise below). Global indices extend their ascent with the DAX breaking short-term trendline above 12480s and DOW30 attempting to regain its 200-DMA. Since the start of the Asian session, Kiwi and sterling are the top gainers, while loonie and silver are the only losers against USD. The final target in our Premium long XAUUSD from April 20 remains at 1790 as we have not yet seen the exact print from most platforms (but most of you must have locked in some gains on the way from 1690 entry)


Virus Drug Optimism Kicks off Quarter Jul 1, 2020 14:22: 

Gobal indices jumped ahead of the US open on positive findings about an experimental coronavirus vaccine from Pfizer and BioNtech, which produced a high level of antibodies. Tuesday's news of stronger US consumer confidence data and stable US virus cases were sufficient to boost risk trades to a strong finish for the quarter. ADP jobs data also came in stronger than expected. The ISM manufacturing survey is due up next. The chart below shows positive US economic data surprises are away ahead of the rest, raising the question about sustainability. Each of the last two Premium trades is up +250 pts and open.


The Strongest & Weakest

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Start of day is 17:00, Eastern Time/New York Time,