The Trader’s “Second Paycheck,” or the Release of Non-Farm Payrolls Data

Fundamentals

The UK services PMI was published yesterday at 8:30 am GMT. The number, at 55.8, was better than the expected 54.6. The British currency surged.
The number of initial US jobless claims, published at 12:30 GMT, fell to 238,000.
Today is a pivotal day for macroeconomic indicators or, as the joke goes, the trader’s “second paycheck” – the day on which Non-Farm Payrolls data are published. The news typically comes out at 12:30 pm GMT. At 6:00 pm GMT, after all the macroeconomic data have been released, we’ll be able to keep an eye out for Janet Yellen’s remarks. At bit earlier, at 5:30 pm GMT, FOMC members Evans, Bullard and Rosengren, presidents of the country’s reserve banks, will be speaking to the world.
You’ll recall that the Fed kept its discount rate at 1% p.a. The announcement says that the committee will carefully watch how the situation on both the US labor market and consumer market unfolds. It is entirely likely that Yellen will prefer to tighten monetary policy at the next meeting on June 14, 2017.
In addition to the Non-Farm Payrolls, traders will naturally be watching the publication of the exchange rate based on the monetary and credit policy of Australia’s Reserve Bank that comes out at 1:30 am GMT.

Stocks

Among US corporate news, Warren Buffet's Berkshire Hathaway will be reporting. Rating agency Moody’s will also release its report on Friday.
The situation on the Dow Jones looks like this: on the daily charts we can see 2 gaps from April 24 and 25, which are still not closed The MACDF has started to decline, warning of a possible downward reversal of the index. In addition, a signal of a possible reversal could be the Williams %R in overbought territory and its reversal to cross the upper channel boundary. Proof for the bears will be its intersection with the 9-day EMA. If the index does reverse, its support will most likely be 2377.
The US S&P 500, like the DJIA, is still trading sideways.

Currency Market

Unfortunately, our prediction about the AUD/JPY, that the pair was in the 4th wave of a trend impulse, turned out to be wrong. As we noted yesterday, therefore, the pair is near the target of 83.30 yen. The aussie is now testing the 9-day moving average. If there is a breakthrough down, we’ll see a continued decline. The target might be the closing of the April 24 gap. If the breakthrough is not confirmed, the bulls will get a second chance, and we’ll try to determine which wave the price is in according to wave theory. For now, we can’t rule out the formation of a 5-3-5 correction zigzag.
The bears have “put on their shorts” for the AUD/CHF pair. On the daily charts, we're now seeing the price chart moving outside the lower Bollinger Band. The ADX continues to rise, displaying sellers’ strength. No signals that indicate a reversal are on the horizon for now. It’s possible that, if there is a technical bounce, we’ll see the aussie return to the middle Bollinger bank, i.e., to 0.7500.

Nikolay Dudchenko, Olymp Trade analyst.

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