We at FOREXYARD, encourage our customers to get involved in the most intense market events. As such, we think you should know that US Nonfarm Employment Change figures are expected on Friday, September 5th, 12:30 (GMT), and you need to be prepared. Market events like this one tend to create either big changes to current trends or push current trends even further. Generally, the majors are the ones most affected by market events in general but Crude Oil, Gold prices, and even the price of Silver can change dramatically in the seconds after such a publication. For more information about the US Nonfarm Employment Change, please read below.

What Is The Nonfarm Employment Change?

The U.S Nonfarm Employment Change, also known as “Non-Farm Payrolls” (NFP) and the “Employment Report”, is a monthly economic indicator used to measure the change in the number of employed people, excluding the farming industry.

Each month the Current Employment Statistics program surveys about 150,000 businesses, representing approximately 390,000 worksites, in order to provide detailed industry data on employment, work-hours, and earnings of workers on nonfarm payrolls for all 50 US states. The survey is then published on the first Friday of each month.

The NFP is an important leading indicator that also affects consumer spending, which accounts for a majority of overall economic activity. Traders value the indicator with the highest importance as its early monthly release can set the tone for the rest of the month’s market movement. Investors should also note Thursday’s 12:15 GMT release of Automatic Data Processing Inc. (ADP) estimate of Non-Farm Employment Change. In the past ADP has provided an accurate assessment of what was to come from the actual NFP release a day later. However, with the volatility of world economies in recent months, the ADP report has not been able to correctly estimate the Non-Farm Payroll outcome, only strengthening the real power behind Friday’s news release.

If the Survey Comes Inline With Market Forecasts

Expectations for this month reveal that the Non-Farm Employment Change figures will drop by 73K from July. Such a result, should it take place, will be the biggest drop in employment numbers that the U.S economy has experienced since April of this year. Previous surveys have shown that publications that reflect a significant contraction in the job sector had a radical impact on the USD, and concluded in a sudden downtrend. Considering that the survey has delivered negative figures for several consecutive months now, another sharp drop could signal a temporary halt in the Dollar’s bullishness, and the USD could be facing an unfortunate weekend, causing the EUR/USD pair to rise back toward levels around 1.4700

If the Survey Will Surprise With Bullishness

If the actual figure is higher than forecasted, traders are likely to see the USD appreciate against other majors. Currently, investors are setting their positions on the USD based on the assumption that by the end of the week, the USD should face a sharp bearish movement. However, in case that the survey will deliver better figures than expected, such as 40K drop instead of the forecasted 73K drop, investors will be compelled to reevaluate their strategies, and go long on the USD. In this turn of events, the Dollar might receive an extra boost that will broaden its bullish voyage, and the EUR/USD could drop toward levels of 1.4350, breaking what would be a 9 month record.

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We at FOREXYARD, encourage our customers to get involved in the most intense market events. As such, we think you should know that ISM Manufacturing PMI figures are expected Tomorrow, September 2nd, 14:00 (GMT), and you need to be prepared. Market events like this one tend to create either big changes to current trends or push current trends even further. Generally, the majors are the ones most affected by market events in general but Crude Oil, Gold prices, and even the price of Silver can change dramatically in the seconds after such a publication. For more information about the ISM Manufacturing PMI, please read below.

What is the ISM Manufacturing PMI?

The Institute for Supply Management (ISM) releases a monthly report of the Manufacturing Purchasing Managers’ Index (PMI). The Index is used to measure the level of diffusion based on surveyed purchasing managers in the manufacturing industry. The Index’s figures are very easy to detect; while a 50.0 mark stands for a static industry, a reading above it indicates that the industry is expanding. A reading below 50.0 naturally indicates contraction.

The survey is put together by surveying 400 US purchasing managers who are asked to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries and inventories.

Traders should pay special attention to the ISM Manufacturing PMI as it is a leading indicator of economic health. Businesses react quickly to market conditions, and their purchasing managers hold perhaps the most current and relevant insights into the company’s view of the economy.

If the Survey Comes Inline with Market Forecasts

Expectations for this month’s figure are suggesting that the US manufacturing sector suffered from a mild contraction last month, as analysts expect a 49.9 mark for August. Such a result should be treated as a warning sign for those who claim that the U.S economy has managed to pull itself out of recession, as a non-expanding industry usually takes place at times of decreasing economic activity. Furthermore, if the index fails to reach expectations and delivers even lower than expected results, investors around the globe will see it as an excellent opportunity to initiate a mild correction for the USD, as it will prove that there are still creaking sounds from the U.S economy, and the EUR/USD might rise all the way back to 1.4800.

If the Survey Will Surprise With Bullishness

When the actual figure is higher than forecasted, traders are likely to see the USD appreciating against its currency pairs and crosses. A series of positive data has accompanied the U.S economy lately, which has resulted in a rising trend for the Dollar. In the event that the ISM data will produce a result of 50.5 or above, it can be considered a positive economic gauge that should provide investors with extra confidence that the U.S economy has in fact entered a phase of growth that is developing at a steady and healthy rate. In this scenario, the USD is largely expected to experience another bullish session that could result in EUR/USD levels close to1.4500.

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