US Jobs Market in Spotlight This Week

The pessimistic mood in the market continued over the previous week, sending equities further down. The NASDAQ saw its worst-ever first half year score, plummeting over 30%, while the SP500 was down 21%, posting its worst first half to a year since 1970.

This week, investors will mainly focus on US labor market data, which are expected to remain in a deteriorating trend.

On Tuesday, the Reserve Bank of Australia (RBA) is expected to raise rates again, with investors pricing in a 50 bps rate hike, bringing the primary rate to 1.35%, likely strengthening the Australian dollar.

On Wednesday, the ISM services survey for June will come out and it’s projected to decline from 55.9 to 54.5. Last week the manufacturing ISM fell more than expected, so that the same scenario could occur again.

Additionally, the Job Opportunities and Labor Turnover Survey (JOLTS) report, which tracks job openings, hires, quits, and separations for May, will also be released. Job vacancies, which were close to a record high in April at 11.4 million, are anticipated to have slightly decreased to 11.3 million in May. A very tight labor market and high demand for workers contributed to a record-breaking 4.4 million Americans quitting their jobs in April.

Moreover, the Federal Open Market Committee (FOMC) minutes from the recent Federal Reserve (Fed) meeting are on the agenda. If they confirm the hawkish mood among central bankers, it could cause another wave of risk-off trading in the markets.

On Thursday, the Automatic Data Processing (ADP) employment report will be released. According to consensus projections, there will be a rise of 200,000 positions in May following an increase of 128,000 in April. The private-sector payroll growth has significantly slowed in subsequent months from a peak of 600,000 jobs added in February.

The headline number is scheduled for Friday when the Labor Department’s nonfarm payrolls data will be released. Market players anticipate 265,000 new jobs in June, a decrease from the 390,000 jobs gained in May. Nonfarm payrolls were 151.7 million as of May, just 0.5% below the pre-pandemic high of 152.5 million in February of 2020. Meanwhile, the unemployment rate is anticipated to have remained constant in June at 3.6%, a level it has maintained for three months in a row.

Setups for This Week:

Gold

Primary View:

Friday’s candle was really optimistic. After a long time, gold finally showed potential to increase.

The price created a hammer bouncing off the 1785 USD/oz support.

This can initiate a bullish correction aiming for the 1870 USD/oz resistance level.

Alternative View:

If the price breaks the 1785 USD/oz support level, it will cancel any hopes for a bullish bounce.

EURUSD

Primary View:

The last week ended with a defending the key support level at 1.036.

As long as the price stays above that support, buyers can still have hope for a bullish correction.

A proper buy signal will be triggered when the price breaks the red down trendline.

Alternative View:

If the price breaks out of 1.036, it will trigger a long-term sell signal.

NZDUSD

Primary View:

The NZDUSD is in a very similar situation to the EURUSD but in this case, the price has broken the horizontal support.

As for now, the breakout is a false one (yellow) as the price managed to return above the 0.62 resistance level.

The price closing the day above 0.62 should be a great buy signal.

Alternative View:

The price dropping back below the 0.62 level will re-open a sell signal on this instrument.