The U.S labour market will be under the spotlight this week after Fed Chair Jerome Powell’s dovish tone at the Jackson Hole economic symposium last Friday. The Fed Chair suggested that an improvement in the U.S labour market is one of the remaining prerequisites to start tapering.

The U.S non-farm payroll (NFP) report is a key economic indicator and will be released this Friday the 3^rd of September 2021 at 14:30 SAST with much fanfare. The report is intended to represent the total number of paid workers in the U.S. minus farm employees, government employees, private household employees and employees of non-profit organizations.

Here is what’s expected this week:

The U.S Non-Farm Payrolls (NFP) 

We might see an upset in this week’s jobs number if the average analyst expectations come to fruition as new Delta variant infection cases pick up once again.

Jobs number:

The number of U.S Non-Farm jobs for the month of August is expected to come in much lower than the previous reading for July 2021 at 750K new jobs.

Hourly earnings:

The average hourly earnings (M/M) (Aug) data is expected to decrease slightly to 0.3% while the average hourly earnings (Y/Y) (Aug) is expected to remain unchanged at 4.0%.

U.S. Unemployment Rate:

The U.S. Unemployment Rate (Jul) is widely expected to come in at 5.2% this Friday.

The unemployment rate measures the percentage of the total workforce that is unemployed and actively seeking employment during the previous month. The unemployment rate data point can be used as an indicator to see if an economic recovery is underway.

The Wall Street 30 Technical Analysis

U.S Indices had some spectacular runs over August which saw the WS30, Nasdaq and S&P 500 reach new all-time highs throughout the month. The U.S Dollar Index (DXY) remains under pressure for now and has seen a slight rebounded from a three-week low point. The oil market will also become topical this week with the OPEC+ meeting today which could see the group decide to go ahead to add supply to the market.

Volatility is expected over the week as events unfold but our major levels of interest on the Wall Street 30 (WS30) remain unchanged at this point. We did see our 35183-support level hold and price move higher from the level as discussed in our previous WS30 note.

• Volatility is expected this week, but we need to see volume return to support a move through 35515 to target our possible long-term target at 36030.
• The 50-day SMA (blue line) is acting as support to the price action.
• The Relative Strength Index (RSI) is above the halfway point and needs to push higher from here to support the long outlook.

Chart Source: Wall Street 4H Timeframe  - GT247 MT5 Trading Platform

Why is the jobs number important?

The Non-Farm Payrolls report (NFP) is treated as an economic indicator for people employed during the previous month, and the number being released will have a direct impact on the markets. In the United States, consumer spending accounts for most of the economic activity, and the Non-Farm Payrolls report represents 80% of the U.S. workforce. Farmers are excluded from the employment figures due to the seasonality of farm jobs.

Trading Term of the day:

U.S. Unemployment Rate:

The unemployment rate measures the percentage of the total workforce that is unemployed and actively seeking employment during the previous month. The unemployment rate data point can be used as an indicator to see if an economic recovery is underway.

When does the Non-Farm Payroll Announcement take place in South African time?

U.S Non-Farm Payrolls (NFP) report is live this Friday the 3rd September 2021 at 14:30 SAST

Take note: The outlook and levels might change as this outlook is released during the current days (Wednesday the 1^st of September 2021) U.S Market open.

Sources – MetaTrader5, Reuters, Investing.com.

Barry Dumas | Market Analyst at GT247.com

Barry has 12 years of experience in the financial markets. He enjoys educating clients on trading / investing and providing punchy technical analysis on securities. He currently holds a Wealth Management qualification and is studying towards becoming a Chartered Market Technician® (CMT) designation holder.

Disclaimer:

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