The weekly number of applications for unemployment benefits in the United States fell to the lowest level in 49 years. It does not mean, however, that there is a boom in the US labor market. Only 203,000 applications for benefits filled the Americans in the last week of August - reported the Department of Labor (this data seasonally adjusted). Even the oldest statisticians cannot remember such a low reading. For the last time, such a situation occurred in December 1969. Because the weekly statistics of newly registered unemployed are quite variable, economists like to look at the 4-week average. And this dropped to 209 500 and it was also at its lowest level since December 1969. It is worth adding a correction to the population here. Half a century ago, the US was inhabited by about 202 million people. Currently, the population of the United States is estimated at approx. 328 million.
Based on partial data, economists expect a solid Friday NFP report. The market consensus assumes that in August, 190,000 came in non-agricultural sectors jobs. Data for July were disappointing (only + 1577,000 against expected 190,000). Statistics for August will be traditionally known on the first Friday of the month at 12.30 pm GMT time (today).
Meanwhile, on Thursday, the ADP report disappointed the change in employment only in the private sector. ADP data showed an increase in the number of full-time jobs by 163,000 against forecasts of 190,000 and 217,000 (after revision) recorded in July.
It is worth remembering, however, that the statistics of the unemployed and employed do not say everything about the condition of the labor market. You can even say that they mask his real condition. According to the latest available NFP data (ie for July) in the United States the most frequently reported unemployment rate (the so-called U-3 aggregate) amounted to only 3.9%. But that's only half the truth, because if you add people discouraged from looking for a job who can not find full-time employment or are loosely connected with the labor market, the unemployment rate in the US would be 7.5% (the so-called U-6 aggregate).
Let's now take a look at the EUR/USD technical picture at the H4 time frame before the US labor data are published. The market is now back in the black channel after a bounce from the technical support at the level of 1.1529. Nevertheless, the technical resistance at the level of 1.1655 is still too strong for bulls and the price is now trading below it, just hovering around the level of 1.1627. Until the NFP-Payrolls data is published, the market will be trading inside of this range and then in a case of a better than expected data, the EUR/USD will likely spike up (risk on) and in a case of a worse than expected data, the EUR/USD rate will likely spike down (sell the USD). Please keep an eye on the mentioned levels for an erratic market behaviour during the data release time (12:30 pm GMT).
