Manufacturing and Services Employment Indexes Rise

Two US business data showed binding in the labour index, indicating that hiring is quite large. In addition, unemployment claims also decreased.

25bps Interest Rate Cut Not Enough to Weaken Dollar

Today's NFP data is likely to be higher than market expectations. If this happens, the rate cut may only be 25bps, which will not have much impact on the Dollar.

XAUUSD Insight

Sell: 2513

SL : 2535

TP : 2460

Recent U.S. labor data reveals strength in the job market, with significant hiring and a drop in unemployment claims. This suggests that the U.S. economy is maintaining momentum despite concerns about a potential recession. Today's Non-Farm Payroll (NFP) data is expected to surpass market forecasts, which could reduce the likelihood of a significant rate cut from the Federal Reserve (Fed).

If the NFP data confirms strong job growth, the Fed may opt for a smaller 25 basis point (bps) interest rate cut. Such a limited cut is unlikely to significantly weaken the U.S. dollar, as market participants anticipate stronger-than-expected labor performance.

On the commodities front, the gold market (XAUUSD) presents a sell opportunity at 2513, with a stop loss set at 2535 and a target profit of 2460. The strength of the dollar, combined with the Fed's conservative approach to rate cuts, could keep pressure on gold prices, making it an opportune moment for traders to consider short positions.

With closely intertwined labour data and Fed rate decisions, today's NFP results will be critical in shaping the U.S. economic outlook and market behaviour in the coming weeks.