IIFT Daily Note with Peter Brown

NFP, should be interesting!

Posted by:  |  Time: 7:43 am  |  Topic:
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Yesterday Mario Draghi hinted at stimulus and this was enough to drop the Euro 50 points. The outlook for the currency pair will be determined by today’s NFP number. We are expecting 200 k, but the fact is the figure could come in anywhere, so a big miss either side is entirely possible.

Let’s look at the scenarios, The market has priced in a good figure, stocks are at highs. The possible shock is definitely on the downside with a poor figure. That will certainly upset the market. Even a 200+ number is priced in in my view so we need to look to the downside for the trade. You may try a straddle trade, it will work if we get a big miss. I favour trying to get short , if it is below 200 I will sell straight away and if it is above 200 I will look at levels to fade the bounce. I have no interest to buy today.

Everything else will be driven by the number, look out for 1900 on the cash S&P that should be a big resistance level and may be a strategic sell.

Today will be Calm this morning and Choppy/hurricane this afternoon.

Levels are S&P (JUN) 1887  1875 Wall St (DFB) 16610  16525  Dax (DFB) 9690  9580 Gold 1280  1296  Euro 1.3740  1.3650

These levels will not hold on a big NFP miss.

 

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