The market is on edge ahead of non-farm payrolls, especially the stock market.
I think there’s a ‘barbell’ kind of skew in stocks. If the numbers are very strong it signals hikes and stocks might sell; if it’s very weak a soft economy would stir other fears. Something within 30K of estimates is good news and it will calm nerves.
The US dollar doesn’t share the same skew. Good news is good news for USD and vice versa.
I’ll be closely watching USD/JPY. Going into yesterday there were 9 straight days of gains and despite the rout in stocks, the pair hardly fell. Today the pair is back higher again and I’m starting to think it could rip on good data.
Hope you’ve got a full stomach!