ADP on Watch

The release of today’s ADP employment figures for last month is drawing more attention than usual. The report will be the first since it was discontinued in May and will reflect the new methodology being used to assess the employment landscape, said to give a more accurate reading than the prior methodology. Given the USD lull we’ve seen on the back of Powell’s Jackson Hole comments (hawkish but data-dependant), today’s data holds the potential to create fresh USD volatility ahead of the NFP release on Friday.

Market pricing for the September FOMC has been flickering between .5% and .75%. While currently sitting at 70% in favour of a .75% hike, any material disappointment today (especially if confirmed on Friday) could well see this swing back in favour of a smaller hike, sending USD lower near-term. Similarly, a strong reading today (especially if confirmed on Friday) would likely cement a larger hike, sending USD higher near-term.

Technical Views

NASDAQ

The failure ahead of a test of the 13863.02 resistance has seen the NASDAQ reversing sharply lower, now trading back under the bear channel top and the 12875.84 level. Price is currently testing support at the 12220.22 level. However, if we slip lower here, focus shifts to the 11540.72 level next.