When is the US ADP employment report and how might it affect the EUR / USD?
US ADP Jobs Report Snapshot
Wednesday’s US Economic Brief highlights the release of the ADP Private Sector Employment Report, scheduled for 12:15 GMT. A labor market recovery is an indicator the Fed uses to decide when to tighten monetary policy. Therefore, the report will play a key role in influencing market expectations regarding the likely timing of the Fed’s Fed reduction plan. After a big hiccup over the past two months, economists expect hiring to accelerate to 428K in September from 374K in August.
How could this affect the EUR / USD?
Ahead of the key’s release, the US dollar rallied closer to one-year highs and pulled the EUR / USD pair to its lowest since July 2020. A stronger impression will reaffirm speculation about an anticipated policy tightening. the Fed and will provide an additional boost. to the greenback. Conversely, a lower reading is likely to be overshadowed by the risk pulse in the markets, which should continue to act as a tailwind for the USD amid rising US Treasury bond yields. .
This, in turn, suggests that the path of least resistance for the pair remains downward. That said, the immediate reaction is likely to be short lived, as investors may wait for confirmation from Friday’s official data (NFP) before placing further directional bets.
Meanwhile, Yohay Elam, FXStreet’s own analyst offered a brief technical outlook for the EUR / USD pair: “The euro / dollar has resumed its decline and remains capped by the Simple Moving Average (SMA) 50, 100 and 200 on the four hour graph. . However, the dynamic remains positive. Bears need the price to drop below the 2021 low of 1.1562 to trigger a steeper fall. “
Yohay also provided important technical levels to trade the major: “Below 1.1562 the next level to watch is the 1.15 round line, followed by 1.1450. Some resistance is waiting at 1.1590 which provided support on Tuesday. It is followed by 1.1615, which topped the pair on Tuesday, then 1.1640. “
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About the ADP Employment Report in the United States
The Job Change published by Automatic Data Processing, Inc, Inc is a measure of changes in the number of people employed in the United States. Generally speaking, a rise in this indicator has positive implications for consumer spending, stimulating economic growth. So, a high reading is traditionally seen as positive or bullish for the USD, while a low reading is seen as negative or bearish.