Non Farm Payrolls since the 1939 program inception traditionally encompasses in monthly releases a 50,000 job gain or loss range. Certain months deviate such as the next OCT release where is found a 93,000 range. But ranges are found based on consensus forecasts. This month forecast is 180,000 which means the range is 273,000 above and 87,000 below. Consensus forecasts are found at a various Median line usually the 5 year average. The problem with the next forecast and range is 180 as a consensus is not found within 20 years of data and the 93,000 range is far to wide. The best range is found between the 5 and 20 year averages at 201.30 above, 102.35 below and a 151.82 Median. The traditional release is then properly aligned at 49,000
The data dated from 1- 20 years says job gains go higher. A break of 201.30 faces next major points at 203,000, 220,000, 222, 225 and 231. Minor points are found at 145.90, 152.90 and 165. As a release, Non farm job gains are oversold particularly at the 7, 10, 15 and 20 year averages. Shorter averages from 1- 5 years are also oversold yet all face tough resistance from 201 – 231. A break is required to go higher.
Targets short term are found at 146.98, 159.35, 151.37 and 124.46. Longer term targets are found from 288.92 – 356.67. What I’m looking for are job gains between 151.82 -201.35 to ensure probable further gains later to break resistance between 201.30 – 231.
Brian Twomey, Inside the Currency Market, btwomey.com