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US non-farm payroll in spotlight, NASDAQ presses key resistance

Main focus now turns to US non-farm payroll report today. Markets are expecting 180k job growth in May. Unemployment rate is expected to tick up from 3.4% to 3.5%. Meanwhile, average hourly earnings are expected to show another month of robust 0.3% mom growth.

Looking at some related economic data, ISM manufacturing employment rose slightly from 50.2 to 51.4, but ISM services data is not released yet. ADP private job data showed strong 278k growth. Four-week moving average of initial jobless claims fell slightly from 239k to 230k. There is nothing in these data that show significant loosening in the job market, not to mention weakness.

Fed funds futures are now pricing in 76% chance of a “skip” at upcoming FOMC meeting on June 14. Meanwhile, there is around 60% chance of another 25bps hike in June to 5.25-5.50%. The landscape could change quite notably if there is surprises in today’s data.

NASDAQ is back pressing key cluster resistance at 13181.08 after brief retreat earlier in the week. The level represents 100% projection of 10088.82 to 12269.55 from 10982.80 at 13163.53, as well as 50% retracement of 16212.22 to 10088.82 at 13150.52.

Decisive break of this 13150/80 handle will confirm underlying bullish momentum in NASDAQ, and could prompt upside acceleration to 161.8% projection at 14511.22. Let’s see how NASDAQ reacts to today’s data.

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