It’s NFP day and you know what that means – the top-tier release will likely dominate today’s market themes!

Will the closely-watched report sink EUR/USD to new sub-parity lows?

Before moving on, ICYMI, yesterday’s watchlist looked at USD/JPY’s wedge pattern resistance ahead of the U.S. NFP release. Be sure to check out if it’s still a valid play!

And now for the headlines that rocked the markets in the last trading sessions:

Fresh Market Headlines & Economic Data:

Canada’s manufacturing PMI drops to 52.5 to 48.7 vs. 53.6 expected in August

US ISM manufacturing PMI steadies at 52.8, hints at firm third quarter

US jobless claims decline for a third week to a two-month low

USD/JPY revisited 24-year highs above 140.00, eyeing August 1998 highs

Canada building permits drop 6.6% in July

Oil heads for weekly losses thanks to tighter monetary policies, China’s COVID lockdowns

Asian shares struggle ahead of U.S. payrolls report

Upcoming Potential Catalysts on the Forex Economic Calendar:

Eurozone’s PPI reports at 9:00 am GMT
U.S. NFP report at 12:30 pm GMT
U.S. unemployment rate at 12:30 pm GMT
U.S. factory orders at 2:00 pm GMT

Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️

What to Watch: EUR/USD

EUR/USD 1-hour Forex Chart

EUR/USD 1-hour Forex Chart

If you haven’t read our NFP trading guide, you should know that markets are generally expecting a slowdown in Uncle Sam’s labor market in August.

The unemployment rate may remain at 3.5% but the headline NFP could show a net increase of 295K, down from July’s 528K jobs created.

Wage growth is also expected to slow down, which would increase the Fed’s urgency to combat increasing prices stat.

A stronger-than-expected release would give the Fed confidence to go ahead and raise rates like there’s no tomorrow.

EUR/USD, which is trading inside a 135-pip range, may extend its losses and leave the 1.0000 zone in the dust.

And then we won’t be able to make memes like this:

Meanwhile, much weaker labor market numbers may convince at least some Fed members to take a (small) chill pill in their interest rate hikes.

Equities and “risky” bets like EUR may see some buyers and end the week off their intraweek lows.

EUR/USD, specifically, could bounce from its .9900 lows to revisit the 1.0050 short-term range resistance area.