Here is the key factor to keep in mind today for US Dollar trades:

• US NFP Report: Forex traders will receive the much awaited US NFP report today and get a look at the strength of the US labor market for March. Economists expect the addition of 245,000 jobs for March with an unemployment rate of 5.5%. Forex traders can compare this to February’s report which showed the addition of 295,000 jobs and an unemployment rate of 5.5%. Forex traders should be very careful today as the NFP report is set-up for a sharp disappointment and a headline figure below 200,000 should not be ruled out. On Wednesday the ADP report showed the addition of only 189,000 private sector jobs. This was far below the 225,000 expected. Initial jobless claims as well as continuing claims have been on the rise as well. The possibility of negative revisions for January and February pose an additional threat. The labor force participation rate is expected to remain unchanged at 62.8% which equals a US labor market in dire shape for Americans. The average hourly workweek is also expected to show no change from its 34.6 hours. Forex traders should also look for the relationship between part-time jobs and full-time jobs as a strong headline figure has been misleading forex traders. Average hourly earnings are expected to increase by only 0.2% in March and by 2.0% year-over-year. Forex traders can compare this of February’s increase of 0.1% and annualized increase of 2.0%. The US consumer has not felt any strength from the labor market which explains the contraction in consumer spending. More reason to look at the household survey for a more accurate beat on the health of the US labor market. Last month the household survey showed the addition of only 96,000 jobs and adding the estimate level of 150,000 new eligible workers which enter the labor force ach month the US may have actually added 54,000 unemployed people. This may explain the drop in US economic activity from consumer spending, to durable goods orders and factory orders as well as a weak US housing market.

Here are the key factors to keep in mind today for Japanese Yen trades:

• Japanese Services/Composite PMI: The Markit/JMMA Composite PMI was reported at 49.4 in March and the Japanese Services PMI at 48.4. Any level below 50.0 shows contraction and this was a strong disappointment as economist were looking for an increase over February’s data which showed a level of 50.0 for the Markit/JMMA Composite PMI and a level of 50.4 for the Services PMI rather than a contraction.

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