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NFP Surprises; Unemployment Rate Dips; USD Jumps

Today, the Bureau of Labor Statistics reported Septembers Non-Farm Payroll employment change. The headline reading was 248K, which beat forecasts around a 216K print. The August number was revised up to 180K from 142K.


This strong jobs data removes concerns that would have come out from August's initial print of 142K, not that this previous reading stopped the USD from continuing its strength. In fact, the USD continued to strengthen after today's strong labor report, which also reported a dip in unemployment rate to 5.9% from the August reading of 6.1%. This also surprised most forecasts, which did not anticipate much change.


The US Dollar Index rallied and broke above this week's consolidation and high at 86.21. The next key rseistance might be in the 88.70-89.72 area, which represents the highs in 2009 and 2010, and highs since 2006. This week's breakout establishes the 85.80-86.00 area as a possible support upon a pullback. A break below this week's low of 85.50 would be needed to introduce a price top and a bearish correction scenario.

(USDX 4H Chart 10/3)