NFP Report and Rates: Why I’m Not Making a Move Before 8:30 AM ET

I have to confess, I’m a tired trader this morning. I’m coming off a sleepless night finalizing a huge project, but I couldn’t miss this update on the current situation. Yesterday, we had a "range" day, meaning the market trod water. Why? Because everyone is waiting for the major event of the week scheduled for today at 8:30 AM ET: the famous monthly US employment report.

This figure is fundamental because it will dictate the Fed’s conduct regarding interest rates. In the meantime, there is palpable tension where the slightest anticipation error can be costly.

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The Economic Context in 3 Key Points

To fully understand what’s at stake this morning, we need to look beyond the raw number. Here are the structural elements dominating my current analysis:

1. Consensus Expectations: Experts are counting on 70,000 job creations (compared to 50,000 the previous month) and unemployment stable at 4.4%. That’s the starting premise.
2. Warning Signs from the White House: Kevin Hassett warned that job growth could slow down. The reason? A decrease in the active workforce linked, among other things, to the tightening of migration policy. In California, for example, the lack of cheap labor is starting to weigh on productivity.
3. Running Out of Steam on Consumption: Retail sales stagnated in December. Yet, that is the month when consumption should be exploding.

When Bad News Becomes Good News

This is where my favorite illustration of the moment comes in. December is supposed to be the month when Ken and Barbie max out the credit card for Christmas. However, this year, no excessive overconsumption. If the real economy starts to slip (fewer jobs, fewer purchases), this paradoxically becomes a positive signal for the stock market.

Why? Because the Fed will be forced to lower its rates to restart the machine. And lower rates are manna from heaven for the Nasdaq and AI companies that have to borrow billions to finance themselves. Basically, Wall Street is almost hoping the numbers are bad.

Technical Discipline and Prudence

On the charts, the situation confirms this expectation. All major indices (S&P 500, Dow Jones, Nasdaq) are literally stuck under their monthly resistances. It’s as if they’re holding their breath. The Dow Jones remains at very high levels, but it refuses to cross the threshold before the news.

In my view, this is where discipline makes the difference. If you are serious, you don’t take a position before the statistic. It would be, let’s be frank, pretty stupid to bet blindly in the face of such potential volatility.

A quick note on other assets: Gold is also stagnating in a tight range. As for Bitcoin, the dynamic is more worrying. It’s failing to stay above $70,000 and is sliding towards $67,000. The chart configuration suggests a heavy trend for two months now. If it breaks $65,000, a return towards $60,000 is entirely plausible.

Conclusion

In short, we are in a phase of inertia before the explosion. Everything will unlock with the 8:30 AM statistic. Until then, I advise you to keep your capital warm and observe. That’s also part of managing your risk.

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