Nasdaq futures bounce ahead of U.S. and Canadian jobs data

Markets are picking up the pieces after the previous session's slide. The Nasdaq 100 bore the brunt, shedding 6.36% in its worst one-day drop since March 2020. The selling was much broader than just technology names.

• Dow −3.4%

• S&P 500 −4.36%

• Nasdaq Composite −5.52%

• Nasdaq 100 −6.36%

Nasdaq futures are attracting buying interest this morning, while Dow contracts stay under pressure and European shares trade broadly lower. Given that mix, the early bounce is a mixed signal as the U.S. and Canadian jobs reports approach. The 10-year Treasury yield has also moved up, to around 4.86%. If the payroll figures surprise, my focus will be on whether yields and the dollar confirm the initial equity move or whether it fades. Asia also saw a continuation of the technology rout. investingLive Asia-Pacific news wrap

The dollar is trading higher against all the major currencies.

The dollar's biggest gains are against the NZD (+0.82%) and AUD (+0.75%). It is also up against the JPY (+0.40%), EUR (+0.39%), GBP (+0.37%), CAD (+0.30%) and CHF (+0.22%). The Swiss franc has been the most resilient of the group.

Against the yen the dollar sits near its session high, and it is close to the strongest levels of the morning versus the euro and sterling. The first test after the payroll numbers is whether those extremes hold or get broken. A quick move back into the range would indicate that the initial reaction did not draw follow-through. With the U.S. dollar running higher today, I outline the technical levels for EURUSD, USDJPY and GBPUSD.

Where currency ranges stand before the data

Looking at the quoted session highs and lows and the 22-day average ranges — about a month's worth of trading — most major pairs have met or exceeded those averages, highlighting the volatility seen today.

• EURUSD 1.1168–1.1234, 66 pips or 105% of average

• USDJPY 157.26–158.37, 111 pips or 129% of average

• GBPUSD 1.3382–1.3463, 81 pips or 116% of average

• USDCHF 0.8148–0.8189, 41 pips or 77% of average

• USDCAD 1.4009–1.4081, 72 pips or 111% of average

• AUDUSD 0.6863–0.6942, 79 pips or 161% of average

• NZDUSD 0.5541–0.5606, 65 pips or 141% of average

USDCHF still has the most ground to cover relative to its normal range. AUDUSD and NZDUSD have already stretched furthest, with risk-off sentiment and weaker growth prospects weighing on both. USDCAD has also moved beyond its average even though neither jobs report has been released. Because both reports come at the same time, a larger USDCAD move would require the data to push the two currencies in opposite directions. Stronger U.S. figures and weaker Canadian figures would favour the upside, while the opposite would favour the downside.

Equities, Treasury yields and commodities

At 8:00 a.m. ET, U.S. futures pointed to a mixed open in choppy trading.

• Dow −570 points

• S&P 500 +11 points

• Nasdaq 100 +359 points

European markets kept falling, with Germany and the UK both off more than 2%.

• German DAX −2.21%

• UK FTSE 100 −2.05%

• French CAC 40 −1.63%

• Spanish IBEX 35 −1.27%

• Italian FTSE MIB −1.06%

Across the curve, Treasury yields have moved up. They remain below the 5.36% 10-year peak reached a few weeks ago, but today's rebound suggests the downside has some limits.

• 2-year 4.491%, up 1.37 basis points

• 5-year 4.629%, up 2.09 basis points

• 10-year 4.864%, up 2.65 basis points

• 30-year 5.284%, up 3.26 basis points

WTI crude has added $0.47, last at $90.99, after ranging from $89.07 to $92.53. Spot gold has slipped roughly 0.5% to about $4,068, while silver has gained 0.58% to near $52.07. Copper sits almost unchanged around $6.27, and Bitcoin is holding steady at $76,031.

North American events today

• 8:30 a.m. ET — U.S. October jobs report. Nonfarm payrolls are projected to rise by 65K after 29K, with private payrolls seen at +64K following +46K and manufacturing payrolls put at +5K after +9K. The unemployment rate is expected to stay at 4.2%. Average hourly earnings are forecast to gain 0.3% on the month after 0.1%, with the yearly pace slowing to 2.9% from 3.0%. The average workweek is estimated to remain at 34.4 hours.

• 8:30 a.m. ET — Canada October jobs report. Employment is set to rise by 13.6K after a decline of 68.3K, and the unemployment rate is seen holding at 6.5%. Last month's drop was split between full-time employment, −35.4K, and part-time employment, −32.9K. I'll watch to see whether full-time jobs join any rebound.

• 10:00 a.m. ET — University of Michigan preliminary November sentiment. The headline index is expected at 48.0, matching October's final print. Current conditions are forecast at 48.0 versus 46.7, and expectations at 49.5 compared with 48.8.

For the U.S. release, I'll be checking revisions and wages next to the payroll headline. A payroll beat with softer wages could prompt a different yield response than a beat with stronger earnings. That difference is significant for the dollar and for a Nasdaq attempting to recover from yesterday's selloff.

From a technical standpoint, I go through the three main pairs — EURUSD, USDJPY and GBPUSD — and for each one spell out the bias, the risk-defining levels and the targets that would give buyers or sellers the upper hand.

EURUSD — Sellers are favored around the session low

The pair sits at 1.1174, a mere six pips above the session low of 1.1168. That level marks the first downside objective. A sustained break below that level would strengthen the sellers' position. Should that downside break not hold, the initial upside marker becomes 1.1200. Climbing back above that round number would put the prior close of 1.1218 in play, followed by the 1.1234 session high.

USDJPY — Buyers are challenging 158.37

USDJPY trades at 158.29, eight pips beneath the 158.37 session high. Above 158.00 the buyers hold the stronger hand, giving them a nearby level to lean on. A break and hold above 158.37 would extend the move and bring 158.50 into focus. Back under 158.00, the bias turns softer, with the prior close of 157.66 acting as the next downside reference and 157.26 after that.

GBPUSD — The 1.3400 zone is the first barometer

The pair is trading at 1.3399. Holding below 1.3400 keeps attention on the 1.3382 session low. If that level breaks on a sustained basis, sellers would gain more control. If buyers retake and hold above 1.3400, the next levels on the upside are the prior close of 1.3449 and the session high of 1.3463.