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Trader, analyst and instructor with a 6-year experience

Citi: trading the US NFP

Citi's economists are forecasting the October NFP to come at 130K (consensus: 121K, September: 148K). Unemployment rate is expected to jump to 7.5% (consensus: 7.3%, September: 7.2%). "A good number is USD positive, but risk negative, as expectations of a December Fed Taper are dragged forward," analysts say.

Citi outlines 5 main scenarios for the today's NFP reading:

1. Below 90K (5% chance). Broad USD weakness as Taper expectations are delayed into 2014. EUR and GBP supported. USD/JPY drops to the 97 mark.

2. 90 - 110K (10% chance). Stocks positive. Buy AUD/USD.

3. 110 - 130K (25% chance). It is the most likely outcome. FX markets continue with the current trends, fading any EUR/USD strength and buying USD/JPY weakness. Immediate impact is limited.

4. 130 - 150K (45% chance). USD buying gains momentum. EUR/USD and GBP/USD weaken initially, but may gain ground later. 

5. Above 150K (10% chance). Taper expectations accelerated to December and very USD positive. Negative for the emerging currencies and stocks. 

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