ADP employment preview

ADP employment data to be released at 12:15 GMT is today's most vital dockets from US to be watched by market participants. This is part of the key data ahead of September FOMC,

What is ADP employment?

• The report is a measure of non-farm private sector employment which is obtained by utilizing an anonymous subset of roughly 400,000 U.S. businesses which are clients of ADP.

• This data is a very good measure of employment strength of the economy and a good precursor of Nonfarm payroll data.

Previous performance 

• Non-farm private sector employment grew at 185,000 in July, lowest since April. In June payroll grew by 229,000.
• Small business sector hiring at 59,000.
• Employment in franchise increased by 33,300.
• 2,000 jobs were added in manufacturing sector.
• 8,000 jobs were added in goods producing sector.
• Construction sector added 15,000 on payroll.
• 10,000 jobs were added in financial activities.
• Services sector is main job provider. Payroll added 178,000 people in July.

Expectation Today 

• Headline number is expected to rise to 201,000 as per median estimate.

Market Impact 

• Any gain above 200,000 will be considered to be good and Dollar will gain some momentum if number beats expectations by at least 30,000. However large sustained push unlikely ahead of NFP report Friday.
• Watch out for short term treasuries as better data might push yields higher as expectations rise.

FXCM US Dollar index is currently trading at 12040. Resistance remains at 12060 area, while support around 12010.