Disclaimer: This is not financial or investment advice. You are responsible for any capital-related decisions you make, and only you are accountable for the results.

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TLDR:

• September jobs release Thursday; consensus: 57k payrolls, 4.3% unemployment.
• Private data soft, volatility expected; weak print: buy $80k–$88k zone for accumulation.
• Strong print points to December hold; in-line and weak scenarios outlined for positioning.

What’s Being Released Thursday:

On Thursday at 1:30PM UK time, the Bureau of Labor Statistics publishes September's jobs report. This is the first official employment release since the government shutdown and it’ll be pivotal heading into the Fed’s December 9-10 meeting. The October and November data will follow in the coming weeks, although a specific release date hasn’t been given yet.

Private-sector indicators continue to reflect softening conditions. ADP reported a decline of 32k September jobs, the weakest reading since March 2023, while August was revised from +54k to -3k. Challenger announced 153k layoffs in October, the highest level in over 20 years. Indeed job postings are down 15% year-over-year. The BLS (who haven’t reported for several months) had shown stronger jobs numbers, but a weakening labour market overall. Private companies (ADP and Challenger) numbers’ have released more updated numbers, which have shown a more severely weakening labour market.

Consensus expectations:

• Nonfarm Payrolls: 57k (vs. +22k in August).
• Unemployment Rate: 4.3% (may not be published if the household survey is incomplete).
• Wage Growth: 3.7% YoY.

There is uncertainty over whether both payrolls and the unemployment rate will be released. Should only payrolls be published, markets may react with higher intraday volatility.

Key Data Points to Watch:

1. Prior Month Revisions.

August’s +22k print may be revised lower. A revision toward +10k or negative would reinforce the trend of weakening. June’s revision from +14k to –13k marked the first negative print since December 2020. Revisions often offer a clearer view of underlying momentum than initial estimates.

2. Unemployment Rate.

Consensus is 4.3%.

A move to 4.4%–4.5% would likely draw closer Fed attention. A move to 4.2% would conflict with weak payrolls and produce a mixed signal.

3. Wage Growth.

Expected at 3.7% YoY.

A reading above 4% supports a more hawkish stance. A reading below 3.5% would ease inflation concerns and provide room for labour-market support.

Three Possible Scenarios:

• Scenario 1: Weak Print (<20k payrolls).

Implications: Likely confirms a December cut as it’ll signal that the labour market is outright weakening, and by more than initial estimates.

Market reaction: Short-term risk-off volatility in the hour that follows for prices to then stabilise. Should this result in a move down into the $82k–$88k range, we’d view this as a buy.

• Scenario 2: In-Line Print (30–60k payrolls).

Implications: Would likely steer the Fed to holding rates at the Dec 10th Fed Meeting, but it would be dependent on other data. This would be the ‘trickier’ print for market participants and Fed members to analyse in terms of a rate decision for the Dec 10th Fed Meeting.

Market reaction: Likely see volatility with upside being sold into as the market potentially prices in a Fed that holds at their Dec 10th Meeting. We would maintain patience, with small additions considered only in the $80k–$88k region.

• Scenario 3: Strong Print (>70k payrolls).

Implications: A Fed cut at their Dec 10th Meeting will be mostly priced out should we see a strong Payrolls number.

Market reaction: Markets likely sell down on the pricing out of rate cuts. We’d look to be buyers on any price capitulation (should we get it). That zone would likely be $78k-$84k.

Ultimately, strong data would likely result in no Fed cut in December and therefore prices lower. Weak data would likely result in a December Fed cut, but market participants would potentially be risk averse over more concerning labour market weakness and therefore any rallies (in asset prices due to a Dec cut being priced in) may be sold into - upside likely limited.

Current Positioning:

We remain cautious on the market, however with the large pullback we’ve seen in the market over the last 6 weeks, we’re now more actively assessing price levels where we can start redeploying capital.

Approach into Thursday:

• Weak (<20k): Gradual accumulation into $82k-$88k on volatility.
• In-line (30–60k): Maintain patience; small adds only at $80k–$88k.
• Strong (>80k): Await October data for confirmation. But buys between $78k-$84k would be value areas.

Cryptonary’s Take:

Thursday’s release provides the baseline for labour-market assessment into year-end. However, the October and November prints will ultimately determine the Fed’s policy path for Q1 2026.

While short-term volatility is likely around the release, our medium-term view remains unchanged - a choppy market over the next 3-6 weeks, but for the first half of 2026 to be very positive for risk assets. This would be due to the combination of further monetary easing and increased fiscal stimulus ahead of the November midterms.

We will remain flexible and adjust positioning as the data evolves.

A full post-release breakdown will be provided on Thursday once the data is published.