Non-Farm Payrolls Misses, but Unemployment Rate Drops

Here's the particulars including prior, consensus and actual...

As you can see the NFP missed consensus  by 11,000, the hourly earnings month to month dropped -.1% on consensus of a +.2% gain and Private Payrolls missed as well at 140,000 on consensus of 150,000. The curious number is the unemployment rate which dropped from 9% to 8.6%, eemingly good news at first glance.

Here's how the unemployment rate dropped, workforce/labor participation dropped again from 64.2 to 64. With more people leaving the work force, the UE rate looks better, however it is not good news, it's just a function of people giving up on finding work.


The ES reaction...

3C shows a clear negative divergence in pre-market ES and a big volume spike at the highs which have dropped off since, those highs were exactly at 8:30 a.m. when the NFP was released, setting up a potential confirmation candle for the Harami patterns we saw yesterday. On of the most common is a gap up and a close below yesterday's close which is considered to be confirmation of the Harami.


Such a confirmation would look similar to this...

The first two candles are the Harami, the third which I added a little on the top, which would actually be solid green, would be the confirmation candle. When a candle is filled solid green that means it opened at the high point of the body (not including the wick) and closed at the low point, a open candle is the opposite, it opens at the low point of the body and closes at the high point, the first is bearish, the second is bullish.