US Close – Fed irked by NFP shocker and ISM data, Oil sharply reverses,  Gold crushed, Bitcoin rally stalls

After a busy and volatile week that included the end of Fed Chair Powell’s hawkish tone and mega-cap tech earnings disappointments, Wall Street should not have been surprised that today’s employment report would rattle markets. An impressive nonfarm payroll report was quickly followed by a report that showed the service sector is refusing to break.  US stocks are dropping as investors realize the bearish move love with Treasury yields is over as the Fed may have to deliver a couple more rate hikes.  

The disinflation process may have begun, but a strong labor market may prove troubling for bets for inflation to continue to drop quickly.  Investors expecting that the Fed will cut rates at the end of the year might be in for a rude awakening.  We won’t see linear moves with inflation trends and that should make it unlikely for inflation to be at low enough levels to justify rate cuts. 


Wall Street is showing its true colors today.  After three disappointing mega-cap tech earnings, investors are not giving up on Apple. Apple’s results were disappointing with service businesses being the one bright spot. It looks like traders are going to rationalize the story on Apple as China’s slump weighed on their results and that should dramatically improve.  I think everyone is getting more upbeat with supply constraints and the current macro environment and are giving Apple a mulligan with this earnings miss. 

US Data

This employment report shocked many investors as what was supposed to be a slowing economy saw broad-based job growth across leisure and hospitality, health care and professional services.  The 517,000 jobs number reminded traders this economy is not yet slowing down.  The unemployment rate ticked lower to 3.4%, the lowest levels since 1969.  Everyone was expecting the economy to start to feel the impact of those earlier rate increases, but right now that doesn’t seem to be the case. 

The ISM services index also provided a monster number with a surge back into expansion territory.  Recession calls vanished after this one-two punch of strong economic data supported the Fed to keep going with those ongoing rate increases.  This round of data is pouring cold water over those rate cut bets at the end of the year. 


Energy traders were puzzled today.  Oil prices initially headed higher after an impressive jobs report was followed by a massive rebound with the ISM services reading. Recession doubts quickly vanished as this economy was showing signs it will not break. 

The crude price rally however did not last as some traders thought a strong labor market will complicate what the Fed does and keep the risk of much more aggressive tightening on the table.  The reversal with oil prices led to the reversal over what happened with stocks.  The short-term crude demand outlook should be looking a bit healthier, so this weakness might not last much longer.  Brent crude does not belong below the $80 level as the global economic outlook looks like it will be ok for the rest of the quarter. 


This gold rally was fun while it lasted.  Questions about when the Fed will be done with tightening won’t be going away anytime soon.  Gold’s rally was boosted as yields plunged on hopes that the Fed was almost done with tightening.  It looks like recession calls for at the end of the third quarter might be too early.  Gold didn’t entirely lose its bull case but it could be vulnerable to some further short-term pressure.  Next week will be critical to follow Fed speak as we might get a little more fight in how high they may take rates. 


It is rather shocking to see how little crypto is moving considering all the volatility across fixed income, stocks, FX and commodities. An impressive jobs report is driving rate hike calls and pouring cold water on those rate cut bets for the end of the year.  Bitcoin seems content hanging around the $23,000 level and that should be viewed as good news for crypto traders.  With yields likely to continue to rise, Bitcoin might struggle taking out $25,000 level over the short-term.

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at Visit to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.

Ed Moya

Ed Moya

Senior Market Analyst, The Americas at OANDA
With more than 20 years’ trading experience, Ed Moya is a senior market analyst with OANDA, producing up-to-the-minute intermarket analysis, coverage of geopolitical events, central bank policies and market reaction to corporate news. His particular expertise lies across a wide range of asset classes including FX, commodities, fixed income, stocks and cryptocurrencies. Over the course of his career, Ed has worked with some of the leading forex brokerages, research teams and news departments on Wall Street including Global Forex Trading, FX Solutions and Trading Advantage. Most recently he worked with, where he provided market analysis on economic data and corporate news. Based in New York, Ed is a regular guest on several major financial television networks including CNBC, Bloomberg TV, Yahoo! Finance Live, Fox Business and Sky TV. His views are trusted by the world’s most renowned global newswires including Reuters, Bloomberg and the Associated Press, and he is regularly quoted in leading publications such as MSN, MarketWatch, Forbes, Breitbart, The New York Times and The Wall Street Journal. Ed holds a BA in Economics from Rutgers University.
Ed Moya