Let me start by saying that I have NO IDEA what JOLTS will print at 10 am today.
However, I do have what I think are a few interesting observations.
Since (and including) the trend high posted in March 2022 we have seen the actual print higher than the prior month actual 12 times.
On 11 or those 12 instances we have seen NFP beat to the topside.
The one failure was the NFP in July 2024 (albeit that was after the smallest prior up month on Jolts the prior month at +44k in June 2024)
Since Dec 2022. if the JOLTS change was "outsized" (over 200k) then the topside beat on NFP has also tended to be outsized (more than 100k)
For whatever reason you do not seem the same consistency when JOLTS print lower with the NFP meet/miss being a more random walk.
So, the message here is that if we print a lower number than last month's print (actual) there seems limited overall forward guidance. That does not take away from the fact that a much lower number would almost certainly get a market reaction (Fixed Income bid)
More interesting is that if we print a higher number that has had a 92% success rate in yielding a topside beat on NFP with the subsequent print.
Even more interesting is that in the 5 times since December 2022 that we have had an actual print 200k or more higher than the prior month (actual) we have seen NFP beat on the topside by 100k+
What if that happened?
If that happened and the unemployment rate came out unchanged or lower is there a chance we hear from "Vice Chair" Timiraos :-) on Friday afternoon (similar on the other side to what happened in sept suggesting the Fed could be open to a 50 bp's move- which the market did not fully buy into)
The reason for this would be "optionality". If the employment number was strong and for some reason, we got a decisive election result that yielded a Trump Presidency and maybe even a "Red Sweep" would the Fed really want to cut on 7th Nov. The reason the market gave for no 50 bps move on 18th Sept was the belief that they had not signaled it- so that logic goes out the window.
Why would the Fed not want that optionality not to move or possibly more moderately to signal that a December move was not a done deal.
The 2-year yield with its move above the pivotal 4.09% to 4.13% range (signaling a possible move towards 4.40% in the coming weeks , seems to be already sounding that alarm bell and as I write we are also seeing the 10-year yield above the pivotal 4.29% to 4.30% area.
The message here for the Bond market seems to be IF we print a positive number on JOLTS and in particular one 200k+ greater than the actual print last month the "Caveat Emptor"