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How to Position Yourself Ahead of Jobs Friday

Thursday, 5 Jul 2012 | 6:15 PM ET

With private employment ramping up in June and jobless claims falling last week by the most in two months, there could be hope yet for the struggling U.S. labor market.

But new data out Thursday paints a bleaker picture, as reports showed lackluster retail sales and the services sector’s inching forward at the lowest level in two and a half years.

As usual, all eyes will be focused on Friday’s non-farm payroll employment report to determine where the market goes next, and the Fast pros are here to tell you how to trade the number.

Michelle Meyer, senior U.S. economist at Bank of America Merrill Lynch, kept her initial estimates intact. She thinks the economy should see 100,000 new jobs added for the month of June and sees the unemployment rate holding steady at 8.2 percent. The break-even level should be somewhere between 100,000 and 125,000, but since expectations for the rest of the year are set so low, “this could be the [strongest] payroll print for the rest of the year,” she said.

And while the Fed gears up to make a move, Meyer thinks a lower unemployment rate plus a mark of 50,000 jobs or fewer could spur on a QE3. Either way, she said the Fed will most likely wait until its two-day FOMC meeting in September to take any action.

June Jobs Numbers: Hot or Not?
Michelle Meyer, Bank of America Merrill Lynch, says non-farm payrolls will increase 100,000 in June, a modest pickup from the prior two months. But, will a strong jobs number take QE3 off the table? The Fast Money traders discuss.

In a bullish move, Goldman Sachs revised up its forecast for June nonfarm payroll employment growth to 125,000 from 75,000. According to a Reuters survey, the labor market is expected to have added 90,000 in June, after May’s dismal 69,000 gain. Steve Grasso, director of institutional sales at Stuart Frankel & Co., said the call has been in the 125,000-140,000 range on the trading floor.

So, how should you position yourself ahead of Friday’s big June jobs number?

Tim Seymour, founder of EmergingMoney.com said he would buy on a dip in the market, but Joe Terranova, chief market strategist for Virtus Investment Partners stayed cautious and opted to pick at certain stocks instead.

“The trend is your friend,” he said. “Stick to what’s working.” By that, he means consumer discretionary, tech stocks and select financials like regional banks.

Quint Tatro, founder and president of Tatro Capital, said Friday would yield a decent jobs report. "If the jobs report’s good, which I think it will be, short gold [against a stronger dollar]," he said earlier on CNBC's "Closing Bell."


Posted by CNBC's Kirsten Chang

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Trader disclosure: On July 5, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Tim Seymour is long BAC; Tim Seymour is long INTC; Tim Seymour is long SBUX; Joe Terranova is long VRTS; Joe Terranova is long MCD; Joe Terranova is long PNC; Joe Terranova is long USB; Joe Terranova is long TCBI; Joe Terranova is long SBUX; Joe Terranova is long MNST; Joe Terranova is long NKE; Joe Terranova is long AAPL; Joe Terranova is long UPL; Joe Terranova is long WFM; Joe Terranova is long EMC; Joe Terranova is long NXPI; Joe Terranova is long LPX; Steven Grasso is funds long ABX; Steven Grasso is funds long CUBA; Steven Grasso is funds long GERN; Steven Grasso is funds long J[Q; Steven Grasso is funds long HSPO; Steven Grasso is funds long MU; Steven Grasso is funds long NYX; Steven Grasso is funds long PRST; Steven Grasso is funds long VVUS; Steven Grasso is funds long XRX; Steven Grasso is funds long ZNGA; Steven Grasso is funds long CVH; Steven Grasso is funds long GM; Steven Grasso is funds long NYX; Steven Grasso is funds long TBT; Steven Grasso is funds long WLP; Pete Najarian is long AAPL; Pete Najarian is long AAPL CALLS; Pete Najarian is long BAC CALLS; Pete Najarian is long C; Pete Najarian is long INTC; Pete Najarian is long SBUX; Pete Najarian is long FB; Pete Najarian is long MSFT; Pete Najarian is long TJX CALLS; Pete Najarian is long NFLX CALLS; Pete Najarian is long MOS; Pete Najarian is long PCX CALLS

For Michelle Meyer
Nothing to Disclose

For Brad Lamensdorf
Brad Lamensdorf is funds short FOSL
Brad Lamensdorf is funds short JCOM
Brad Lamensdorf is funds short COL

For Scott Mushkin
Jefferies Group, Inc. makes a market in the securities or ADRs of Whole Foods Market.
Jefferies Group, Inc. makes a market in the securities or ADRs of United Natural Foods.

For Mark Chaikin
Nothing to Disclose


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