Previewing & Trading Tomorrow's Jobs Report

With the massive blowout in yesterday's ADP ADP jobs report, economists have ratcheted up expectations for tomorrow's nonfarm payrolls. Early in the week, expectations were for 140,000 jobs to be added in the month of December. After ADP said 297,000 jobs were added, expectations went to 170,000. There was a Barclay's report earlier today that said the FX markets see the potential for a print of 450,000, perhaps even as high as 580,000. Personally I don't think we see a number anywhere close to that, more likely in the low 200's, but if we do print that high, stocks could very well sell off, based on the thought process that QE2 could end sooner than any of us think. If that's the case, we very well could see a huge rally in the dollar, and investors and traders can play that by going long PowerShares DB US Dollar Index Bullish UUP. We could see selloffs in names like Caterpillar CAT, McDonald's MCD and other dollar sensitive names as well, should the jobs print be that big. Disclosure: no position in names mentioned