There is a very fine line between a soft landing and a hard landing when it comes to the economy, and the difference may come down to just a few points on the upcoming unemployment report.

A hard landing means the U.S. economy goes into a recession, said Marcus & Millichap SVP of research services John Chang in a research video. A soft landing, on the other hand, means economic growth moves very close to zero but doesn't fall into negative territory. One way economists will try to predict a potential recession is using the Sahm Rule, which compares the average unemployment rate over the past three months with the lowest monthly unemployment reading over the previous 12 months. If the difference is 50 basis points or more, the risk of a recession is high, said Chang. Since May, the unemployment rate has increased by 20 basis points to 4.1%, translating to a 43 on the Sahm indicator.

"A lot will be riding on the July unemployment rate that comes out on August 2, which just so happens to be two days after the next Fed meeting where they'll decide what to do with interest rates," noted Chang.