Does High-Impact Economic Data Revisit Pre-News Price Levels Due to Fundamentals or Liquidity?

Why does currency price spike 80 pips on an NFP employment data beat, only to completely retracing the entire move back to the pre-news level within two hours? Financial media outlets explain these whipsaws by pointing to underlying details inside the jobs report like revisions or average hourly earnings. In contrast, market microstructure analysts argue that news events simply act as volatility catalysts that clear out resting liquidity pools on both sides of the order book before returning to equilibrium. Is news trading driven by economic interpretation or structural liquidity clearing?