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Forex Signal (Fri April 8 7:00am NY Time EST) - CA Employment Change

Discussion in 'Current Forex Trading Signals' started by Henry Liu, Apr 7, 2011.

  1. Henry Liu

    Henry Liu Former FPA Special Consultant

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    We’ll be getting the Canadian Employment Change release number tomorrow, here is the forecast:

    7:00am (NY Time) CA Employment Change Forecast 28K Previous 15.1K
    Unemployment Rate 7.7%
    ACTION: USDCAD BUY -5K SELL 60K

    The Trade Plan

    Canadian Employment Change report will be release at 7:00am sharp today. What I am looking for is a minimum deviation of around 30K, or the difference between the Forecast number (28K) versus the actual release number; if we get a positive 60K of release, we should see demand for the CAD rise, therefore we should SELL USD/CAD; however, if we get a negative number, such as -5K or worse, we should see some weakness in the CAD, and that will be my cue to BUY USD/CAD pair.

    I’ll also pay close attention to the unemployment rate, which stands at 7.7%. As long as this number does not conflict with the Employment Changes, we should follow the direction of the news release. If we get a conflict, such as better Employment Changes but higher Unemployment Rate, then we’ll need to look at the context of the market before take the trade.

    I'll be looking to trade this release using my after-news Retracement Method, for more information:
    Henry's News Trading Method.

    The Market
    USDCAD has been gaining on the back of the highest crude oil prices since 2008 and is continuing supported by the geopolitical situation in Libya.

    With the IVEY PMI showing a huge upward surprise on Wednesday, speculators may be expecting a much better than expected release today.

    However, if Employment were to disappoint, expect USDCAD to retrace back above mid 0.9600 to 0.9700 levels.

    Additional Thoughts
    USD/CAD is a slow moving currency pair, it will move on a strong deviation, but retracement is usually non-existent or very small... Therefore, if we get a strong release, especially when it is going with the pre-market trend, a sooner than later entry should add more pips to your account. Expect to see a spike down --> stall ---> another spike down...

    Pre-news Considerations
    There are no pre-news considerations for this release...

    DEFINITION
    “Measures the change in number of employed people during the previous month. A rising trend has a positive effect on the nation’s currency. Job creation is an important indicator of economic health because consumer spending, which is highly correlated with labor conditions, makes up a large portion of GDP. This report is the first of the month that relates to labor conditions, making it susceptible to big surprises.”

    Historical Chart & Data for CA Employment Change

    Thanks,


    [​IMG]
     
    #1 Henry Liu, Apr 7, 2011
    Lasted edited by : Sep 8, 2016

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