Forex Signal (Fri January 7 2011, 7:00am NY Time EST) - CA Employment Change

Henry Liu

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

7:00am (NY TIme) CA Employment Change Forecast 19K Previous 15.2K
Unemployment Rate 7.7%

The Trade Plan

Canadian Employment Change report will be release at 7:00am sharp today, and it's the first of two high impact tradable news releases today. What I am looking for is a minimum deviation of around 30K, or the difference between the Forecast number (19K) versus the actual release number; if we get a positive 50K 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 -10K 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%, a slight drop from last month’s release of 7.6%. 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 also supported by the general optimism in the USD. Thursday's IVEY PMI failed to weaken the loonie despite of just barely breaking even release at 50, CAD's short term outlook is neutral, considering the context of the market.

If we get a stronger release, we could see USDCAD push down towards the 0.9900 level again, but on a weaker release, USDCAD could trade above parity and hopefully remain there for the rest of the month as USD continue on its recovery.

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... But if I were to take a pre-news trade, I'd be looking to BUY USDCAD as IVEY PMI is hinting a possible worse than expected release today.

“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


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Crazy Cat

Former FPA Special Consultant
Fx Futures signal

Hello guys after a long break.

For those trading Futures, we are looking for a 20k surprise to ensure good follow through, although a lower trigger may be good for a quick scalp if you set your take profit to 10 ticks.
Remember that the 6C futures contract moves the opposite direction as the USD/CAD pair.
If it comes out at 40k or better, look for a rally in the 6C 30-40 ticks
If it comes out at 0 or negative, 6c should drop about 30-40 ticks
Again, this is for Fx Futures, not Forex.

If you are curious how is it to trade that kind of stuff, Douglas Ragan is going to share his desktop today show you exactly how to do it. What is more, before report releases he is going to teach a bit how to approach these reports with his spike trading methods. You will see his platform and everything else what he sees since his desktop is going to be shared with all of our members. Between the two reports there will be an opportunity to ask any questions you wish to ask regarding news trading. His main focus will be on trading the news with the other markets, such as Fx Futures but, of course, he knows the Forex market as well.

When it comes to news trading, trading the other markets is almost like trading Forex but it is easier to get a fill. If you are tired of no fills or excessive slippages, and you were always wondering how to still make money on news trading, this is a perfect opportunity that you should not pass.

This even is open for only $ 0.99 (and it covers a two week subscription). We could have it done for free but a lot of people would abuse it.

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Crazy Cat