Henry Liu
Former FPA Special Consultant
- Messages
- 473
Australia Employment Change is similar to U.S. NFP (Nonfarm Payroll) and Canada Employment Change, this is an economic indicator for the Employment Changes in Australia, here’s the forecast:
9:30pm (NY Time) AU Employment Change Forecast 25.5K Previous -22.1K
AU Unemployment Rate Forecast 4.9% Previous 4.9%
ACTION: AUD/USD BUY 55.5K SELL -5K
The Trade Plan
The deviation that we are looking for is at least of 30K. Historically a 25K~30K of difference has produced about 40~50 pips of movement in the direction of the difference about 75% of the time. Expect to see the effect of this news to last minimum 45 minutes to 2 hours; typical news effect should last under 2 hours. One other important news to pay attention to is the Unemployment Rate, which is expected to stay unchanged at 4.9%. If we don’t get a conflict with the Employment Change, then we will proceed with the trading plan.
We’ll look to trade this using after news retracement trading method, we’ll wait for the market to retrace and stay out of the market during the release time. If we get a 55.5K of release, our bias will be to BUY AUD/USD; if we get a -5K of release, our bias will be to SELL AUD/USD. We’ll only enter after we see a decent retracement from the initial spike.
For more information on my trading methods:
Henry Liu's Trading Method
The Market
RBA decided to keep rates unchanged at 4.75% yesterday citing various reasons including slow Employment Growth is to be expected to continue durng the 2nd half of 2011... combine this assessment with softer commodity prices and wage growth gains, we could see an inline to a slightly worse than expected release...
Additional Thoughts
Obviously with the interest rate differentials, a weaker Employment Change will provide us with entries at much better levels... I'd recommend to buy at the bottom towards the end of the day...
Pre-news Considerations
There are no pre-news consideration for this trade.
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.”
Historical Chart and Data for AU Employment Change
Thanks,
9:30pm (NY Time) AU Employment Change Forecast 25.5K Previous -22.1K
AU Unemployment Rate Forecast 4.9% Previous 4.9%
ACTION: AUD/USD BUY 55.5K SELL -5K
The Trade Plan
The deviation that we are looking for is at least of 30K. Historically a 25K~30K of difference has produced about 40~50 pips of movement in the direction of the difference about 75% of the time. Expect to see the effect of this news to last minimum 45 minutes to 2 hours; typical news effect should last under 2 hours. One other important news to pay attention to is the Unemployment Rate, which is expected to stay unchanged at 4.9%. If we don’t get a conflict with the Employment Change, then we will proceed with the trading plan.
We’ll look to trade this using after news retracement trading method, we’ll wait for the market to retrace and stay out of the market during the release time. If we get a 55.5K of release, our bias will be to BUY AUD/USD; if we get a -5K of release, our bias will be to SELL AUD/USD. We’ll only enter after we see a decent retracement from the initial spike.
For more information on my trading methods:
Henry Liu's Trading Method
The Market
RBA decided to keep rates unchanged at 4.75% yesterday citing various reasons including slow Employment Growth is to be expected to continue durng the 2nd half of 2011... combine this assessment with softer commodity prices and wage growth gains, we could see an inline to a slightly worse than expected release...
Additional Thoughts
Obviously with the interest rate differentials, a weaker Employment Change will provide us with entries at much better levels... I'd recommend to buy at the bottom towards the end of the day...
Pre-news Considerations
There are no pre-news consideration for this trade.
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.”
Historical Chart and Data for AU Employment Change
Thanks,
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