7:00am NY Time CA Employment Changes Forecast 10K Previous 30.6K
ACTION: USD/CAD SELL 40K BUY -20K
Today’s high impact news event aside from the NFP will be the Canadian Employment Changes event, which is going to be our focus today. We are looking for a surprise factor (trigger, deviation) of 30K, therefore if we get a positive 40K of release, we’ll look to SELL USD/CAD; on the other hand, if we get a -20K of release, we’ll look to BUY the USD/CAD pair. With NFP coming up in about 90 minutes we have to take smaller profit target and plan our exits preferrably before the actual NFP release.
Also it is important to find out the unemployment rate, which is forecasted at 8.5%, and we’ll only trade if this number does not conflict with the employment release. If we do get a conflict, it usually becomes a battle between which surprises the market most, so it’s better to do a wait-and-see before you take a trade.
Also remember that CAD is sometimes a slow moving pair and sometimes it won’t retrace much. So consider your entries and take small profits as we do have more news coming a at 8:30am.
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.”
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