Australia Employment Change 03/10/2010

7:30pm (NY Time) AU Employment Change    Forecast 15.3K    Previous 52.7K
ACTION: AUD/USD        BUY 45K         SELL -15K

We’ll be focusing on the Australian Employment Change release today as this news release is similar to US Nonfarm Payroll Changes, but for Australia.  This release is considered as a high impact report as the job’s market have a direct influence over the entire economy, which in turn affects inflation, and inflation will affect future RBA monetary policy.  If the actual release is better, it would be good for AUD and we would be looking to BUY AUD/USD, if the actual release is worse, it would be bad for AUD and we should be looking to SELL AUD/USD.

The safe 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, which is more than enough for us to predict market reaction… 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 hold steady at 5.3%.  If we do not get a conflict with the Employment Changes, then we will proceed with the trading plan. 

With the recent RBA decision hiking rates to 4.00% and the general risk appetite sentiment as seen in the global equity market, if this employment release surprises to the upside, expect to see AUD/USD test some resistance areas at 0.9200 or even 0.9300 in the next few days.

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.”

Related posts:

1. Australia Employment Changes 12/09/09
2. Australia Employment Changes 11/11/09
3. Canada Employment Change 03/12/2010
4. Australia Employment Changes m/m 10/07/09
5. Australia Employment Changes m/m 09/09/09
6. US Nonfarm Payroll NFP Employment Change 03/05/2010
7. Forex News Trading Canada Employment Change 11/05/10
8. How to trade Canadian Employment Change 04/09/10
9. Trade Plan For Canada Employment Change 06/04/10
10. Forex News Trading – CA Employment Change 12/03/10

Tagged as: AUD, Australia Employment, Australia News, Australian Employment, Consumer Spending, economic health, economic outlook, economy, Employment Changes, fundamental outlook, GDP, Inflation, Job Creation, monetary policy, Payroll, Unemployment Rate