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Daily Outlook: No trading idea today as it is Friday and the NFP is due out. Big money stayed out of the markets yesterday in anticipation of the NFP today and left us with some pretty boring price action.
NFP Report Driving Price
Non-farm payrolls (NFP) are the most closely watched indicator of US employment situation, as it is the most comprehensive gauge of job creation (excluding the farming sector). Last month there was a -131k drop in the NFP and analysts expect -105k this month. Fundamentals 101 would tell us that a report better than -105k indicates an improving US economy, which would strengthen the USD in anticipation of future rate hikes. Recently however the themes of risk have been a much better gauge of how the markets will receive news. In these risk averse times we generally see the opposite happen of what you’d think for basic fundamentals: bad US news drives the USD up as traders seek the relative safety of the US dollar compared to what they judge to be riskier economies (and being the reserve currency doesn’t hurt either). Tagging along with NFP report is the unemployment rate which is expected to increased slightly this month.
Does that mean for sure that the E$ will go up if the NFP is good? Of course not. For all we know big money priced in an NFP drop earlier two weeks ago :).
Have a safe Friday and a good early weekend (or good luck trading to those who feel the need). Happy pipping!
P.S. CandlePro email went out a few hours. If you haven’t already read it there is a CandlePro enrollment session this Sunday at 2p GMT. Read all about it here.
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September 3, 2010 at 13:19
We’re pushing into hourly overbought in lots of these markets. SPX is nearing resistance and has a gap to close
September 3, 2010 at 13:28
EUR/AUD finding support at its 4 hour trendline support
September 3, 2010 at 13:49
“Ignorance more frequently begets confidence than does knowledge.” Charles Darwin
September 3, 2010 at 13:20
GBPUSD can’t conquer 38.2% retracement and comes back off: The price is back between the trendlines now
September 3, 2010 at 13:23
$index still looks heavy tho and 82 to 78 still possible
September 3, 2010 at 13:24
ya’ll have a good day and good luck
September 3, 2010 at 13:24
Same to you my friend. Good weekend
September 3, 2010 at 13:25
nice like usually ttom but y are better wt y avatar
September 3, 2010 at 13:25
Im out too for a while. Back later
September 3, 2010 at 13:27
@piphut do u think that UCAD gonna rebound back to long with the speculation on E$
September 3, 2010 at 13:33
It is right at rising trend support right now on the 4h, which is also the open price of 2 weeks ago so we could see some sort of bounce but I would prefer to see short on a sustained break of that support or wait for a bullish candlestick confirmation to the trade
September 3, 2010 at 13:46
by Kathy Lien
The U.S. dollar skyrocketed after the stronger than expected non-farm payrolls report. Not only did the headline number surprise to the upside, but private sector job growth beat expectations with the July figures also revised sharply higher. This positive non-farm payrolls number will bring relief to both the currency and equity traders and suggests that September may actually be a good month for the financial markets. Given the global impact of the U.S. recovery, everyone around the world will be cheering this report.
Non-farm payrolls fell by only 54k in August, compared to the forecast for 105k job losses. The July figure was revised higher from -131k to -54k. Private sector payrolls rose 67k against a 40k forecast with the July number revised up from 71k to 107k. Excluding Census workers, August payrolls increased by 60k. Cutbacks forced government workers to slash 121k jobs last month but U.S. corporations picked up the slack. The only black mark in the report was the unemployment rate which rose from 9.5 to 9.6 percent.
Although this was the third consecutive month that more jobs lost than acquired, this is the best outcome that investors could have hoped for. The stronger non-farm payrolls report will reduce the pressure on the Federal Reserve to implement additional Quantitative Easing and practically guarantees that the central bank will make no new announcements on Sept 21st. Central bank officials will be able to enjoy the Labor Day holiday with a lighter heart knowing that the labor market is moving in the right direction.
It is no secret that U.S. corporations are flush with cash and the non-farm payrolls report suggests that they are beginning to spend their money by increasing their workforce. The sustainability of the improvement is important but the August number along with the July revision already indicates that job losses in the third quarter was not as bad as previously feared.
As long as the non-manufacturing ISM report at 10am NY Time is not horrendous, we expect the U.S. dollar to hold onto its gains against the Japanese Yen and the EUR/USD and GBP/USD to remain firm as long as equities trade higher during the North American session.
September 3, 2010 at 13:55
that’s a nice day and some lessons learn by me over the news impact in the market….i am off till next week….u guys have a nice trade ahead for any one on trade……and wax more stronger till the upper.
September 3, 2010 at 14:14
dollar index is at new lows so top on Euro may be near, its looking bullish on the weekly and monthly charts
September 3, 2010 at 14:19
for those who are unaware- CHF x’s are considered RISK OFF (when long CHF) THUS AUD/CHF BEHAVES like AUD/JPY and AUD/USD .
September 3, 2010 at 14:38
Hi ttom, pls expatiate. tnx
September 3, 2010 at 14:45
in todays market it is the cross pairs that have been making the best and safest pips, look at the strongest currency and then look at the weakest, not always the majors, chf has been strong so long CHF has been a no brainier trade the past few weeks for easy pips against almost any pair, you then look for trades to take that compliment the market strengths and current trades you may be in
September 3, 2010 at 14:46
reality will set back into the markets soon
September 3, 2010 at 14:30
quick 40pips from shorting usd/chf
September 3, 2010 at 14:34
nice ;me i m fighting with cad!!!!
September 3, 2010 at 14:42
Wao! hope ur SL is in place. i got my earlier short on fibre stoped out eventually. hence my trading today to collect from peter to pay paul.
September 3, 2010 at 14:34
and short eu
September 3, 2010 at 14:45
i will b closing for the week shortly. have agreat weekend and c u all (did i just say see) nexxt week. cheers
September 3, 2010 at 14:57
Have a great long weekend. Monday is US holiday.
I sliced 10 pips from USDJPY short. That’s all for today, considering the huge event risk.
There was both very good and very bad US news. I certainly hope EU finds direction next week. We shall see.
My Stocks made $910 today, closing very well for the week.
That plus 10 pips in my pocket, time for celebration.
September 3, 2010 at 14:58
Thanks for another nice Piphut Week! Thanks Mark for your work and this phantastic tool! I wish you all a nice weekend!
September 3, 2010 at 16:33
@SAHARA Back again and I see my Long still doing well :-)What abt you?
Nice to see my yesterdays trade idea will reach its target soon :-)
Thank you my little Bully …
September 3, 2010 at 16:36
With avatar its better…
September 3, 2010 at 16:41
EUR/USD testing its 38.2% retracement level around 1.2880 and this may provide some near term resistance. This is the retracement from the August highs to the August lows
September 3, 2010 at 17:24
good trade Johnny, the bull turned the game to KICK boxing where they also stand the chance of winning. Congratulations for a win-win day
September 3, 2010 at 17:27
retracement in a upmove dhoulf find support, saying 1.288 is a resistacne could mean bear may come and handle the interval,
September 3, 2010 at 17:41
I think retracement comes in at or just above 2900 and (If we reach this level) I plan to Short from there.
One of the reasons I kept looking Up (North) was the Bullish Flag Pattern on H4 yesterday, which means the trend will continue.
Have a good weekend Kayus and take care.
September 3, 2010 at 17:45
tnk u, sre u off for the weekend now? have a refreshed wkd
September 3, 2010 at 17:31
Hey just wanted to stop by and wish you all a wonderful week end…:)
September 3, 2010 at 17:33
Did you get a new email address Matthew or am I thinking of the wrong Matthew (is your username @iplusthree)?
September 4, 2010 at 06:18
Hey Mark yep it’s me.. I lost my login info and the email it was attached to I closed do to junk mail.. So I was unable to get the new password.. I can open a new account and you can delete the other one if you want I would rather go by Matthew on the forum anyway.. Just let me know :)
September 3, 2010 at 17:42
Same to you Matthew.
@PIPHUT And Mark, you too. Enjoy the extra day :-)
September 3, 2010 at 17:45
BTW….So you wont be passing a Signal on Monday then???
As I think in the rest of the world Forex goes on.
September 3, 2010 at 17:50
I’ll be working all weekend so drop a line if you are online. No signal on Monday but I’ll still send out an email if anyone wants to chat on a fresh post.
September 3, 2010 at 17:54
Good to know, thanks.
September 3, 2010 at 19:58
i ‘ll. Pls tell me and me alone do you live on FXalone?
September 3, 2010 at 17:43
@piphut Thnaks once again for your efforts in creating a community of succesful traders. BUt please i will appreciate your response to my earlier request in respect to the CP. Thank you
September 3, 2010 at 18:08
G/U is about at the end of the line.
September 3, 2010 at 18:15
we will be together on monday then!
September 3, 2010 at 18:30
Yes my friend, together with Mark we might be the only ones :-)
Btw…Dont look to deep to the South! Personally I think this may go up quite some more once we breach 2900.
Like I mentioned earlier to you, we def. need to book a room at Hotel 1,30 next week :-)
September 3, 2010 at 18:52
if 2880 stay “strong” so i think so next level near 31
September 3, 2010 at 19:28
reserve a seat and ROOM for me too. i expect it to reach 1.33 before nose diving but we may experience partial reversal b4 the ultimate climb.
September 3, 2010 at 19:33
Ha ha… Thats alright Kayus, but we need a 4th man then to have a good card game :-)
With the US stocks up today and US closed on Monday the Asian and Europe Stocks will probably surge up on Monday and so I expect some more highs by then. Lets see.
I hear a US plane has crashed in Dubai, gonna watch the news now about it.
See you at closing time and have a nice weekend.
September 3, 2010 at 19:30
What a bloody awful afternoon it was trading the euro. I’ve said it once and I’ll say it again. Nothing wrong with that is there, I hope!
September 3, 2010 at 19:33
Awaiting moderation??? So I have been put on surveillence I see. For what exactly? I knew my comment had been taken off. How stupid…
September 3, 2010 at 19:34
sorry @simon – the word ‘bloody’ automatically kicks a comment into the moderation queue
September 3, 2010 at 19:37
Clever thing, that moderation queue.
September 4, 2010 at 07:41
LOL. That’s a popular Brit expression…
September 3, 2010 at 19:31
@johnny 5 pips to the target of the week 1.29. Johnny, are u picking you profit now or hoping for higher height? or are u shorting now?
September 3, 2010 at 19:36
No not thinking of shorting as yet Kayus. Might consider leaving my trade open during the weekend. Normally I dont leave trades open in the weekend, only when I am certain about it :-)
September 3, 2010 at 19:40
Do you see any gapping either way when it opens on Sunday evening?
September 3, 2010 at 19:43
A Gap could be possible but not necesarily need to occure.
September 3, 2010 at 19:47
when did u went long?
September 3, 2010 at 19:52
Sorry , was checking the news on the crash/ Went Long @ 2780
September 3, 2010 at 19:53
gap up or down? which can u foresee?
September 3, 2010 at 19:54
What do you think? :-)
September 3, 2010 at 19:56
@KAYUS Please trade your own way. No need following no-one, everybody has his own way of thinking and viewing. I may be totally wrong!
Take care
September 3, 2010 at 20:12
Sure, i trade my plan but use others confluence as trades confirmation to gauge my strategy.
September 3, 2010 at 19:45
A good week for stocks sees the S&P 500 forming a weekly bullish engulfing candlestick…
Also a bevy of interest rate announcements await next week…
September 4, 2010 at 07:43
Including a “coin flip” on the Bank Of Canada raising rates ;)
September 3, 2010 at 19:55
hope the pilot in the crash didnt lose out in hos forex trade resulting in the crash?
September 3, 2010 at 20:15
good night nad do have a great wkd @johnny @johnr @piphut Thanks for being there while the week last.cheers and cheerio!!!
September 3, 2010 at 20:19
And same to you my friend, my pleasure. Together we can make it or break it :-)
September 3, 2010 at 20:16
Kayus, it seems we are the only ones left in here? Or is there any other traders around still? They are very silent then I must say :-)
September 4, 2010 at 07:46
Yes it was a kick-ass week with several kick-ass trades on my part. Let’s keep the momentum going…
September 3, 2010 at 20:18
Would be nice breaching 2900 before closing of the market! Lets see
September 3, 2010 at 20:44
saw ur response in my mail. it is good week i must say but can hope that next week will be better, i noted a pair with strong trend, will explore it next week USDSGD
September 4, 2010 at 07:44
Into monday E/U long & strong baby!
September 4, 2010 at 08:13
Hi guys!
What do U think about the EUR/JPY, it’s gonna goin’ back to 107 next week? or what?
Have a nice weekend!
September 5, 2010 at 17:00
Potential Strategy
Sell EUR/USD at 1.2985. Stop at 1.3220. Profit target at 1.2435.
What is the trend? Down
Why is this significant? Broken bullish trend line could provide new resistance.
Reason for Strategy
We updated both the entry (1.2985) and the stop (1.3220) on this trade although it is the same basic idea that has been posted for the past two days. We rose our entry from yesterday because the bullish trend line obviously moves up over the course of 24 hours. The broken trend line could provide new resistance near 1.2985 if that level is tested in the next 24 hours.
Trade Invalidation
The trade is invalidated if the trade does not enter by 6pm eastern time tomorrow (9/6/2010).
September 5, 2010 at 22:46
i agree with u friend and am waiting for 1.298 ro come in isgh soon. Have a great week ahead.
September 5, 2010 at 22:42
@johnny did i hear mention that u dont like oaying money but only orefer collect talking about CP? As much as i wish to subscribe but Mark doesnt support Paypal alternative while i dont have access to paypal, If u didnt subscribe that measn we shall b seeing u more in this section of the forum. Good news. But if u eloped with the CP guys then remember to drop in now and then. Happy new week. NExt target on e/u is 1.298 after that maybe we can reach 1.32 and maybe higher BUT i suspect the flight might have reached the airport by then and then require landing to 1.24 region. Cheers