Friday is shaping up to be busy for traders, with important news releases on the calendar. The key event is the Nonfarm Payrolls report in the USA. Always a big market mover and today should be no different. Analysts predict to see 196K new jobs created in December, small decline from 203K the month before. Any variation from this target could surprise the markets, depending on how large the difference is. At the same time, the Unemployment Rate is expected to stay steady at 7.0%. In addition, to make things more interesting, we will have similar data from Canada, which almost certainly will impact the CAD.
As always, I will not trade these events. This means not getting into position just before the announcement, with the intention of guessing the number AND markets’ reaction to it. I will instead try to place my typical Friday trades in the majors, looking for short-term moves after the start of the London session. If any of these trades happen, they will be closed before data release. Once the dust settles and currencies develop trends in response to employment numbers, I might trade in direction of the move, but at this point, it is speculative and entirely dependent on market’s behavior.
The trade, or rather potential trade I covered in the last post, is no longer valid. I was looking for a buy in the EUR-GBP at 0.8336, but the price moved the other way. No harm done, no trade, no loss. Better luck next time.
Mike K.