RBS: Non-Farm Employment Change and basic trading scenarios

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Press review

Sergey Golubev, 2015.09.04 12:08

Trading NFP by Credit Agricole (based on efxnews article)

Credit Agricole expects NFP to be 220K and unemployment rate of 5.3%:

• "A NFP print in line of stronger than consensus accompanied by solid weekly earnings' gains will suggest that lift-off cannot be postponed for too long. Given that the investors have pared back significantly their rate hike expectations for September and October, a stronger NFP print will also have a more pronounced market impact in our view. We expect the USD to do well under this outcome with EUR and risk-correlated among the biggest losers."
• "A weak print, eg a NFP print below 190K and a soft weekly earnings' gain (essentially a sub 2% YoY growth), could lead the markets to pare back lift-off bets. We suspect that while negative for USD, the overall impact may be less pronounced and could see investors selling USD against JPY, EUR and CHF yet again. Any relief rally in risk-correlated currencies should prove short-lived."
  

Forum on trading, automated trading systems and testing trading strategies

Press review

Sergey Golubev, 2015.09.04 15:14

• past data is 245K
• forecast data is 215K
• actual data is 173K according to the latest press release

if actual > forecast (or previous data) = good for currency (for USD in our case)

[USD - Non-Farm Employment Change] = Change in the number of employed people during the previous month, excluding the farming industry.

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2015-09-04 13:30 GMT (or 15:30 MQ MT5 time) | [USD - Unemployment Rate]

• past data is 5.3%
• forecast data is 5.2%
• actual data is 5.1% according to the latest press release

if actual < forecast (or previous data) = good for currency (for USD in our case)

[USD - Unemployment Rate] = Percentage of the total work force that is unemployed and actively seeking employment during the previous month.

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This is ranging price movement during this high impacted news events. Ranging because of the following:

• [USD - Non-Farm Employment Change]:  173K < 215K = bad for USD related to EUR for example (the price is moved on the way to EUR)
• [USD - Unemployment Rate] 5.1% < 5.2% = good for USD related to EUR (downtrend for EUR/USD pair).

That is why ranging.

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EURUSD M5: 100 pips ranging price movement by USD - Non-Farm Employment Change news event: