December 8, 2007
The Canadian dollar rose sharply against USD after the employment figures came well above forecasts. Statistics Canada reported that in the month of November Canadian economy added 43,000 jobs versus 8K which was expected by economists. The Canadian dollar gained more than 100 pips in the first minutes after the report as seen in the 5-min chart below. It stalled at the 1.0004 mark before pulling back. CAD lost some ground as both oil and gold drifted lower during the trading day, closing at 88.28 (-1.95) and at 800.200 (-6.900) respectively.
There wasn’t much reaction in the USD after the US Nonfarm Payroll report which was slightly higher than expected 93K jobs added vs 75K expected. It stayed within its recent trading range against CAD and other majors. Strong US data decreased the likelyhood of a 50bp rate cut dunring its upcoming FOMC meeting on December 11th.
Today’s Strategy: USD/CAD is bounded by two major levels: 1.0215 resistance and 0.9935 support. Long term charts show the overall uptrend in the pair. This week’s strategy - buying on bounce of 0.9935 with a 30 pip stop or buy on break through 1.0215 with 30 pip stop. |
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Posted by forexsource under Daily Trading Strategy | Comments (0)
November 2, 2007
Today’s non farm payroll report by Bureau of Labor Statistics showed an increase in employment in October. 166,000 new jobs were added vs 85,000 jobs estimated by economists polled by Thomson’s IFR Markets. Job gains occurred in professional and business services, health care, and leisure and hospitality sectors. The number of manufacturing jobs continued to decline, and employment in the construction sector was little changed.
Strong employment data show US economy is resilient and is on its way to recovery from troubles in the housing and financial sectors. The positive news gave strength to the USD in the first minutes after the report. However its strength was overrun by bullish sentiment in the EUR/USD pair. After touching the 1.4447 level the pair rose sharply to 1.4520. Euro strength is primarily based on a possible rate hike by the ECB by year end. Next week’s ECB meeting (November 8th) will be critical for the euro. If the the central bank decides to raise the interest rate EUR/USD will climb to new highs, however if the hike will not occur there can be sharp selloff in the pair.
Today’s Strategy: Wait for Mr. Trichet comments after the ECB meeting on Novermber 8th, 9:30am EST. If the comments are hawkish place a BUY order at the market, with a stop at the nearest support. If the comments are dovish place a SELL order at the market with a stop at the nearest resistance and 1st target profit
at 1.4400.
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Posted by forexsource under Daily Trading Strategy | Comments (0)
