Why NFPs may not be great


Summary

  • An interesting trend
  • Quick profit in GBPJPY
  • A loss on AUDNZD is possible

SINCE 2011 - It appears I am betting against the odds into Friday. Since 2011, each an every monthly employment report out of the US in the month of September has been a disappointment. So if for whatever reason this trend continues, there is a good chance the Buck sells off today. Throw in the fact that in the lead up to today's data, we have seen a resurgence in US Dollar demand on more hawkish Fed speak and overall solid economic data. So there already appears to be room for a letdown with the data series. Still, I maintain my US Dollar bullishness even if Friday proves to be discouraging. 

STRATEGY - Into Friday, I have the exposure you already have heard about via short SPX500, short NZDUSD and long AUDNZD. I was able to catch a really quick in and out on Thursday after GBPJPY went shooting through the roof. I was alerted to the violently overbought intraday studies and jumped in to sell at 137.87, before exiting just 30 minutes later at 137.29 for 1.1% profit booked in early September. It's always nice to get a trade like that where the setup is there and produces zero pain before following through so quickly.

I may need to reconsider my long $AUDNZD exposure. Via @joelkruger

DOWN TO THE WIRE - Unfortunately, I may need to reassess my AUDNZD position early next week. I wasn't expecting the market to drop back this much and we have reached that point where I need to consider taking a loss. If we don't see any sign of reversal on Friday or Monday, that could be it for me. Still, I remain short NZDUSD and will hold the position as I believe with this one, it's just some choppy consolidation ahead of the next major downside extension. The SPX500 short is running well but I won't get excited about that one until we close below 2147. 


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We have some new trades open but they will need more time to really get going.

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