The Australian Employment Change release should provide an opportunity to trade the Aussie especially if we were to get our tradable figures. With USD remaining strong against the AUD, any weaker than expected release could drive the AUDUSD pair lower, possibly breaching the current support and push the pair to new multi-month lows.
However, if we get a positive release, then AUDUSD probably will remain range-bound as the USD is well supported.
8:30 pm (NY Time) AU Employment Change Forecast 18.9K Previous 19.8K
8:30 pm (NY Time) AU Unemployment Rate Forecast 5.5% Previous 5.5%
DEVIATION: 25K (BUY AUD @ +43.9K / SELL AUD @ -6.1K)
The Trade Plan
The deviation that we are looking for is at least of 25K. Historically a 25K~30K of difference has produced about 40~50 pips of movement in the direction of the difference about 75% of the time. Expect to see the effect of this news to last minimum 45 minutes to 2 hours; typical news effect should last under 2 hours. One other important news to pay attention to is the Unemployment Rate, which is expected to remain at 5.5%. If we don´t get a conflict with the Employment Change, then we will proceed with the trading plan.
We´ll look to trade this using after news retracement trading method, we´ll wait for the market to retrace and stay out of the market during the release time. If we get a +43.9 of release, our bias will be to BUY AUD against other currencies; if we get a -6.1K of release, our bias will be to SELL AUD against stronger currencies. We´ll only enter after we see a decent retracement from the initial spike and if we get those release numbers…
For more information on my trading methods: http://www.currencynewstrading.com/how-to-get-started-with-news-trading/
I’d recommend to use the Recommended Pairs from above as they are based on my CSM, which should provide the best combination of currency pairs to trade based on better/worse news… of course, you can also trade the default pair: AUDUSD.
Outlook score is derived from market sentiment, focus, and economic indicators for the currency. It represents the long-term trend of the currency and its market perception. In short, a strong Outlook Score means more long-term demand for the currency, and a weak Outlook Score is the opposite.
“Measures the change in number of employed people during the previous month. A rising trend has a positive effect on the nation´s currency. Job creation is an important indicator of economic health because consumer spending, which is highly correlated with labor conditions, makes up a large portion of GDP.”
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