Non-Farm Payroll, NFP Release 3rd April ‘09

Hey people, we have NFP news report coming out later today at about 830am NY time and 830pm, SGT. I hope it won’t be as boring as what we had last month, as though the news was as expected, the market hardly batted an eyelid. However, just about 30-60 mins after the release, if i remember correctly, USD completely strengthened and pairs such as gbp/usd and eur/usd tanked quite a fair bit. The unfortunate reflection of this news report is that though the numbers are as expected are sometimes weaker even, the market feels that USD is a safe currency to invest and is constantly buying USD based assets. I therefore feel that unless we see a terribly bad number, we are going to see optimism with the market, especially with the current risk appetite mentality and more buying of Gbp and Eur based pairs will happen.

Therefore, this is my plan;

With the current optimism of the market and the general weakness of the Yen, if the number comes out good, or as expected, i foresee that more optimism will settle in and we shall buy Gbp/Jpy and Eur/Jpy.

However,

If the number is rather negative, at least in the 750k region and worse, USD is going to be weak and risk aversion will settle in This will cause a better trade with the buying of Gbp/Usd and Eur/Usd.

Notice that i am using Yen for “selling” and USD for buying as i feel that with risk appetite, more strength will also benefit the USD, which might cause a mixed range movement if both GBP, Eur and Usd to strengthen at the same time. Especially, if the Usd is to gain strength, the Yen will lose strength relatively, as it is in the same class as a risk averse currency for the moment.

Hope you make some big pips today.

Happy Trading,
Seeni

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