The nonfarm is back again- how the USD will be affected?
|As we all know Job creation is one of the most important leading indicators of overall economic activity in US. Thus, the publication of employment data is highly anticipated by the markets, and an unexpected reading could affect the direction of all USD related pairs.
There is no doubt that US economy is doing well and market is very much priced in for march rate hike. The market expects 190,000 jobs to have been added in February as compare to 227,000 in January. The average hourly earnings are also important which are predicted to pick up to 0.3% from 0.1% before.
There may be 4 Scenarios for this nonfarm.
- Above expectations: 192K to 194K: An unexpected higher reading can send USD cross pairs above resistance line.
- Within expectations: 186k to 191k. In such a scenario, the USD pairs is likely to rise within range, with a small chance of breaking higher.
- Below expectations: 175K to 180K: A smaller increase than forecast could push USD pairs below one level of support.
- Well below expectations: Below 175K. In this scenario, the USD pairs could break a more support levels. (but this may be for short term because we have FOMC next week)
We always recommend that traders should have patience and wait for the dust to settle down after the news because this kind of major news create too much of volatility in the market and as a professional trader one should always focus on risk management rather than doing trading for fun or doing gambling in this kind of evets. Always remember longevity in Forex trading can only be achieved through trading with good MONEY MANAGEMENT.
I always repeat in my all post that ‘it’s ok to lose the some of the opportunity rather than losing too much off money, particularly in FX business” The trade will come again next day but it’s hard to make the money back because of too much emotions and psychology involved in this business.
Good luck every one for Nonfarm !!
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