CA EMPLOYMENT CHANGE

CA Employment Change 03/09/12

7:00am (NY Time) CAD Employment Change Forecast 15K Previous 2.3k
Unemployment Rate 7.6%
ACTION: EURCAD SELL 50K / BUY USDCAD -5K

The Trade PlanThe Canadian Employment Change report will be released at 7:00am sharp today. What I am looking for is a minimum deviation of around 25K, or the difference between the Forecast number (15K) versus the actual release number; if we get a positive 40K of release, we should see demand for the CAD rise, therefore we should SELL EUR/CAD; however, if we get a negative deviation, such as -10K or worse, we should see some weakness in the CAD, and that will be my cue to BUY USD/CAD pair.
I´ll also pay close attention to the unemployment rate, which is expected remain unchanged at 7.6%. As long as this number does not conflict with the Employment Changes, we should follow the direction of the news release. If we get a conflict, such as better Employment Changes but higher Unemployment Rate, then we´ll need to look at the context of the market before taking the trade.

Additional ThoughtsUSDCAD is a slow moving currency pair, it will move on a strong deviation, but retracement is usually non-existent or very small… Therefore, if we get a strong release, especially when it is going with the pre-market trend, a sooner than later entry should add more pips to your account. Expect to see a spike down -> stall -> another spike down…