Where does the $ go from here?
My opinion? Now is the perfect time when you need to sit back and see how all this NFP stuff is gonna work out and how the market is gonna be interpeting it. Yes I know the $ gained yesterday, but I'm not so sure we've seen the final "judgement".
The market has thrown out the validity of the monthly number; it's reacting strictly off the revisions. My question is that if the monthly number is so bad, are the revised numbers really any better? Just because the BLS has had more time to work on them? I'm not so sure and at this point, until I see further market reaction i'm not sure that the various markets (bonds, currencies, equities) feels certain either.
What should you do as a person trading the currency market? Research. Follow up on BB, Reuters the NY Times and everywhere else you can. Do the due diligence. Watch the bond market, especially the 3 month and 10 yr notes carefully. Most importantly, watch the Sunday open.
Remember that people vote with their "$'s". If the $ strengthens further (to the lower 8700's vs the GBP, about where it was prior the the last FOMC), that tells me the market firmly believes in these numbers. If it stays relatively the same, that tells me that there is serious doubt and if it starts to weaken, that tells me that more and more people in the markets don't really believe in the NFP numbers the gov't is putting out.
I know there are plenty of technical indicators that say the $ is still overbought and it is, if the NFP numbers are correct. I'm just not so sure that they are and i'm not sure are how the eventual thinking is gonna play out. But i'm not trading in this enviorment until I see a clear-cut move one way or the other. If you have a clear technical indicator and a faith in the NFP numbers, maybe you have a good set-up for shorting the pound.
Remember that unemployment (according to the BLS) and the GDP are at very low levels. That means more and more workers are out-putting less and less goods and services.
From Reuter's: Analysts said the jobs data adds to confusion about the economy's direction, since it comes just a week after the government reported the weakest expansion in more than three years in the third quarter. Gross domestic product slowed to a 1.6 percent annual rate of growth from 2.6 percent in the second quarter.
If all the numbers are correct, that situation can't last for very long. Let's see what happens.
My opinion? Now is the perfect time when you need to sit back and see how all this NFP stuff is gonna work out and how the market is gonna be interpeting it. Yes I know the $ gained yesterday, but I'm not so sure we've seen the final "judgement".
The market has thrown out the validity of the monthly number; it's reacting strictly off the revisions. My question is that if the monthly number is so bad, are the revised numbers really any better? Just because the BLS has had more time to work on them? I'm not so sure and at this point, until I see further market reaction i'm not sure that the various markets (bonds, currencies, equities) feels certain either.
What should you do as a person trading the currency market? Research. Follow up on BB, Reuters the NY Times and everywhere else you can. Do the due diligence. Watch the bond market, especially the 3 month and 10 yr notes carefully. Most importantly, watch the Sunday open.
Remember that people vote with their "$'s". If the $ strengthens further (to the lower 8700's vs the GBP, about where it was prior the the last FOMC), that tells me the market firmly believes in these numbers. If it stays relatively the same, that tells me that there is serious doubt and if it starts to weaken, that tells me that more and more people in the markets don't really believe in the NFP numbers the gov't is putting out.
I know there are plenty of technical indicators that say the $ is still overbought and it is, if the NFP numbers are correct. I'm just not so sure that they are and i'm not sure are how the eventual thinking is gonna play out. But i'm not trading in this enviorment until I see a clear-cut move one way or the other. If you have a clear technical indicator and a faith in the NFP numbers, maybe you have a good set-up for shorting the pound.
Remember that unemployment (according to the BLS) and the GDP are at very low levels. That means more and more workers are out-putting less and less goods and services.
From Reuter's: Analysts said the jobs data adds to confusion about the economy's direction, since it comes just a week after the government reported the weakest expansion in more than three years in the third quarter. Gross domestic product slowed to a 1.6 percent annual rate of growth from 2.6 percent in the second quarter.
If all the numbers are correct, that situation can't last for very long. Let's see what happens.