US Non Farm Payrolls much higher - USD gains but so does risk appetite

The biggest news release of the month has just been announced, the Non-Farm Payrolls out of the USA. Basically it reports how many jobs have been lost or created. It can cause a huge amount of volatility in the market. There are actually a bunch of numbers that come out at the same time. The most important primary figure is the Change in NonFarm Payrolls, there is also the revision to last months number (they tend to get it wrong), also the Unemployment Rate and recently Change in Private Payrolls. Basically a number which is higher than the average analyst's estimate on the change and revision numbers is good for the USD, and a higher number on the unemployment rate number is bad. However, good readings on this series of data is also good for risk appetite and the stock market, this can affect the USD thou, because generally risk appetite equals higher EURUSD, GBPUSD and AUDUSD. Here are the numbers:


*(US) OCT CHANGE IN NONFARM PAYROLLS: 151K V 60KE; CHANGE IN PRIVATE PAYROLLS: 159K V 80KE
- Change in Manufacturing Payrolls: -7K v +5Ke
- Prior (Aug) Nonfarm Payrolls revised higher from -95K to -41K
- Prior Private payrolls revised higher from 64K to 107K
- Prior Manufacturing Payrolls revised higher from -6K to -2K
- Birth-Death Adjustment: +61K v +11K prior
- Aug Nonfarm revised higher to -1K from -57K
*(US) OCT UNEMPLOYMENT RATE: 9.6% V 9.6%E

Normally in the Live Futures and Forex News Trading Signal Room, we trade the USDJPY on this news, however we have noticed that the USDJPY hasn't been performing so well on news recently, while the USDCHF has. On the release of the news the USDCHF shot up about 45 pips, which was similar to the move up on USDJPY, the EURUSD however dropped some 60 pips and the Dow Jones Futures Contract, known as the YM also moved 60 points.

Included is the chart which shows the forex news afterspike trade we took in the room. The numbers were such a positive surprise, and data out of the usa has not been good, the traders presumtion was that USDCHF would higher and it did initially but in aftermath of the news as the market digested the data, the spreads on the ECN broker went inverted so it was not possible to take profit initially. The trade did then go -15 or so pips underwater, however we were confident it would come back up and it did eventually earn the room a +15 pip gain. However it could not maintain the break above the initial spike high and went sidewise and eventually drifted lower. When we don't see in the market what we expect, we accept what the market is telling us and reassess our trade positions.

Also included is the spike trade on the EURUSD, which preformed the best out of the all the pairs for a 60 pip gain. Also take notice of how a few minutes after the initial move the euro came back and tested its former swing low from below and moved off it again for a +40 pip move. This also coincided with the 61% retracement of the initial spike move. Alot better trading on EURUSD today, and we shall remember this for the next NFP. Also included is the Dow Futures Contract, the YM, showing the move there.