Canada Employment Change - Big Deviation, Big Spike and Continuation - like the old days

This Thrusday afternoon, at 13:30 GMT (8:30 EST) the Employment figures were released out of Canada. This data is normally on Friday's but it is Easter tomorrow, it also is normally at 7:00 EST but the BOE was doing there Interest Rate decision at that time so it was good they moved it to the 8:30am slot. Finally also normally NFP is only 90 minutes after this data, so it was good it wasn't today because the Canadian Dollar had time to just trend and continue without any worry of NFP coming along and changing everything in terms of the US DOllar or the Japanese Yen or Risk sentiment in general.

The market had been risk off in general..bad Spanish bond auction yesterday sparked renewed concerns and the Euro extended the sell-off already instigated by the Fed Minutes on Tuesday.

Anyhow here is that Canadian Data:


Canada Net Change in Employment
Estimates- Median: +10.5k Average: +13.2k Low: +5.0k High: +40.0k
Actual: +82.3k Prior: -2.8k No Revision

Canada Unemployment Rate
Estimates- Median: +7.4% Average: +7.4% Low: +7.4% High: +7.5%
Actual: +7.2% Prior: +7.4% No Revision

Canada Full Time Employment Change
Actual: +70.0k Prior: +9.1k

Canada Part Time Employment Change
Actual: +12.4k Prior: -12.0k

Here are some 10 second charts:

The USDJPY which has been selling off since reaching 84.00 on March 15th, did take a turn back up and thus supported further gains on CADJPY.

A rumor of a major European bank in trouble which might need to be nationalised hit the wires about 10-15 minutes after the release, this helped the sell-off in the EURCAD and also made it more difficult for the USDCAD to sell-off. But this was probably just some BS the brokers paid the news wires to send down to the retail side, and it soon washed off and EURUSD bounced back up after hitting a significant fib level at 1.3050.

As this final 1 minute chart on the USDCAD forex pair shows the move developed some good momentum which continued for about 3 hours.

Bank of Canada - Interest Rate Statement strengthens the Canadian Dollar

This Thursday afternoon of March 8th 2012 at 14:00 GMT (9:00 EST) the Bank of Canada released there announcement on Interest Rates. All analysts surveyed expected no change from the Central Bank, however they do release a statement about why they decided not to change the rate this time.

These statements are watched by the market to see if they give any clues about the next move from the Bank of Canada. Sometimes they include revisions to the Central Banks forecasts on GDP and CPI inflation.

Anyhow as expected the BOC left rates unchanged at 1.00% however they did make some positive statements on growth, they also said that monetary policy was already low and there was lots of stimulus which sounded like "we are not going to be giving you anymore because you already have enough"...this is what a parent says to a little child when they ask for more candy. The markets want candy, which is cheap money dumped on them from Central Banks. ;)

Anyway here is a link to the statement.

The Canadian Dollar appreciated by about 40 pips, however in the heat of the moment it may have been difficult to catch it if you were still reading thru the statement. There must be algorithmic language processing programs that interpret the statement pretty quickly. Here the charts:

First is the 10 second chart of the USDCAD

This is the 10 second chart of the CADJPY

Canada Ivey PMI - much better but markets in Risk-Off and don't care

This afternoon at 15:00 GMT on Tuesday March 6th 2012 (10:00 EST) the Ivey PMI figures were released from Canada. These numbers usually do not cause much of a reaction unless there is a very big deviation, however sometimes a more modest deviation can cause a slower trend to form.

The figures were quite good, however the market is in Risk-off mode as the amount of PSI involvement of the Greek Bond Swap deal is very much getting attention as the final deadline approaches.

Here is the data:

Canada Ivey Purchasing Managers Index
Estimates -> Median: 62.0 Average: 62.4 Low: 58.5 High: 66.0
Actual: 66.5 Prior: 64.1 No Revision

Here are 2 quick 5 minute charts of USDCAD and CADJPY forex pairs, just for the record...

Canadian Ivey Purchasing Managers Index - Higher Print leads to reversal

This afternoon of Monday February 6th 2012 at 10:00 EST (15:00 GMT) the PMI figure was released from Canada. This figure has not been affecting the price of the Canadian Dollar very much unless there is a very large deviation. However if one is trading longer term it can support the general direction of the trend.

Today saw a decently higher print on this, not enough to trigger a trade. Often Canadian data gets leaked but regardless if it was a rumor or just good analysis the USDCAD sold off into the news. Of course a lower USDCAD means Canadian Dollar strength. When the news was released there was a small blip, but then a reversal of about 20 pips over then next 45 minutes before the down trend re-established itself. Here is the data:

Canada Ivey Purchasing Managers Index
Estimates- Median: 59.7 Average: 58.9 Range: 54.0 to 62.0
Actual: 64.1 Prior: 63.5 No Revision

I include 2 charts, the USDCAD and the CADJPY, both 1 minute charts. These 2 pairs traded inverted to one another. When CADJPY hits resistance at the same time as USDCAD hitting support, there is a good probability of them bouncing some.

Canadian Employment lower - leads to moderate upmove

This Friday morning of February 3rd at 12:00 GMT (7:00 EST) the Employment figures where released from Canada. Basically this used to be the best news to trade, even better than the most well known Non-Farm Payroll news. However when big variations in Full time and Part time Employment were taken into account, the Canadian Dollar forex pairs stopped reacting so well to just the Employment Net Change deviation.

Recently the Australian Employment Change figures have come with analsyt estimates for Full Time and Part Time Employment Change, this has not yet happened for the Canadian Numbers, so we have to compare this months number to the prior number. So although there was a quite significant deviation lower on the Net Employment Change figure from Canada today of -19.7, as well as a 0.1 deviation on Unemployment Rate the USDCAD did not move that much higher. In the past a deviation of this sort would move the pair at least 50-60 pips easily, if not 80. When we look at the Full Time Employment Change we see that this number improved, so the drop which caused the deviation in the Net Employment Change number came from Part Time Employment.

Here the figures:

Canada Net Change in Employment
Estimates- Median: 7.5% Average: 7.5% Range: 7.4% to 7.5%
Actual: 7.6% Prior: 7.5% No Revision

Canada Unemployment Rate
Estimates- Median: +22.0k Average: +22.2k Range: +5.0k to +45.0k
Actual: +2.3k Prior: +17.5k No Revision

Canada Full Time Employment Change
Actual: -3.6k Prior: -25.5k No Revision

Canada Part Time Employment Change
Actual: +5.9k Prior: +43.9k No Revision

Canada Participation Rate
Estimates- Median: 66.6 Average: 66.6 Range: 66.6 to 66.6
Actual: 66.7 Prior: 66.6 No Revision

Here is a 10 second chart of the USDCAD forex pair. Very modest spike for such a economic news deviation:

This is a 30 second chart of the CADJPY pair:

Next is the 1 minute chart of the pair. Over the next 90 minutes the USDCAD did go on to make another high at 1.0030, making a total of about 30 pips on the move. However with Non-Farm Payrolls out at 8:30 EST (13:30 GMT) this move up got quickly erased. The Red Arrow is the Canadian Employment Change Release and the Green Arrow is the US Non-Farm Payroll Release:

This 2 minute chart shows how the USDCAD came off its lows during the European session and moved up about 40 pips ahead of the econonmic new release:

This 3 minute chart shows the move for the whole day, leading into the Canadian Employment Data then into the US Non-Farm Payroll to finish the week:

This 1 minute chart shows the CADJPY move thru the Canadian Employment into the US Non-Farm Payroll:

Canadian GDP - Lower than expected with decent move given some time

Today, 31st January 2012, at 8:30 EST (13:30 GMT) the GDP figuresw were released from Canada. They did come out lower at -0.3% on the MoM which is a moderate deviation. There is not really much history of a 0.3 deviation. In the past deviations of 0.1 or 0.2 have not worked well, but deviations of 0.4 have been tradable, so this was in between and the price response on the USDCAD forex pair was moderate for the short term spike, but given some time it did run on for more pips.

Here is the data:


Canadian GDP MoM
Estimates- Median: +0.2% Average: +0.2% Range: -0.2% to +0.3%
Actual: -0.1% Prior: 0.0% No Revision

Canadian GDP YoY
Estimates- Median: +2.3% Average: +2.3% Range: +2.2% to +2.5%
Actual: +2.0% Prior: +2.7% No Revision

Canadian Industrial Product Price MoM
Estimates- Median: -0.1% Average: 0.0% Range: -0.5% to +0.5%
Actual: -0.7% Prior: +0.2% Revised: +0.3%

Canadian Raw Materials Price Index MoM
Estimates- Median: 0.0% Average: +0.2% Range: -1.0% to +2.3%
Actual: -2.4% Prior: +3.8% No Revision

Here is the 30 second chart of the USDCAD forex pair, notice the 20 pip spike, then chopped around for half and hour before pulling back a bit then shooting higher:

Here is the 5 minute chart of usdcad which shows how given time the pair did move quite well for about 70 pips:

Also included in a CADJPY 1 minute chart which shows the pair thru the rest of the session which also had US Chicago PMI later which added to its move down:

Canadian Retail Sales - Slightly better but also slight revision down

Today January 24th 2012 the Retail Sales figures were released from Canada. Both the main Headline figure and the Core Less Autos figure came out with +0.1 deviations above the median estimate, however there were also revisions to last month's figure of -0.1. The USDCAD forex pair had been trending up into the news. The news hit and the pair wiggled a bit but then made a slightly higher high, coming up into the R1 Daily Pivot (based on London Midnight Close)...this is one of those instances where you can actually fade the move after news. This was because there was a move up before the news likely driven by expectations of a weak number, but also because there was a general pullback in risk-appetite thru the european mid-day and early new york session, which saw the US Dollar gain. When the numbers came out mostly flat and USDCAD moved into the technical resistance zone it was a good probability trade to fade the news move.

Here are the figures:

Canada Retail Sales MoM
Estimates- Median: +0.2% Average: +0.1% Range: -0.3% to +0.8%
Actual: +0.3% Prior: +1.0% Revised: +0.9%

Canada Retail Sales Less Autos MoM
Estimates- Median: +0.2% Average: +0.2% Range: -0.1% to +1.0%
Actual: +0.3% Prior: +0.7% Revised: +0.6%

Here is the first chart which shows the 30 second chart of the USDCAD, showing the little wiggle and then slightly new higher high into the 1.0140 zone of resistance.

Next is the 5 minute chart which shows the fade trade called live in the room a few minutes after the news was released and R1 was hit:

Currency COT Report for January 20th 2012

Bank of Canada hold rates steady at 1% - USDCAD gets choppy whipsaw

No analysts expected a change in Interest Rates today at 9am EST (2pm GMT) from the Bank of Canada today. Last month there was a rumor that the Bank's Governor Carney would sound dovish and signal rate cuts in 2012, but he did not, thus last time the USDCAD did have a strong move down.

This time there were no such expectations, although there are a few who still expect a cut sometime in the 1st half of 2012 as Australia, norway and sweden cut last month. Canada figures have not been bad but Carney's comments mentioned the situation in Europe, so basically the Bank of Canada remains on hold. Perhaps the slight upward bias on USDCAD (Canadian Dollar weakness) could be attributed to his emphasis on the crisis in Europe

If you look at the Statement Here for Bank of Canada Rate Decision Statement for January 17th 2012

you will notice it really isn't that much different than the Rate Decision Statement for December 2011

What is different was they revised their GDP forecasts while keeping inflation forecasts the same. The last time they gave GDP forecasts were during their October 2011 Rate Decision Statement so although they forecast 2.1 for 2011 it came out at 2.4, so they raised GDP for 2012 from 1.9 to 2.0 but lowered GDP for 2013 from 2.9 to 2.8...so a mixed bag so to speak.

Anyhow here is a 10 second chart of the whipsaw on the USDCAD:

Of course the forex pair had moved down quite a bit overnight, so a bit of a retracement was due. The market was preoccupied with talk of S&P downgrading European Banks after their Downgrades of several European countries on Friday January 13th.

Scalping the Loonie USDCAD pair - Don't trade in low volume holiday markets?

Many will warn of the dangers of trading when volume gets light and liquidity in the market drains away in the run up to Christmas, Thanksgiving, Easter and the August Summer holidays. Well definately it is good to take some time off, recharge the batteries and unplug from the dam computer, eat real home cooked food and enjoy the company of friends and family...but why not make some pips if you are waiting for that turkey to bake or family to arrive or to catch your plane.

If you have some good analysis why not. Holiday markets can take 2 shapes, 1. moves can be exacerbated because some big-pockets can swing things around on the cheap, or 2. things might not move much at all or in tight ranges.

Today was Friday December 23st, how lucky that Christmas is on a weekend this year and the Forex market is open Sunday night December 25 all the way to Friday December 30th because somewhere on the planet they don't have Christmas...joking...lol. Not alot of news out of Europe but North America had Canadian GDP and the USA had a bunch of smaller economic news reports. I showed up and posted a chart of the Fibonacci cluster on the Daily Chart of the USDCAD to my members at SecretFXTrading and followers on twitter.

So the 38% of the late July 26th of 0.9405 to the October 4th high of 1.0667 comes in around 1.0179. Also the 38% of the same October 4th high 1.0667 to the October 28th low of 0.9894 comes in around 1.0184....but gosh that October 4th pin bar was such a beauty!!! Almost every major forex pair had a sharp reversal that day...only Cable the GBPUSD forex pair went lower to 1.5270 on October 6th when the Bank of England raised the 'Asset Purchase Facility' (APF) by 75 Billion to 275B....basically printing more money. More supply of paper, less value, however this was good news cloaked as bad because it will help the Economy, hopefully adding a few points to GDP, which would strengthen the Pound-Dollar...but perhaps it will raise inflation, which is a stealth tax...hmm good or bad or a bit of both....grey area, well you can shout, you can scream, but what offering solutions, we can all click a mouse button and place a trade, don't be too drastic, remember social cohesion, the status quo, don't want to rock the boat too much. Wow I got way off topic! Back the Loonie.

Anyhow the CAD GDP was basically flat, and all day the USDCAD pair bounced off this fib cluster. Generally I take 15-20 pips on either a half or a third of the position and move the stop to breakeven. Sometimes I stack entries and build a position up. There was a possibility that the 1st blue October fib level would break and the yellow july-early october fib would be tested which it nearly did but was front-run by a pip or two. Also notice how when the previous swing high was tagged the loonie would reverse back down into the fib cluster zone again for another go. Well how many times can you make 15-20 pips on half a position? After awhile you have racked up quite a few pips...of course it is easy to get greedy, hold the full position for a further move higher, just to get stopped out, give up your patience and leave the charts to start Christmas celebrations. Anyhow it turned out to be a good day and an extra nice bottle of champagne is in order. Here is the 5 minute chart of the fibonacci cluster zone mentioned above, with a summary of entries and exits, most exits were only half the position and the other half got stopped out, just to reenter...so did pay more spread than needed if the position had some more wiggle room but better safe than sorry, if the stop was 10-20 pips below there may have been a reason to hit it...remember the market wants to do business, even on Christmas.

Merry Christmas, Happy Hanukkkah or Happy Holiday

Magister Pips

Canadian GDP - slightly lower MoM Flat YoY comes with a bunch of US Data

Today December 23rd 2011 the GDP figures from Canada were released and the month-on-month figures was down -0.1 but the yearly figure was as expected. There was also Durable goods, PCE Core, Personal Spending and Income from the USA... market is quiet as Christmas approaches
The Headline Durable goods was up but this economic indicator can be very unpredictable, the core was slightly down as was the Personal Spending and Income

Here the figures:

Canadian GDP MoM
Estimages: Median +0.1%, Average +0.1%, Range -0.1% to +0.2%
Actual: +0.1% Prior: +0.2% No Revision
Canadian GDP YoY
Estimates: Median +2.7%, Average +2.7%, Range +2.6% to +2.9%
Actual: +2.7% Prior: +3.0% No Revision
US Durables ex Transporation
Estimates: Median +0.4%, Average +0.4%, Range -0.5% to +1.5%
Actual: +0.3% Prior: +0.7% Revised: +1.5%
US Durable Goods Orders
Estimates: Median +2.2% , Average +2.6%, Range -2.0% to +7.0%
Actual: +3.8% Prior: -0.7% Revised: 0.0%
US Cap Goods Orders Nondef Ex Air
Estimates: Median +1.0% , Average +1.1%, Range +0.4% to +2.0%
Actual: -1.2% Prior: -1.8% Revised: -0.9%
US Cap Goods Ship Nondef Air
Actual -1.0% Prior: -1.1% Revised: -0.8%
US Personal Income
Estimates: Median +0.2%, Average +0.2% , Range 0.0% to +0.4%
Actual: +0.1% Prior +0.4% No Revisions
US Personal Spending
Estimates: Median +0.3% , Average +0.3% , Range +0.2% to +0.6%
Actual: +0.1% Prior: +0.1% No Revisions
US PCE Deflator (YoY)
Estimates: Median +2.7% , Average +2.7% , Range +2.6% to +3.0%
Actual: +2.5% Prior: +2.7% No Revisions
PCE Core (MoM)
Estimates: Median +0.1% Average +0.1%, Range 0.0% to +0.2%
Actual: +0.1% Prior: +0.1% No Revisions
PCE Core (YoY)
Estimates: Median +1.7% Average +1.7%, Range +1.6% to +1.8%
Actual: +1.7% Prior:+1.7% No Revisions

Here some charts:

First USDCAD 30 second chart:

and the 30 second chart of CADJPy

the 30 second chart of the USDJPy to see the affect of the US data:

and the EMinis S&P 500 future 1 minute chart:

Canadian Retail Sales - Better Print leads to some CAD strength

This figure has not had any big deviation since May, there have been small deviations of +/-0.1 or +/-0.2 which cause quick 10-20 pip blips which quickly reversed.

Today the Risk-Off trade returned after the ECB bond auction which initially caused a move higher on risky assets but was sold into...EURUSD popped from 1.3150 to 1.3200 and then sold off all the
way to 1.3030. This was basically a buy the rumor, sell the news as the bond auction was expected to be good.

Anyhow the USDCAD followed the move down in EURUSD and risky assets by rallying from 1.0200 to 1.0300, which it tagged right before the news. The deviations were moderate and below what we would normally be interested in but as 1.0300 was a key level there was a nice move of about 30-35 pips off this level with the good canadian news. Here the figures:

Canadian Retail Sales Less Autos MoM (Core)
Estimates: Median +0.2%, Average +0.2%, Range -0.3% to +0.5% (majority:0.2 to 0.3)
Actual: +0.7% Prior: +0.5% Revised +0.4%
Canadian Retail Sales MoM
Estimates: Median 0.5%, Average +0.5%, Range 0.0% to +0.9% range (majority 0.3-0.7)
Actual: +1.0% Prior: +1.0% No Revision

Here is the 10 second chart of USDCAD:

and here is the 30 second chart which shows move or the move:

Canadian CPI - Nearly completely flat

The CPI (Consumer Price Inflation) figures for Canada came out this morning at 12 noon GMT, or
7am EST. They were mostly flat with the exception of the Core y/y coming in slightly lower.

Here the figures:

Canadian Core CPI m/m
Estimates: Median +0.1% expected, Avg +0.1%, Range -0.3% to +0.3% (most 0.0 to +0.3)
Actual: +0.1% Prior: +0.3%
Canadian Core CPI y/y
Estimates: Median +2.2% expected, Avg 2.2%, Range +1.8% to +2.4% (most +2.1 to +2.3)
Actual: 2.1% Prior: +2.1%
Canadian CPI m/m
Estimates: Median +0.1%, Average +0.1% prior, Range -0.2% to +0.2% (most 0.0 to +0.2)
Actual: +0.1% Prior: +2.1%
Canadian CPI y/y
Estimages: Median +2.9%, Average +2.9%, Range +2.6% to +3.0% (most +2.8 to +3.0)
Actual: 2.9% Prior: 2.9%

Here is the chart of the USDCAD 5 seconds:

CAD Ivey PMI higher

Canadian Ivey PMI comes out at 59.9 versus 54.4 expected and USDCAD moves further down in Canadian Dollar strength after the strength initially caused by the BOC Statement at the Interest Rate Decision. Basically killing all expectations of a cut early in 2012. With GDP at 3.5% and CPI at 2.9% this PMI readings shows despite the global slowdown Canada at least is not doing so badly.

Canadian Interest Rates Decision - No hint of rate cut ahead

Some analysts were expecting some signal from the Bank of Canada's Carney to cut rates sometime in the new year. These rumors were squashed during today's announcment.

Instead they said that:

European recession to be deeper than thought
2nd half of 2011 slightly stronger than anticipated
Inflation slightly firmer than expect; to ease going forward
Additional measures will be needed to contain European crisis

USDCAD sold off from 1.0200 to 1.0120 quickly as the New York cash equity indices opened and the CAD Ivey PMI was released.

Canadian Retail Sales After-spike Scalping with the FX Futures Contract

This past Friday January 21st 2011, the Retail Sales figures out of Canada were release, these were generally expected to be higher after the Bank of Canada said in there last that household spending had unexpectedly increase, this was opposed to their statement in October which was that it was likely to reduce. Here are the figures:

CANADA NOV RETAIL SALES M/M: 1.3% V 0.5%E; RETAIL SALES LESS AUTOS M/M: 1.0% V 0.5%E
- Prior Retail Sales MoM revised higher from 0.8% to 1.0%

A good deviation on the headline number, but really was looking for more of a deviation on the Core figure on this one. Spike traders were focusing on the Core number primarily for a spike trade, however both did numbers did come out higher than expected, so it was a good reason to buy Canadian Dollars, and there was actually alot more pips to be made on the follow thru.

The attached chart show the 2 trades taken, remember the Canadian Dollar Futures moves opposite to the direction of the USDCAD forex pair, so basically you are trading CADUSD. This chart is a good example of what can happen with economic news trading, sometimes the 1st pullback doesn't give you the continuation, so either you are patient or take some profit when you see the trade rolling back over. You can always reenter a trade so I perfer to do this rather than wait for it go back in the profitable direction.

Canadian GDP - Nice Spike but little retracement

This Tuesday afternoon at 1:30pm GMT (8:30am EST) the GDP figure for Canada were released. This data often comes out with other data from the USA such as US GDP and Core PCE, as this is a common release time. Luckily this month it came out on its own which is very fortunate because this release is basically wasted when it comes out with another good report like US GDP and traders don't know which news to trade. Of course the afterspike trade is always there, but in terms of spike trading it is quite risky to do when there is another report which can effect the price besides the main report the trader is focusing on.

Looking back thru the previous releases of this number, it does not deviate much and if it does only by +/- 0.1, however back in March of this year there was a +0.2 and in October 2009 there was a -0.2 deviation. The price of the CAD pair did move very well on these releases. There is also an Annualized Quarterly figure which is released with the main monthly one, this is not as important but it helps if it deviations in the same direction as the main monthly number. Here is the Data:

CANADA SEPT GROSS DOMESTIC PRODUCT M/M: -0.1% V +0.1%E; Q3 GDP ANNUALIZED: 1.0% V 1.5%E- Prior GDP Annualized revised from 2.0% to 2.3%

The news release gave a nice spike trade for about 30-40 pips. There was little retracement in the minutes directly after the news, so no afterspike opportunity. Later in the session some retracements were hit, but other news out of the USA like Chicago PMI and Consumer Confidence were released and the entry of the US traders provided some relief to the US Dollar strengthening trend which had been strong thru-out the european session. Some 2 hours after the release for instance, a bounce off the 61% of the news spike reaction move did provide a bounce from 1.0250 to 1.0280, but it could not maintain momentum. USDCAD has been consolidating between 1.0100 to 1.0250 so todays price action witnessed during the news is an attempt to break-out to the upside. USDCAD did finally test parity some weeks ago, catching up with other pairs like the USDCHF, but now that Risk Aversion is back the USDCAD has held onto some of it's earlier gains. This could have something to do with the announcement that Russia would move some of its reserves into Canadian Dollars and because Canada has tight coupling with the USA.

Canadian CPI - Big Deviation Spike but Reversal

The Consumer Price Index, the major gauge of inflation was released out of Canada this Tuesday Nov. 23rd at noon GMT (7am EST). This has been a great report to trade a few years ago but recently it will only cause a short-lived spike. However this month there were quite signicant deviation on all 4 of the main numbers that come out with this report. There are yearly and monthly figures for both a Core Number, which excludes volatile items like energy and food, and a Headline number. Here is the Data:

CANADA OCT CPI CORE M/M: 0.4% V 0.1%E; Y/Y: 1.8% V 1.5%E - No revisions
CANADA OCT CONSUMER PRICE INDEX M/M: 0.4% V 0.2%E; Y/Y: 2.4% V 2.2%E - No revisions

As the 1st chart shows the USDCAD did spike down from near 1.0190 to 1.0165, so there was money to be made trading the spike using the Secret News Weapon, and members in the Profitmonger Live Online Forex Traderoom made money trading it. Price bounced quickly back up to the 61% within the 1st 30 seconds after the news release at around 1.0185 and moved back to below the 38% of the same fib move at around 1.0170 for a quick +15 pip afterspike move. Price did not continue down however and came back to the same 61% level at 1.0185 and held there for over 5 minutes, definately not a good sign. Traders were aware that there was alot of risk aversion in the markets as not only was the situation with EuroZone peripheral debt issues causing this but also there were some shot fired near the border between North and South Korea and alot of tough talk. In risk aversion situations the USD can strengthen as it is a safe haven currency, because it is the biggest most liquid market it can absorb all those in risky assets who want to get home fast.

....So to judge the performance of this CPI release based on what happened to the USDCAD pair is not right, so also included is the 1 minute chart of the EURCAD. As we can see on this chart, this news performed exceptionally well for the afterspike. After about 10 minutes of the release price retraced to the 50% of the previous swing, which included the news spike move, as price was moving down already heading into the release. From this 1.3808 level prices moved down all day as the situation in the EuroZone grew worse as various Euro ministers said things which weakened confidence in the single pair, including Angela Merkel. In fact the trade could have been held for the next day as well as it reached a total of +350 pips.

Canadian Retail Sales and US GDP - alot of data but no good deviations

This Tuesday at the main time slot for North American news 8:30am EST (1:30pm GMT) alot of data came out of both the USA and Canada. Just 1 and a half hours early Canada had released its CPI figures and now it was releasing its Retail Sales. Also the USA was releasing its GDP figures. Both numbers had potential to cause nice moves in the Forex and Futures markets, but it is kind of a waste to release them all at once as a deviation in the US number can affect the US Dollar and effect the price of USDCAD which is responding to the Canadian data. We can try to mute this somewhat by trading EURCAD or CADJPY but still these pairs will react to any move in the USD and it is the main pair which is involved in the majority of transactions in forex. Anyway here is the Data:

CANADA SEPT RETAIL SALES M/M: 0.6% V 0.7%E; RETAIL SALES LESS AUTOS M/M: 0.4% V 0.3%E
- Prior Retail Sales MoM revised higher from 0.5% to 0.7%.
- Prior Ex Autos MoM revised higher from 0.4% to 0.6%.

(US) Q3 PRELIMINARY GDP Q/Q ANNUALIZED: 2.5% V 2.4%E; PERSONAL CONSUMPTION: 2.8% V 2.5%E

(US) Q3 PRELIMINARY GDP PRICE INDEX: 2.3% V 2.3%E; CORE PCE Q/Q: 0.8% V 0.8%E

Not a significant deviation in any of these numbers to get interested in this. The Canadian Data was actually mixed with headline -0.1 and core +0.1, these sorts of conflicts are what traders want to avoid and why its best to use a larger deviation so chances are both figures will agree. Included is a 10 second chart of the USDCAD which shows how price blipped up 10 pips and then turned around back down 20 pips....nothing here.

Also be sure to check out Doug Ragan blog entry for Trading the US GDP with the EMini S&P 500 Futures Contract

Canadian Employment - just missed deviation and mixed

Canadian Employment data just hit the wires about 10 minutes ago. This report consists of 2 numbers: the Employment Change number and the Unemployment Rate. A higher Employment change number is good for the Canadian Dollar or loonie and will tend to send the USDCAD down, while a higher Unemployment Rate is bad and will send the USDCAD up. This time the Employment Change number was lower with a -12 dev and so was the Unemployment rate at -0.1, so in this case the data conflicted, with the change figure bad for the loonie and bullish for USDCAD and the rate number good for the CAD and bearish for USDCAD. Initially the price of USDCAD did move higher, following the lower employment change, but it didn't continue or even maintain the new high achieved. Price came right back down quite quickly and then whipsawed around. Also the breakdown of part-time versus full-time jobs is now being reported. Here are the numbers:

*(CA) CANADA OCT NET CHANGE IN EMPLOYMENT: 3.0K V 15.0KE; UNEMPLOYMENT RATE: 7.9% V 8.0%E
- No revisions

Breakdown of Jobs report:
- Full-time jobs: 47K v 37.1K prior
- Part-time jobs: -44.2K v -43.7K prior

The USDCAD did move up heading into the report, but this was unlikely to have been a move induced by a rumor or leak of the number, rather just that in general the USD was retracing some of the losses it took in the aftermath of the FOMC announcement on wednesday. The EURUSD took the biggest hit as the market focused on widening peripheral bond spreads, which had been an issue all week, but now that the US elections and the FOMC with QE2 is out of the way, the market could focus on it.

Included are 2 charts, first chart is a 1 minute chart of the USDCAD, which shows some of the run-up of the pair into the report. The second chart is the December Canadian Dollar Futures Contract which goes by the name of 6C on Ninjatrader (I have found different platforms have different symbols). This chart shows the 1 second price action. Remember the 6C trades in the opposite direction to the USDCAD...ie stronger Canadian Dollar means up.