IIFT Daily Note with Peter Brown

Non Farm Payrolls day!

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There is a lot going on and September is set to continue volatile. However today is all about 1.30pm and the NFP release. We are expecting 180k. The predictions on how the equity market will react are tricky. Tapering is coming as the economic stats have been positive. If the figure is 200k or better there is a danger the market will sell off. However of late the market has rallied on good news. Take into account the ten year bond rate which is close to 3.00% and the picture is quite confusing. The bond market needs caution and I will blog that on Monday. Hitting 3% could cause forced selling which will put the market into turmoil.

The easy trade today is the dollar. Draghi’s comments yesterday on low inetrest rates and the Euro economy were very negative for the Euro. Add to that tapering and we could be seeing a macro sell off on the Euro. Down to 1.2750 area. So if we get a high figure dollar should roar. A low figure and the Euro will bounce. This is an easier trade  I feel and the one I am going to trade. Eur/USD or USD/JPY either is good.

Look for action at 200k or above  and 160k or below. In the middle could be the pub. Watch the ten year bond rate also that could be the trade from left field. CNBC will be all over it.

Levels today are EUR/USD  1.3150  1.3110 (big support)  S&P  1666 1658  support at 1648 1640 1630 1625 (major)

Good Luck and if the figure is good don’t be in a rush to cut a short Euro position. It may be a trade to carry for a few days.

 

One Comment

Lawrence

September 6, 2013

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Hey Peter,

Thanks for the trading plan last night and run through of trading blunders..

I think I am close to getting 3.5% average win ratio. See you guys on the trading days.

Lawrence