London Session Recap – June 6, 2014

  • German Industrial Production m/m: 0.2% vs. 0.4% forecast, -0.6% previous
  • German Trade Balance: 17.4B EUR vs. 15.1B EUR forecast, 16.6B EUR previous
  • Swiss Industrial Production y/y: 0.5% vs. 0.3% previous; CPI m/m 0.3% vs. 0.2% forecast, 0.1% previous
  • U.K. Trade Balance: -9.62B GBP vs. -8.65B GBP forecast, -8.29B GBP previous

After a pretty quiet Asian session, forex traders went back into euro sell mode after shaking off ECB rate cuts in the Thursday session. Despite some mostly positive German economic data, it may be sinking in that negative deposit rates and the new LTRO program will soon be live for the European economy.  The euro was taken lower as soon as the London session open, but has bounced nicely mid-day to limit the sessions losses:

EUR/USD is down 20 pips (-0.15%) to 1.3638, EUR/JPY is down 24 pips (-0.17%) to 139.62, and EUR/GBP is down 13 pips (-0.16%) to .8105

It’s once again that time of the month where we’ve got a slew of major, major economic news from North America, most notably: employment data.

At 1:30 pm GMT, we’ll get the monster U.S. Non-Farm Payrolls report, which has expectations of a net add of 215K jobs vs. 288K previous, and the unemployment rate ticking higher from 6.3% to 6.4%.  This data has been on the upside over the last few months, so a downside read will most likely have a bigger reaction than a positive one.  The labor participation rate is also an important data point to watch as it measures those who are able to work, but choose not to look for a job, which in conjunction with the unemployment rate is a more accurate picture of the U.S. employment situation.

At the same time as U.S. jobs numbers is the release of the Canadian jobs report. While not as big a market mover the NFP report is, this data point can easily push the Loonie up and down, especially in the cross pairs like CAD/JPY, EUR/CAD and AUD/CAD. The expectation is for a net add of 25K jobs vs. -28.9K previous and the unemployment rate to come in with the previous read of 6.9%.

And to close out the week, we’ll get the U.S. consumer credit number at 8:00 pm GMT. This is a second tier event with expectations to tick lower to $15B vs. $17.53B previous, so it has a chance to provide one last spark in volatility if we see big surprise.

See also:

Asia Session Recap

U.S. Session Recap

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