On Wednesday 04-01-09 at 8:15 AM ET, the USD ADP Non-Farm Employment Change report will be released for the month of February.
The ADP report leads the U.S. Government Employment Change report by 2 days, which is due Friday 04-03-09 at 8:30AM ET.
The previous USD ADP report came out on Wednesday 03-04-09 at 8:15 AM ET.
The USD ADP report released in March, for the month of February, was set up as follows:
Previous Report: -522K – revised a few minutes later to -614K
Economists Forecast: -620K – did not look like an improvement.
The actual report: -697K – a difference of -77K, not very healthy for the US economy
The last 5 USD ADP “previous” reports have been “revised” just a few minutes after the actual report release, March not being the exception.
The “revisions” could have an effect on the currency market – but I have not seen it yet.
I monitored 4 currency pairs during the March USD ADP report and here is what happened:
EUR/USD – moved down about 20 PIPS in 5 minutes- wrong direction
moved up about 38 PIPS in 13 minutes- right direction
GBP/USD – moved down about 25 PIPS in 14 minutes- wrong direction
moved up about 40 PIPS in 13 minutes- right direction
USD/CAD – moved up about 30 PIPS in 9 minutes- wrong direction
moved down about 80 PIPS in 44 minutes- right direction
USD/JPY – moved up/down for 12 minutes
moved up about 20 PIPS in 22 minutes- wrong direction
The USD ADP Non-Farm Employment Change for this month’s release ( a report on March Employment change) has a “forecast” of -660K, a decrease in the number of employed persons to -660K, a loss of almost 37K jobs.
If the “actual” USD ADP report comes out less or more than the “forecast” by a large amount, say 50K or more, this would be a huge surprise for FOREX traders and the market may move considerably in the following minutes of the report.
So, let’s set this up:
The March previous= -697K
The economists forecast= -660K
If the “actual” report comes out -710K or more, this will be real bad for the USD, and a big surprise for traders. The USD/CAD currency pair could shoot down.
However, if the “actual” report comes out at -610K or less, this would be good for the USD and again, a big surprise for traders. The USD/CAD currency pair could shoot up.
The March USD ADP report had enough of a difference from the forecast to move the FOREX market in the right direction as you can see in the results above – USD/CAD moved the best, but we had to wait for the market to decide which way to go.
The probabilities set forth above are assuming no unpredictable events are taking place at the same time.
Speeches on the economy by government officials, or a situation somewhere in the world that could have an impact on the U.S. economy – could adversely affect the market.
Sometime after the end of the USD ADP report I will post a results. So, check back!
Wednesday 04-01-09:
Here are the results of USD ADP Non-Farm Employment Change report:
Looks like more people lost their jobs last month, 36,000 from the “revised” February report of -706K. This report is very bad for the USD!
Here is how it affected the 4 currency pairs I follow:
EUR/USD – moved down about 14 PIPS in 2 minutes – wrong direction
then moved up about 45 PIPS in 55 minutes – right direction
GBP/USD - moved down about 13 PIPS 1st minute – wrong direction
then moved up about 25 PIPS in 8 minutes – right direction
moved down about 47 PIPS in 65 minutes – wrong direction
USD/CAD – moved up about 19 PIPS in 3 minutes – wrong direction
then moved down about 37 PIPS in 20 minutes – right direction
USD/JPY – moved down about 20 PIPS 1st minute – right direction
then moved up about 20 PIPS in 14 minutes – wrong direction
moved down about 38 PIPS in 32 minutes – right direction
Looks like only 3 of the currency pairs traded in the right direction eventually, so, if you were patient in the first few minutes of the market, and entered a trade with either of the 3 currency pairs which moved in the right direction with depth, you could have had a winning trade.
Looks like the EUR/USD currency pair was the best trade today.
