Last week was a very volatile week. EURUSD dropped from 1.059 to 1.044 and then back to 1.059 on Friday. Nonfarm payrolls for September give a very big surprise to the market. We have to be more cautious in this coming Monday and the CPI announcement for this week.
The consensus for Nonfarm payrolls (NFP) is 170K but the result was 336K, almost double of its consensus. The stock market and forex market give an even bigger surprise as both markets were having a big rally yesterday. The US Fed Chairman, Powell has stated previously that they would like to see the NFP drop to around 100K, but now the job market has turned out to be so hot. By right, this means the Fed has more reason to have more rate hikes, but the market was having a big rally as they were thinking the economy soft landing is possible now.
Hence, for Monday, we recommend monitoring the market before you start trading especially if you are planning to trade in the buy direction. We are concerned that the NFP effect will only reflect in the market on Monday but we could be wrong too.
This week, we have a few important economic announcements from the US too.
- 11 Oct (Wed) – Producer Price Index (PPI)
- 12 Oct (Thu) – FOMC Meeting Minutes, Consumer Price Index (CPI)
The consensus for CPI YoY is 3.6%. The previous CPI was 3.7%. If the CPI came out higher than expected, it means the probability for further rate hikes is possible, pushing the USD to be stronger.
Recommendation
With this outlook, to be on the safe side, we strongly recommend all Ophiuchus and Limitless EA users to schedule to stop trading for this period starting from 10 Oct till 13 Oct. You can use the stop trading period feature in the EA to do that. You can also decide to start the stop trading for a longer period to wait for the dust to settle. (e.g., stop trading from 10 Oct and only start trading after the Monday) if you would like.
We understand that you might feel that it is more frequent to receive market update recently and more intervention is required to control the EA. We are working on a new feature to manage the stop trading period for EA automatically based on upcoming annoucements. Based on our current estimate, the new feature will probably release either end of the year or early next year. Please stay tune for this new feature.
Disclaimer – Please note that Limitless Trading is not liable for our recommendation and is not responsible for any loss or profit caused by this recommendation. You should assess your personal circumstances and perform your own research to make decisions for your trading.