Ah, yes...the quintessential "what the news means" market...
To those of you speculating on North Korea...the dollar strength against the YEN DID start at the beginning of the speculation.
NFP number speculators - the revision was big...on CNBC this morning, they were talking about how the revision will have a larger impact because now there will be some doubt as to the viability of the released numbers. 51K could very well be revised upwards as well...plus, a lot of you alluded to it that 51K + ~60K was about 111K...The real pricing affect has to do with whether or not the feds were going to actually cut interest rates in october. The strength of the AUGUST numbers, despite showing a substantial decrease in September, means that the fed will probably NOT cut interest rates in October. This is my guess as to where the "strength" is coming from. In other words, the fed gets to remain a little hawkish a bit longer.
This is purely my speculation on the matter.
As for trades...I was sooo ready to push that BUY the GBP/USD button but as I was waiting for the news trade service to spit the numbers, I saw 20 pip spike, which made me hesitate when the numbers were actually spewed. When I heard the upwards revision number (and the guy talked REALLY fast), I literally froze thinking to myself: what the hell do I do with that??? Literally in that second as it hovered right at the 1.8875 mark, the price started coming down, so I realized that buying was probably not going to be an option. 20 seconds later, we were at equilibrium and hovering. My initial thought was that we were going to stay there as, for me, the numbers kind of nullified each other. Then the price moved towards the magic 00 at 1.8800. So I got ready my SELL button. Right as it broke 1.8800, I pushed the SELL button and immediately got requoted...Thinking that was cosmic Karma, I packed it in feeling VERY fortunate that I didn't push the BUY button when the price moved and WAITED to actually HEAR the numbers. I could have easily been whipped on this one.
In retro-spect, I wish I could have analyzed the numbers more quickly. Unfortunately with a huge upwards revision and a big miss on the estimate to the downside, I couldn't help but feel too neutral on the trade...which probably should have led me to not even waste my time waiting for the push below 1.8800...but I figured if there was going to be movement, the momentum was down...so I figured I'd try to catch the break.
So, lessons learned:
- the audio news was no faster than sirius CNBC...they were literally talking at the same time. What I did like was that audio news guy was giving a countdown. (about 5 minutes left, folks...we're 20 seconds away...etc)
- the headline stream was actually 10 seconds faster than the guy could talk as the stream posted the numbers and revision WHILE the guy was still reading the initial sentence.
- It's better to have a positive revision AND inline estimates - or - a downwards revision and strike below estimates for a more confident trade
Do I regret not being in? sure...but i just as easily could have gone the other way.
To those of you speculating on North Korea...the dollar strength against the YEN DID start at the beginning of the speculation.
NFP number speculators - the revision was big...on CNBC this morning, they were talking about how the revision will have a larger impact because now there will be some doubt as to the viability of the released numbers. 51K could very well be revised upwards as well...plus, a lot of you alluded to it that 51K + ~60K was about 111K...The real pricing affect has to do with whether or not the feds were going to actually cut interest rates in october. The strength of the AUGUST numbers, despite showing a substantial decrease in September, means that the fed will probably NOT cut interest rates in October. This is my guess as to where the "strength" is coming from. In other words, the fed gets to remain a little hawkish a bit longer.
This is purely my speculation on the matter.
As for trades...I was sooo ready to push that BUY the GBP/USD button but as I was waiting for the news trade service to spit the numbers, I saw 20 pip spike, which made me hesitate when the numbers were actually spewed. When I heard the upwards revision number (and the guy talked REALLY fast), I literally froze thinking to myself: what the hell do I do with that??? Literally in that second as it hovered right at the 1.8875 mark, the price started coming down, so I realized that buying was probably not going to be an option. 20 seconds later, we were at equilibrium and hovering. My initial thought was that we were going to stay there as, for me, the numbers kind of nullified each other. Then the price moved towards the magic 00 at 1.8800. So I got ready my SELL button. Right as it broke 1.8800, I pushed the SELL button and immediately got requoted...Thinking that was cosmic Karma, I packed it in feeling VERY fortunate that I didn't push the BUY button when the price moved and WAITED to actually HEAR the numbers. I could have easily been whipped on this one.
In retro-spect, I wish I could have analyzed the numbers more quickly. Unfortunately with a huge upwards revision and a big miss on the estimate to the downside, I couldn't help but feel too neutral on the trade...which probably should have led me to not even waste my time waiting for the push below 1.8800...but I figured if there was going to be movement, the momentum was down...so I figured I'd try to catch the break.
So, lessons learned:
- the audio news was no faster than sirius CNBC...they were literally talking at the same time. What I did like was that audio news guy was giving a countdown. (about 5 minutes left, folks...we're 20 seconds away...etc)
- the headline stream was actually 10 seconds faster than the guy could talk as the stream posted the numbers and revision WHILE the guy was still reading the initial sentence.
- It's better to have a positive revision AND inline estimates - or - a downwards revision and strike below estimates for a more confident trade
Do I regret not being in? sure...but i just as easily could have gone the other way.