Nonfarm payrolls price action disappoints

Nonfarm payrolls data failed to create significant price action moves in most currency pairs. In fact, Friday was very calm in Forex market. Only scalpers could have benefited from the event. Other than that it was a pretty boring day. It is quite unusual for Fridays that often have huge market swings in most currency pairs and sharp reversals after weekly moves. 

However, it does not mean the piece of news will not have impact at all. Reactions often come after a day or in the beginning of a new week. The data that came out was slightly below market expectations, but it was still quite good. So, we have yet to see how big market dogs decide to push various currency pairs on Monday. 

I keep to my position that Euro will collapse soon and I think the move down has already started. Important support level has been broken. We do need some announcement from ECB or FED for the fall to accelerate and I guess it should come this month. It could be done during the announcement when interest rates are announced. I think it will be ECB head who will make a bearish stance against Euro.

Let us wait and see what happens this week. See you soon.

Logics versus price action in fx trading

A lot of folks are searching for logics when they study fundamentals in Forex or any other financial market. And they fail. Fundamental news and price action rarely have common logics. You might have the most promising data and the market will still continue to fall and vice versa, you can have the most disappointing data and the market will continue rising. What to do in these kind of situations? You stop following your logics and try to understand market logics. 

Well, there isn’t much logics in that expect that markets run on expectations. That’s it! And do not try to think otherwise, because you will fail. You’d better change your mentality and try to understand where the market is headed by trying to figure out market expectations. I have been disappointed a lot of times seeing how market fundamentals and directions do not add up. There is a good article on the topic by Kathleen Brooks on trade2win website. Read it to expand your knowledge on the subject. Here is the article. 

Ok, there are just a few days left till 2013. I will write at least one post before the event. Happy Christmas season. Do not overtrade while waiting for the best opportunities.