Can someone tell me why after the jobs report came out why the dollar would lose value. My thinking was that if the dollar printed a good jobs number the dollar would gain against other curr. I trade GBP/USD and looked for the gbp to lose. Whay happened!
A good jobs report mean little. Could just mean people stopped collecting unemployment but not that they actually got a job. Big drop in NFP would suggest job were lost and not actually created.
What you didnt think Obama would be honest and not cook the books on his last jobs report till the elections did you?
I only had a very brief look online today but check the BabyPips Economic Calendar; did the US not post other data that came in worse than expected?
I might be wrong though but it rings a bell for some reason & at a guess, this info out weighed your job info.
In a nutshell, good news for the US economy means investors move out of cash, and back into other investments. Less cash is needed, dollar goes down.
Bad news for the US economy means moves back into liquidity, the demand for dollars rise, dollar goes up.
But keep in mind, that’s a cyclical situation.
If the US government were to come to a solid meeting of the minds, and the debt problem was suddenly solved, the good news for the US economy would push up both equities, AND the dollar. The dollar would again be the go to haven, and a lot of foreign money would move into the safe investment. (much like the Aussie has experienced the last few years)`
absolutly fellas, good job.
This is why i said in my News thread, Crazy how everyone is jumping for joy at the Dow Opening, the USD is tanking at he same time, which I knew it would, so no surprise to me…
Follow the Dow, the EU follows, well, in most cases, lol…
Thank you for your answer.
Pardon me for asking but I seek further clarification to your explanation.
You stated that when US economic data is good then the greenback depreciates in value
The greenback is sold as investors move into other positions like equities.
But the you make a contrarary conclusion…
"
If the US government were to come to a solid meeting of the minds, and the debt problem was suddenly solved, the good news for the US economy would push up both equities, AND the dollar. The dollar would again be the go to haven, and a lot of foreign money would move into the safe investment.
"
If the US solves their debt problem and the US economy gets an upgrade wouldn’t the greenback loses value as people sells the dollar
and move into equities.
It’s not about how good or bad it was.
It’s about whether it’s better or worse than the market has already taken into account in advance of the news. And that’s not something you can safely predict without a professional research department at your disposal.
When it comes to trading the news, as a small, retail forex trader, you can’t possibly compete with the bigger, better traders in the market and win. It’s fraught with dangers. They’re better equipped than you are. They have research departments. They have a speed advantage. Everything is stacked against you.
And on top of all that, there are so often spikes in both directions that it’s easy to get the overall direction right and still lose money.
Trading fundamentals/announcements, unless you’re a highly experienced specialist with specific knowledge not known to most other major market participants, is not a good way forward for any of us.
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