For all the talk about recovery and supposedly expanding economy NFP delivered a shock to the system today. Unemployment rate is officially above 10%, at 10.2% to be exact. It is the highest rate since 1983, with nearly 16 million people looking for job, and the number is likely to grow even higher. Counting those who have settled for part-time jobs or stopped looking for work, the unemployment rate would be 17.5 percent, the highest on records dating from 1994. People who insist that recession is over coined a phrase “jobless recovery”, trying to validate their opinions.

To put it in another perspective -October was the 22nd straight month the U.S. economy has shed jobs, the longest on records dating back 70 years. This is even longer than during the recession in early 80’s, when unemployment reached 10.8%, postwar record. When that down turn started in July 1981, official unemployment rate stood at 7.2%, compared to 4.9% at the beginning of current slump. Lesson is very simple- during this recession economy has been shedding jobs at much faster, steeper pace. Number of people officially out of work for a period of 6 months or more set a record at 5.6 million. But the recession is over, right?

After a range bound Thursday, I expected some directional moves once Europe opened for business. Well, not much of anything happened. Later on with NFP, which I don’t trade, approaching, I tried to look at some pairs less likely to be effected by the announcement. Normally I wouldn’t worry about it, but this time around it was clear that markets were waiting for it, quiet as it was. So I looked at Canadian Dollar, which, after few days of strength, had built decent reversal patterns yesterday.

Most CAD crosses had similar set up to the one here in GBP-CAD. Buy order was placed at 1.7711, with a target of 1.7850. Price moved nicely and almost reached the objective. Then NFP hit the wires and had some effect even on this pair. I got out at 1.7764, probably an overreaction, but it is done. All said, anticlimactic day.

Remaining orders that were featured on these pages during last few days are still valid. Of the top of my head this includes a sell in NZD-JPY on hourly charts and a sell in EUR-GBP using intermediate, 4H charts. There are still few hours left in trading day, and currencies have gotten a little more active, so maybe one of these orders will be filled. Stepping outside of Forex- gold reached $1100 for the first. Does it mean it is time for a correction?

Mike K.