There are two trades that offer the potential for some profit.

3:00 PM EST

NZD Official Cash Rate – Interest rate at which banks lend to other banks.

NZD/USD

Note:  Watch out for a spike before the OT gets the data.  If you see this, turn off the OT immediately.

The rate is currently 3% and is not expected to change.  It appears economists are largely in agreement on this.  I will set up the Oracle Trader with a .25 safe trigger and trade full lots.  If it hits the trigger, we should see at least a 70 pip spike.  I will also trade the Straddle but will be quick to exit in the likely event it comes out as expected.  If the pair is jumpy before the release, you could move your buypips and sellpips up to 6 or 7 to reduce the odds of getting taken in prematurely.

7:30 PM EST

AUD Employment Change – Change in the number of employed people during the previous month

AUD/USD

Note:  Watch out for a spike before the OT gets the data.  If you see this, turn off the OT immediately.

This can be a great trade and is really the best opportunity for profits this week.  Both row 1 and row 2 matter.  A look back tells us that in September, it came out at -5.9 and .1 (below our triggers) with a spike of 17 pips.  Nice spike for such low numbers.  In October, it came out at 29.5 and 0, with a spike of 40 pips.  I also tried the AUD/CAD on this one but barely broke even on that pair so this was not a good idea.  Otherwise it was a good trade and the AUD/USD did very well.  In November, however, we had some craziness.  The data came out at 9.7 and .4.  The .4 was the opposite direction of the 9.7.  There was a spike up of 40 pips 5 seconds before the news was due out.  The row 1 data came out as a buy but it didn’t really move up any more because it already moved far enough.  Then row 2 came out as a huge sell.  .4 on row 2 is enormous.  There was a large spike down due to this. I turned off the OT and the Straddle when I saw the 40 pip spike come out so far in advance of the scheduled news time.  The Straddle had not entered the stop orders at that time.  Clearly there was a leak or some anticipation of direction.  This is a risk with these AUD and NZD trades.

I will use 15 medium and 20 safe on row 1, and .2 medium and .3 safe on row 2 on the Oracle Trader for this one.  Will trade 1/2 lots for the medium and 3/4 lots for the safe.  Watch out for premature movement and be prepared to click out.  Also will use the Straddle with a maxspread of 6, and buypips and sellpips at 6 also.  Spikes before the news are OK for the Straddle as long as they happen AFTER your 2 stop orders show up, which you should try to make happen about 3 seconds before the scheduled time of the release.

Dustin does not trade the AUD releases in the trade room primarily because of what happened last month.  These have an extra element of risk because of the increased likelihood of this.  However, last week we did real well on the 2 AUD releases.  Lots of money can be made if you are aware of what might happen.  The occasional craziness does not bother me.  In fact it makes for good post-trade conversation (admittedly small consolation if you lose).

Good luck!