US Jobs report to be eyed today.

The first Friday of every month sees the market get the official US Non-Farm Payrolls Report which is essentially the US employment figures. Why is this economic data announcement viewed as so important? It is because the US Federal Reserve set a benchmark some years ago (post the GFC) that US job creation was going to be its gauge to when it would raise interest rates.

Currently the US has an unemployment rate of 6.1% however the participation rate has substantially fallen since the GFC and job creation per month is what the US Fed wants to see and an increase in the number of people looking for work. The market will be satisfied if the US jobs report today is over 215,000 as the market is expecting 215,000. A private ADP jobs report for September showed the US created 213,000 jobs and whilst this report is not accurate every month it’s generally a good gauge over the long term.

Last month the US created only 142,000 jobs and I think this figure has a good chance of being revised upward and if the September figures beats estimates of 215,000 and the August figure is revised up closer to 200,000 then the US Dollar is likely to rally strongly immediately after the figures are announced. It all happens at 10.30pm AEST today.

Go to www.ltggoldrock.com to learn more about LTG GoldRock's award-winning Trading Education & Coaching.

It’s official. The RBNZ was selling its own currency.

The RBNZ announced yesterday that in the month of August it was an active seller of its own currency to the tune of more than half a billion dollars and this was the largest intervention made by the RBNZ in 7 years. The Kiwi Dollar weakened on the news but what sent it 1 cent lower within an hour was when New Zealand Prime Minister John Key spoke to the press. Mr Key a former large currency trader himself said the following to the press on Monday.

"I happen to actually support the view that the Governor has that the exchange rate is overvalued, so if they have intervened, it would be a matter for them, but it would seem fairly logical, I think at the level we’re at, [US]78 odd cents, we’re still at very high levels. In the end, the Goldilocks rate, not too high, not too low, just about right, I don’t know, [US]65 cents maybe, certainly ... lower than it is today.  Just because I think that’s the rate that works for exporters doesn’t mean it’s the rate it’s going to get to."

The RBNZ sold in August $521 Million of its Kiwi Dollar holdings but what is interesting is the fact that in the month that it did sell its own currency the Kiwi Dollar only dropped by 2c. The following month of September the Kiwi Dollar has dropped 6c. The intervention and comments made by the RBNZ simply goes to show that if you want to trade against a Central Banks views and intentions then you are likely going to be on the losing side of the market more often than not.

They are jumping off the Aussie & Kiwi Dollars like a burning shipwreck.

The Aussie Dollar, Aussie Bonds and the Aussie share market has been offering investors solid returns for a number of years now. International investors who live in countries that have extremely low interest rates have been enjoying investing in Australia and New Zealand where they have been able to achieve higher returns on investment and do it relatively safely and securely. For example buying the AUD is a positive carry trade of 2.5% annually, buying 10 Year Australian Bonds delivers around 2.5% to 3.5% annually depending on the type of Bond you buy and many blue chip shares in both countries have been delivering similar or better dividends. Hence when international money comes into our financial markets to buy these products it not only helps support bond and stock markets it also helps support the AUD and NZD simply due to the fact you need to pay for your purchases in Aussie or Kiwi Dollars.

But recently we have seen the tell-tale signs that many of these investors are bailing out of Australia and New Zealand and the reason why is very simple. If you buy a bond, invest in Aussie or Kiwi Dollars or are relying on a dividend from the share market, the price you pay for that investment is important. If it falls in value beyond what your dividend is going to be annually you are losing money. And that is exactly what is happening to many international investors who have bought the AUD or NZD, Aussie or Kiwi Bonds and Aussie or Kiwi Shares.

Want to learn more about investing in the Australian Dollar? Register to attend the free weekly coaching from LTG GoldRock in their online Trading Room.

Get on with your day and leave your charts alone.

The message today simply is get on with your day. Get your Order Sheet trades updated and don't bother looking at your charts. Try it.

Today is just one of those days when there isn't much of anything going on that will get markets rocking. Unless someone says something unexpected and we can never predict that anyway.

I have had a sneaky look at my charts already and I will look again later this afternoon but between now and then I won't bother.  Unless there is a valid reason why you should, you shouldn't bother either.

Perhaps take a minute to go to www.ltggoldrock.com to read our latest Trader Success Stories... 

The man who predicted the GFC says the AUD is about to fall 20%.

His name is Roubini and he is respected amongst banks, institutions and economists alike for accurately warning and predicting the Global Financial Crisis. He's now saying the Aussie Dollar is about to fall by as much as 20% in value from its current levels. If he's correct that would put the AUD vs the USD at around 0.72c. It is difficult to argue against him as the AUD seems to have a number of factors conspiring against it which I have been reminding you about for close to 12 months.

US interest rates are likely to rise and Australian interest rates are likely to remain on hold or even fall further. The Aussie economy has a lot of genuine question marks against it however other than interest rate differentials the bulls holding long AUD positions have one major factor to be concerned about. China and low commodity prices for the foreseeable future. Iron Ore is still hovering around $80 a tonne and is not expected to rally any time soon. China's housing and construction boom has slowed significantly and China's insatiable appetite for our commodities has slowed and thus commodity prices are significantly lower than they were at their highs in 2013. In fact if you consider Iron Ore was $140 a tonne in early 2013 and today it's trading at $80 a tonne. It’s no surprise this is contributing to the AUD demise.

Many small tier miners will struggle to even dig it out of the ground for that price and government tax revenues will be lower of course. Roubini says that Australia will struggle to grow at 2% next year and predicts interest rates to go lower than the current 2.5% level. If that was to be true and the US economy continues to grow at current rates and the US Fed puts interest rates up as predicted then 0.70c for the AUDUSD is certainly not out of the question.

The AUDUSD hit a fresh new monthly low of 0.8851 Monday with the 2014 yearly low of 0.8659 now less than 2 cents away. The AUD has dropped over 5 cents in value just this month and according to Bloomberg this makes it the worst performer amongst 10 developed nation currencies.

Andrew Barnett, LTG GoldRock reviews the latest Currency Trading News every day in the Goldrock Insider Report.