10:00am (NY Time) CA IVEY PMI Forecast 56.0 Previous 50.8
ACTION: USD/CAD SELL 55.5 BUY 49.0
We’ll be trading the IVEY PMI from Canada today, it is the equivalent of both ISM PMI’s out of US where purchasing managers of all sectors of the economy participate in this survey. And as with PMIs, they are all considered as leading indicators with the medium point at 50, therefore a reading of above 50 would be considered as expansion in the economy whereas a reading below 50 would be considered as contraction in the economy.
Our tradable surprise factor is 3.0 as it has provided a good historical track record; we need to get either a 59.0 or 53.0 (based on a forecast figure of 56.0) for us to take a trade. IVEY PMI is usually tradable before the Canadian Employment Changes and not after when scheduled at the same day. However, this Friday we won’t be trading the Employment Changes from Canada, it is scheduled on the 12th of March.
With commodities gaining across the board and USD/CAD breaking recent support areas, if we were to get a strong surprise to the upside, expect to see USD/CAD testing the lows around 1.0200; if we get a surprise to the downside, market may still push USD/CAD down as the next strong support for USD/CAD sits at the 1.0200 area.
DEFINITION
“The Ivey Purchasing Manager’s Index (PMI) measures the activity level of purchasing managers from all sectors of the economy, with a reading above 50 indicating expansion. A rising trend has a positive effect on the nation’s currency. To produce the index, purchasing managers are surveyed on a number of subjects including employment, production, new orders, supplier deliveries, and inventories. Traders watch these surveys closely because purchasing managers, by virtue of their jobs, have early access to data about their company’s performance, which can be a leading indicator of overall economic performance.”
Related posts:
- Forex News Trading For Canada IVEY PMI 10/06/10
- Forex News Trading Canada IVEY PMI 01/06/11
- Canada IVEY PMI 10/06/09
- Canada IVEY PMI 02/04/10
- Canada IVEY PMI Trade Plan For 07/07/10
- AU Canada IVEY PMI 04/07/10
- Canada IVEY PMI m/m 01/07/10
- Forex News Trading CA IVEY PMI 05/05/11
- Forex News Analysis For Canada IVEY PMI 10/06/11
- Forex News Trading CA IVEY PMI 04/06/11
{ 3 comments… read them below or add one }
thanks for your analysis. it has continued to help my trading the news. without it i will be lost. but your numbers for the CAD IVEY PMI is confusing. since the SF is 3.0,thus it suppose to be SELL 59.0 and BUY 53.0. instead you wrote SELL 55.5 and BUY 49.0. however,i think this is an error. yesterdays UK SERVICE PMI SF was hit but at that particular period it didn’t move the market.pls can you explain this to me cos i am not yet a guru in forex.hoping to hear from you as always. thank you
Halooo~~~Is that possible for me to minimize loss for my News trades if False breakouts or whipsaws happen on some news (Non Farm Payroll for example)?
Vinsley:
This is a rather general question and the only one to avoid whipsaw is to understand the news and market sentiment at the time. Of course if you use tight stoploss orders should also help minimizing your loss.
Henry