US Prelim GDP is also known as the 2nd Quarterly GDP release. Since GDP is the measurement of the economy, traders pay more attention to this release as any surprise numbers could change the short term trend… Here is the forecast:
8:30am NY Time US Prelim GDP q/q Forecast 3.5% Previous 3.2%
ACTION: USD/JPY BUY 3.8% SELL 3.2%
We’ll be trading the 1st (Q1 2010) quarterly release of U.S. GDP number. The first release, or the Advanced GDP release last month, came out surprising upwards at 3.2% and we’ll probably not see much volatility in the market on this second release as more usually during the 2nd release more data have become available thus less possibilities of a surprise. The important fact is to consider the context of the market at the time of the news release, remember market have priced in this release already.
Our deviation is going to be 0.3% and if we get 3.8% release, it would be good USD; if we get a 3.2%, it would be negative for USD. With the current risk aversion sentiment that is supporting USD rally, traders may prefer to BUY USD against EUR on the back of a more than expected release figure… therefore we could also look at EUR/USD pair for an alternate trade.
DEFINITION:
“GDP, which is defined (from wikipedia) as “the market value of all final goods and services produced within a country in a given period of time. It is also considered the sum of value added at every stage of production of all final goods and services produced within a country in a given period of time.” GDP number has a direct effect on the Interest rate of the currency, it is one of the news indicators that affects FOMC’s decision directly.”
Related posts:
- Forex News Trading UK Prelim GDP 10/26/10
- Forex News Trading UK Prelim GDP q/q 01/25/11
- Forex News Trading UK Prelim GDP q/q 07/26/11
- Forex News Trading UK Prelim GDP q/q 04/27/11
- UK 2nd Quarter Prelim GDP Analysis & Video 07/23/10
- Forex Trading Plan For UK Revised GDP q/q 08/27/10
- UK Revised GDP q/q 02/26/2010
- Forex News Trading UK Revised GDP q/q 02/25/11
- Trading Plan For AU GDP q/q 08/31/10
- Forex News Trading UK Revised GDP q/q 11/24/10
{ 8 comments… read them below or add one }
Do we enter a trade if there was a gap like there was today ??
best regards
I don’t really gap trade, but usually when there is a gap it means some news took place over the weekend.
Gap traders assume that gaps will be closed. It is like saying hey if the market moves up during open, I am going to SELL because it will be going down. Market moves like waves, so yes, with or without gaps, market will move.
I have a question please and that is: what is the expected number of pips movement for today’s USD GDP news with respect to (1) EUR/USD and (2) USD/JPY?
I need clarifications as i am still very new in news trading. Your response will be greatly appreciated. Thank you.
50 pips of movement if we get our tradable deviation. That is what EXPECTED MOVES mean.
Thanks Henry, for your newsletter and the free news trading alert.
Though i am new to news trading but i have gained a lot of insights through your publications, and i sure would like to be in your mentoring class.
Keep up the good work!
Thank you!
Hello Henry.
I’ve been watching your signals for 6 months.
It is time for me to become a serious Trader.
Would u please allow me to enjoy your Trading Room?
Please.
Thanx
Traderoom is still not open to public Herbert. I just don’t want to dilute the service. But please participate in the upcoming contest, it is the only way so far. Thanks for your interest.