Canada GDP m/m 07/31/09

8:30am CA GDP m/m     Forecast -0.4%    Previous -0.1%
ACTION: USD/CAD          SELL 0.1%               BUY -0.7%

Our focus will be on CA 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 BOC’s decision directly.

We are looking for a +0.5%  and -0.3% deviation on the expected 0.1%.  Therefore if we get a 0.1% on the monthly GDP, it would be somewhat CA Dollar positive.  We will SELL USD/CAD.  However, if we get a -0.7% release, then we would be BUYING USD/CAD.

If our surprise is hit, the market will move 40~50 pips within the hour 80% of the time.   However, with US Quarterly Advanced GDP scheduled to be released at the same time, we’ll just take one trade based on the best case scenario… If we get a conflict with US data, we’ll likely to skip this report as the US GDP takes precedence.

UPDATE: I didn’t trade this release as the US GDP was my primary focus.  The entire market went on a high volatility mode and went back on a whipsaw at the end of London trading session…  Watch the video as I gauge market reaction and call a trade.

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Related posts:

1. Canada GDP (Gross Domestic Product) m/m 10/30/09
2. Canada GDP m/m 08/31/09
3. Canada GDP m/m (Gross Domestic Product) 09/30/09
4. Canada BOC Overnight Rate Decision 09/10/09
5. Canada BOC Overnight Rate Decision 10/20/09
6. Canada GDP m/m 11/30/09
7. Canada Employment Changes 12/04/09
8. Canada Core CPI m/m 10/16/09
9. Canada Core CPI m/m 11/18/09
10. BOC Interest Rate Decision 07/21/09