We will be trading the Core CPI release from Canada and our deviation for this release based on historical track record is 0.3%, therefore I’ll be looking for tradable figures of 0.5% or better to SELL USD/CAD or a -0.1% or worse to BUY USD/CAD.
USD/CAD has been consolidating over recent gains and with U.S. economic outlook improving significantly, my longer term view on the USD/CAD pair is actually bullish and we should see 1.1000 as soon as early 2010. Therefore, unless we do get a stronger CPI release, the general direction will remain unchanged for USD/CAD, which is LONG.
This is a preview of Canada Core CPI m/m 12/17/09. Read More...
We’ll be focusing on the Retail Sales release today, which is a direct measurement of consumer activities at the retail levels. A higher release is good for the economy, thus better for it’s currency; a lower release is considered as negative for the economy and not good for it’s currency. Retail Sales makes up a substantial part of the GDP, and the effect of this release could be very profound given the low liquidity condition of the market.
This is a preview of UK Retail Sales m/m 12/17/09. Read More...
FOMC is going to release its short-term interest rate decision for the last time in 2009 and it is widely expected by analysts that FOMC will keep current rates unchanged until 2010. As FOMC rarely make any changes to the key interest rate at the end of the year, there is really no expectation for a surprise change. As far as FOMC officials and chairman Bernanke are concerned, they have stated on more than one occassion that FOMC will not raise interest rate until the latter part of 2010…
This is a preview of FOMC Federal Fund Rate Decision & Statement 12/16/09. Read More...
We’ll be looking to trade Core CPI release and we are going to look for a surprise factor of 0.2%; if the release number (core) increases to a 0.3% then we will BUY of USD/JPY. If the CPI number decreases to -0.1% or less, we’ll SELL USD/JPY. Historically even at a difference of 0.1%, market is likely to to exaggerate, therefore if either of our tradable releases is hit, there is about 80% of chance market will move 50 pips. If you remember what I wrote last time, this is exactly the same consensus expectation as the market is looking at a low yet steady growth in U.S. Inflation for quite some time now…
This is a preview of US Core CPI m/m 12/16/09. Read More...
7:30pm (NY Time) AU GDP q/q Forecast 0.4% Previous 0.6%
ACTION: AUD/USD BUY 0.8% SELL 0.3%
We’ll be focusing on the quarterly GDP release today out of Australia, which is expected by a wide range of analysts surveyed by Bloomberg to be at 0.4%. As Australia’s GDP number has maintained on the positive side for the last couple of quarters, this release number will probably not have a trend changing impact on the AUD unless it’s a negative number.
We’ll be looking for a surprise factor of 0.3%, therefore if we get 0.7% or better, we’ll be BUYING AUD/USD; however, if we get a 0.1% or worse, we’ll probably see AUD/USD test the 0.9000 figure and possibly breakout below.
This is a preview of Australia GDP q/q 12/15/09. Read More...
Today we’ll focus on the CPI release once again out of UK and our surprise factor (or deviation) is at 0.3%. If the yearly Inflation number increases to a surprise of 2.1%, which is over BOE’s inflation target, we will BUY of GBP/USD. If the Inflation number decreases to 1.5% or remain at the same level as last release, we’ll look to SELL GBP/USD. Historically, even at a difference of 0.1%, we should see market overreaction. If our deviation is hit, there is a probability of over 80% that the market will move 50 pips within the next 30 minutes.
This is a preview of UK CPI y/y 12/15/09. Read More...
8:30am (NY Time) US Core Retail Sales Forecast 0.5% Previous 0.2% 8:30am (NY Time) US Retail Sales Forecast 0.6% Previous 1.4% ACTION: USD/JPY or USD/CHF (CORE) BUY 1.1% SELL -0.1%
We will be trading Retail Sales release out of U.S. today. We have both retail sales (healine and core, also know as ex auto) scheduled to be released at exactly 8:30am, and it is important that there is no conflict with these numbers or this will be an automatic no trade. The Core release is usually more accurate reflection of the activities at the retail level because it excludes the volatile Automotive components; the headline Retail Sales should be in the same direction as of the Core reading.
This is a preview of US Core Retail Sales m/m 12/11/09. Read More...
7:00am (NY Time) UK Offcial Bank Rate Decision Forecast 0.50% Previous 0.50%
ACTION: GBP/USD N/A
Bank of England’s Monetary Policy Committee (MPC) is scheduled to release their finalinterest rate decision today for 2010, and consensus expectations are to keep rates at 0.50%, which is no surprise to most traders. However, the important focus today will be the tentative statement that usually only accompanies BOE rate decision if there is a change, but BOE may just issue a statement regarding their APF program, as it has been much of the focus lately.
This is a preview of UK MPC Official Bank Rate Decision (BOE Interest Rate) 12/10/09. Read More...
SNB (Swiss National Bank) is likely to keep the 3-month libor rate at the current level of 0.25%, as surveyed by reuters today. As a matter of fact, most analysts agree that SNB is likely to keep rates unchanged until mid 2010. As SNB is not in the habit of surprising the market, it is practically 100% that SNB will keep rates at 0.25%; however, just in the event that SNB does hike rates, we will SELL USD/CHF immediately.
This is a preview of SNB Libor Rate Decision (Interest rate) 12/10/09. Read More...
Our focus will be on the Australian Employment Changes release today as this news release is equivalent to US Nonfarm Payroll for Australia. This release is considered as a high impact report (and possibly trend changing) as the job’s market have a direct influence over the health of the economy, which in turn affects inflation, and inflation will affect future RBA monetary policy. If the actual release is better, it would be good for AUD and we would be looking to BUY AUD/USD, if the actual release is worse, it would be bad for AUD and we should be looking to SELL AUD/USD.
This is a preview of Australia Employment Changes 12/09/09. Read More...
RBNZ is expected to keep rates unchanged at the current level of 2.50% once again during today’s rate decision, as unanimously agreed by all economists surveyed, according to Bloomberg. As a matter of fact, there seems to be no fundamental reason supporting a rate hike for NZD in the near future, as the current inflationary target for NZD remains below the magical 2.0% level until perhaps 2011…
This is a preview of RBNZ Official Cash Rate Decision (Interest Rate) 12/09/09. Read More...
9:00am (NY Time) CA BOC Rate Decision Forecast 0.25% Previous 0.25%
ACTION: USD/CAD Depend on Market Condition
BOC (Bank of Canada) will renders its Overnight Rate decisions for the last time in 2009, and today’s meeting will be watched by traders and speculators since interest rate policy serves as a tool to curb inflation and maintain price stability, this news event is probably the most important event for the day.
Although there are no official statements or overwhelming market sentiment pointing to a possible hike, as BOC Governor Mark Carney stated in his last rate statement that BOC will maintain rates at low level until the end of first quarter 2010, but with the recent employment changes and GDP release from Canada, speculations of a possible hike or at least acceleration of their monetary policy might tilt the sentiment to a stronger CAD prior to the release…
This is a preview of BOC Overnight Rate Decision (Interest Rate Decision) 12/08/09. Read More...
Last week’s major news was the Nonfarm Payroll report on Friday which possibly changed the short to long term trend of USD as we saw traders bought USD on the back of NFP release:
NFP Nov. 2009 -11K versus -119K (estimate)
NFP Oct. 2009 -111K (revision) versus -190K release
Unemploy Rate 11/2009 10.0% versus 10.2% (estimate)
What was more interesting with this data was the 3-month average trend of NFP with past revisions actually netted a positive +97K of release!
This is a preview of FOREX – NFP Nonfarm Payroll (12/04/09) and Market Analysis. Read More...
We will be trading the NFP release number today, which is expected at -120K with a previous release of -190K; if you remember what happened last NFP, you’d know that the release consensus expectation slightly, but with postive benchmark revisions of last 3 months’ NPF releases, we actually got about +70K of deviation… However, these positive releases from past revisions didn’t really matter to traders as the Unemployment Rate broke above the 10.2%, which brought an immediate risk aversion sentiment as we saw stronger JPY across the board…
This is a preview of US NFP (Nonfarm Payroll) Employment Changes 12/04/09. Read More...
7:00am NY Time CA Employment Changes Forecast 15K Previous -43.2K
ACTION: USD/CAD SELL 45K BUY -15K
We’ll focus on the Canadian Employment Changes event, which is going to be the first of two high impact news releases for this Friday, with NFP being the second event scheduled just 90 minutes later. We are looking for a surprise factor (trigger, deviation) of 30K, therefore if we get a positive 45K of release, we’ll look to SELL USD/CAD; on the other hand, if we get a -15K of release, we’ll look to BUY the USD/CAD pair.
This is a preview of Canada Employment Changes 12/04/09. Read More...
10:00am NY Time US ISM Non-Manufacturing PMI Forecast 51.6 Previous 50.6
ACTION: BUY 54.0 SELL 49.0 USD/JPY
Today we’ll tradethe ISM Non-Manufacturing PMI, or better known as the Services PMI, which is a leading indicator of the nation’s Services sector, as many investors look at this release for directional references on the near-term future of the economy. With the current analyst’s expectation at above the 50 level or 51.6, in the event that 54.0 is reached, we could see risk appetite returning to the market as JPY weakens across the board; however, if the opposite is true, or 49.0 figure is released, expect to see stronger JPY and possible stronger USD from risk aversion flows.
This is a preview of US ISM Non-Manufacturing PMI 12/03/09. Read More...
8:30am NY Time ECB Chairman Trichet Press Conference
ACTION: N/A
Trichet usually delivers an official statement along with a Q&A session 45 minutes after the official rate decision at 8:30am. This press conference is usually very volatile and the market is always looking for clues from Trichet’s tone over future monetary policy directions. If Trichet is hawkish over the future of EURO, namely talking about exit strategey and possibility of rate hikes, then we will see EURO gaining across the board; however, if Trichet is dovish, focused on how slow the recovery might be and also on the issues over the imbalances of recovery within the members of EURO Zone, we’ll probably see EURO trade lower against other currencies… Furthermore, Trichet will never tell you what you want to hear… therefore you need to listen between the lines and keep an eye on the market for confirmation.
This is a preview of ECB Trichet Press Conference 12/03/09. Read More...
It is widely expected that ECB (European Central Bank) is likely to leave its official interest rate once again at 1.00%, or unchanged. Analysts surveyed seem to agree that it is too soon for ECB to hike interest rate. ECB’s next interest rate move is likely to be a hike, but it probably won’t take place until the end of first quarter of 2010 as I’ve pointed out in the analysis during last ECB Rate Decision.
This is a preview of ECB Minimum Bid Rate Decision (Interest rate decision) 12/03/09. Read More...
4:30am (NY Time) UK Service PMI Forecast 57.1 Previous 56.9
ACTION: GBP/USD SELL 55.00 BUY 59.00
Our focus will be on the Services PMI figure today and we’ll look for a minimum deviation of 2.0 from the forecast release figure. If we get at least 59.0 or better, we could see further demand in the GBP that should justify for LONG trades on GBP/USD or GBP/JPY pairs. If we get a 55.0 or worse release, GBP could weaken or at least show a quick profit taking reaction from the overnight bullish move.
This is a preview of UK Services PMI 12/03/09. Read More...
7:30pm NY Time AU Retail Sales Forecast 0.4% Previous -0.2%
ACTION: BUY 1.0% SELL -0.2% AUD/USD
Our focus today will be to look for a deviation of 0.6% from the forecast release of 0.4%. Therefore, if we get a 1.0% or -021%, we’d have our trigger to get in either on a LONG or SHORT trade depending on the release, with a high probability of seeing the market moving over 50 pips in the next 2 hours.
This is a preview of Australia Retail Sales m/m 12/02/09. Read More...
8:15am NY Time US ADP NFP Change Forecast -149K Previous -203K
ACTION: USD/JPY BUY -80K SELL -230K
Our focus today will be on the ADP Employment Release. ADP is the largest private payroll processing providers in the U.S., and it releases its version of Non-Farm Payroll numbers about 2 days before the actual NFP, based on it’s proprietary data. About 80% of the time ADP’s release will go in tandem with the official NFP, but the for the 20% of the exceptions, we’d get figures that could be totally off. This is an excellent indicator for the general risk sentiment of the market as U.S. Employment situation is a global concern; and of course this release sometimes serves as a preview of the NFP on Friday; if the numbers comes out as a surprise of at least 70K more or less from the Forecast of -149K, we should look to trade in the direction of the surprise.
This is a preview of US ADP NFP (Non-Farm Payroll) Change 12/02/09. Read More...
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