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ECB (European Central Bank) will be rendering its rate decision today, and it will have a pivotal short term impact in the Euro dollar. However, it is widely believed that ECB will keep rate unchanged at 1.00%… Here´s the forecast:
7:45am (NY Time) EU ECB Rate Decision Forecast 1.00% Previous 1.00%
ACTION: EUR/USD SELL 0.75%
BOE (Bank of England) will be rendering its interest rate decision today, and it would provide strong volatility in the market if BOE´s final decision turns out to be a surprise, here´s the forecast:
7:00am (NY Time) UK Official Bank Rate Forecast 0.50% Previous 0.50%
APT (Asset Purchasing Target) Forecast 325B Previous 325B
ACTION: GBP/USD BUY 0.75% (Rate) / SELL 375B (APT)
Australia Employment Change is similar to U.S. NFP (Nonfarm Payroll) and Canada Employment Change, this is an economic indicator for the Employment Changes in Australia, here´s the forecast:
7:30pm (NY Time) AU Employment Change Forecast 5.2K Previous 46.3K
AU Unemployment Rate Forecast 5.2% Previous 5.2%
ACTION: AUD/USD BUY 30.0K / SELL -20.0K
Australia GDP is a quarterly release similar to the U.S. Advanced GDP or the UK Pre-lim release, but usually there is only one release per quarter, and it is scheduled about 65 days after the quarter ends. Since this is a quarterly release, it is a high impact release that may change the short term trend of AUD.
Here is the forecast:
7:30pm (NY Time) AU GDP q/q Forecast 0.7% Previous 1.0%
ACTION: AUD/USD BUY 1.0% SELL 0.4%
Canada´s monthly GDP report will be released today. Here´s the trading forecast:
8:30am NY Time Canada GDP m/m Forecast 0.3% Previous -0.1%
ACTION: USD/CAD SELL 0.5% / BUY -0.1%
The Trade Plan
Let´s look to SELL USD/CAD if we get a 0.6% or better release, or we’ll BUY USDCAD on a 0.0% or worse release. With recent uncertainty in the commodity space, a strong fundamental such as the GDP figure may be the catalyst we need to see more volatility in CAD, and perhaps set the tone for the rest of the year…
Here is the forecast for the US Prelim GDP q/q (Q4 2011) :
8:30am (NY Time) US Prelim GDP q/q
Forecast 2.8% Previous 2.8% (Adv. GDP)
ACTION: USDCHF BUY 3.1% / USDJPY SELL 2.5%
The Trade Plan
We are looking for a deviation between 0.3% from the forecasted figure of 2.8%. Therefore if we get a 3.1% on the fourth quarter GDP, it would be US Dollar positive. We will BUY USD/CHF. However, if we get a 2.5% release or worse, then we would be SELLING USDJPY. We’ll be looking to trade this release based on my Retracement Trading Method; since this is a high impact release, strong market volatility is expected immediately after the release.
We´ll be getting the Retail Sales figure from Australia today once again, and if you´ve been following news out of Australia, you´d know that Retail Sales has been a sticky point for Aussie economy and a strong improvement may change the short term trend for the currency. Here´s the forecast:
7:30pm NY Time AU Retail Sales Forecast 0.3% Previous -0.1%
ACTION: AUD/USD BUY 0.8% SELL -0.2%
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