TRADE CALL RECAP
For our last live trade call, we were looking at the UK Industrial Production report on Tuesday morning. For this report, we were looking to sell the GBPUSD if the number came out at least 0.5% worse than expected. The number came out at 0.5% worse than expected, so it just met our safe buy trigger. The GBPUSD dropped about 20 pips, and we had traders report profits of up to 10 pips on this particular trade. The video for this trade is below:
httpv://www.youtube.com/watch?v=Wnm-PyVNw8g
TRADE OPPORTUNITIES LATER TODAY
There are two opportunities for trades later today when the New Zealand Interest Rate and Australian Labor Change reports are released. The first opportunity comes at 3:00 pm EST when the NZD Interest Rate number is released. The expectation is that they will leave the current interest rate at 2.5%, but if they raise or lower the rate it could cause a substantial move in the NZDUSD. In the past we have seen moves of 100 pips or more if the number deviates from the expectation.
I would recommend trading the NZDUSD for this particular release and to use caution as this particular data has a tendency to come out later than expected. If you see a large move on the NZDUSD before the data comes out in the RSS, I would strongly recommend turning the auto-click off. I would also strongly recommend trading less lots than you normally would on a news trade.
The second opportunity later today comes when the Australian Labor Change report is released at 7:30 pm EST. The focus should be on the Labor Force Employment figure, and the expectation for this release is 5.3k jobs. We have placed a safe trigger of 15k jobs for this release. We have historically seen moves of around 25 to 75 pips when this release has met the safe deviation.
We will most likely prefer to see a buy trigger on this particular release as a more positive number will most likely be more of a shock than a worse than expected number. We could still get a good move on a sell trigger, but you will likely want to exit with 25-40 pips of profit if it triggers a sell. You will want to keep a close eye on this release as the news can sometimes come out a little late. If you see a quick move on the AUDUSD before the news comes out, you will want to shut off the auto-click quickly.
This release has met the safe trigger in eight of eleven months this year and has provided a 30 to 80 pip move each time. This release last met our safe trigger last month, and the AUDUSD moved approximately 60 pips due to a significant deviation. The chart of the AUDUSD at the time of October’s release is below:
We will not have the Live Trade Room open for these trades, but I wanted to make you aware of the opportunities.
OUR NEXT LIVE ON THE NEWS TRADE CALLS
We will have two opportunities for trades tomorrow when US and Canadian Trade Balance reports are both released at 8:30 am EST.
Our main focus will be on the Canadian Trade Balance, as we typically see better moves if this release meets our safe trigger. If you are only able to trade one currency pair with your broker, you should trade the EURCAD for this release as the US data is coming out at the same time. For this report, the expected number is -$0.6 Billion. A higher than expected number will be good for the CAD and signal a short on the EURCAD, and a lower than expected number will be bad for the CAD and signal a long on the EURCAD. We will be looking for a deviation of $0.8 Billion on this report to signal a safe trade.
The EURCAD has been in a down trend for the last week so we will prefer a sell, but it could be tradable either way. We will want to use caution on this release as we have not seen a very strong move in the last couple of months, even when this release has met our safe triggers. In fact, I suggested not trading this particular release last month because of this. We also had some incorrect data on this last month that initially signaled a buy but later changed to a sell, so again we will want to use extreme caution on this release.
This report has hit our safe trigger six times this year, and the market has typically moved 15-50 pips. This release last met our safe trigger in October and we had a few traders report making up to 10 pips on this trade. Below is a chart with the movement on the EURCAD at the time of October’s release:
To see a video of October’s trade, click on the link below:
httpv://www.youtube.com/watch?v=MM0Mmye0f0g
For the US Trade Balance, the expected number is -$36.8 Billion. A higher than expected number (less negative) will be good for the USD and signal a long on the EURJPY and a lower than expected number (more negative) will be bad for the USD and signal a short on the EURJPY.
This report met our safe trigger in five of the last seven months and the EURJPY only moved approximately 15-30 pips each time, even with very strong triggers. This is why we focus more on the Canadian release. I would recommend raising the safe trigger to at least $5.0 Billion and expect to see a 15-20 pip move with that deviation or higher. I would also recommend trading the EURJPY as it has the tendency to move better than the USDJPY.
To see a video of April’s trade, click on the link below:
http://www.forextradersdaily.com/vid/USCADTradeBal040909/
This is our current outlook for these trades; however, it is subject to change as market conditions may change by tomorrow. Be sure to log in to the Live Trade Room 15 minutes prior to the releases to get my commentary on these potential trades.
Good Luck!!!!
HOW TO TRADE THE FREE CALLS
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