Written by dustin pass
Wednesday, September 15th, 2010
TRADE CALL RECAPS
For our last live trade calls, we were watching the UK CPI and US Retail Sales reports yesterday morning. For the UK CPI release, we were looking to buy the GBPUSD if the number came out at least 0.2% better than expected. The actual number came out only 0.1% better, so it did not meet our safe trigger. For the US Retail Sales, we were looking to buy the EURJPY if the number came out at least 0.5% better than expected. The actual number came out only 0.3% better than expected, so again it did not meet our triggers.
OUR NEXT LIVE ON THE NEWS TRADE CALL
Our next live trade opportunity comes tomorrow when the UK Retail Sales report is released at 4:30 am EDT (8:30 am GMT). This is one of my favorite trades of the month as it often meets our triggers and we typically see a good move when it does.
For this release we will focus on the Retail Sales (MoM) figure, and the expected number for this report is 0.2%. We will be looking for a deviation of at least 0.4% on this report to trigger a safe trade. A higher than expected number will be good for the GBP and signal a long on the GBPUSD, and a lower than expected number will be bad for the GBP and signal a short on the GBPUSD.
We will prefer to see a sell trigger on this particular release as it could affect the GBP more if the number comes out worse than expected. However, we could still see a 20-40 pip move if the safe buy trigger is met. I will most likely close the entire trade with 20-40 pips if we get a buy trigger. If we get a sell trigger and get a move of 30-40 pips, I will most likely close a portion of the trade and then lock in and hold the other portion of the trade for an even larger potential move.
The UK Retail Sales has met our safe trigger nine times in the last year, and the GBPUSD moved between 25 and 80 pips each time, except for a couple of times in which there were extenuating circumstances. Last month we recommended setting the medium trigger to 0.4% and the safe trigger to 0.6%. The actual number came out enough to meet the higher safe trigger, and traders reported up to 75 pips of profit on the trade. The chart below shows how the GBPUSD reacted to last month’s release:
The video of last month’s trade can be seen below:
httpv://www.youtube.com/watch?v=BVAXTdPnyjo
This is our current outlook for this trade; 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 release to get my commentary on this potential trade.
Good Luck!!!!
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