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Forex Signal (Monday October 3, 2011 – 11:30pm EDT) – AU Interest Rate

Discussion in 'Current Forex Trading Signals' started by Stavro D'Amore, Oct 2, 2011.

  1. Stavro D'Amore

    Stavro D'Amore Former FPA Special Consultant

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    Hello members,

    Today we have AU Interest rate due to come, this will be an interesting release due to the current circumstances, Please find my trade plan bellow.

    AU Interest rate
    Forecast 4.75%
    Previous 4.75%
    Pair to trade: AUD/USD

    Numbers we need:

    BUY AUD/USD 5.00% or greater
    SELL AUD/USD 4.50% or lower


    Economical Impact: Critical
    Typical Result: Hawkish, Good for Currency
    Occurrence: First Tuesday of the month in Australia,
    Spike Probability: Good, we can see 50 pips on initial spike

    About our Triggers:
    If RBA increases interest rates, we should SPIKE in AUD of 50 pips and I will buy AUDUSD or other AUD crosses.
    At the present moment, the expectation for a rate hike was one of this year's greatest guessing games, with a decrease on rates is on the cards too, we could see some AUD sell off prior to the news.

    If RBA decrease the rate we could see a 50 pip spike to the down side with AUD trending under parity by week’s end.

    Current pressure from the government’s new carbon tax, poor performing markets and pull back in the housing market of 15%. We could also see rates decrease.
    RBA will make further statements after the release in the condition of the economy and there forecast this will make the AUD very volatile.

    If the RBA decides to keep rates unchanged, we may see a sell-off, as the accompanied RBA statement may be dovish in light of recent news events.

    What is it? And why does the market care?
    The Reserve Bank of Australia's monthly interest rate statement describes its latest decision regarding changes to the country's short term interest rates, monetary policy, and the direction of the economy.
    Short term interest rates are the key factor in currency valuation. A dovish statement could push AUD down against its rivals, while hawkish statement could boost the currency.

    Method I use to trade this:
    Stavro D’Amore Trading Method

    I will Look to sell AUD/USD around 30 min prior to news and be closed out of this trade before its release, I will base my trade on volume Price action and selling MACD and TRIX indicators on a 15 min chart.

    I will not trade SPIKE on this release as there is great chance of slippage and latency.

    I will look for a 30% retracement in the original spike if our triggers are hit before entering. I will be looking at a 5 minute chart. I will close half my position as soon as I hit the original high point of the first initial spike and place a SL at the original spike price.

    My TP level would be just before a resistance level or if the chart decides to form a support level, looking at a 15 minute chart time frame to analyze this.

    Historical Chart and AU RBA Interest Rate

    All the best

    Stavro D’Amore
     
    #1 Stavro D'Amore, Oct 2, 2011
    Lasted edited by : Sep 8, 2016
  2. strangelove

    strangelove Recruit

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    Awesome analysis. So much better than Henry Liu.
     
  3. dkami

    dkami Sergeant

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    Yes I agree Henry LIE was only interested in getting his SCAM up and running and to suck in all the newbies on this site


    Keep up the good work Stavro
     

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