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Forex Signal (Thu, August 5 2010, 7:00am NY Time EDT) - UK BOE Interest Rate

Discussion in 'Current Forex Trading Signals' started by Henry Liu, Aug 4, 2010.

  1. Henry Liu

    Henry Liu Former FPA Special Consultant

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    BOE (Bank of England) will be rendering its interest rate decision today, and it should provide strong volatility in the market if BOE's final decision is a surprise, here's the forecast:

    7:00am (NY Time) UK Offcial Bank Rate Forecast 0.50% Previous 0.50%
    ACTION: GBP/USD BUY 0.75%


    The Trade Plan
    In the unlikely event BOE hikes rate to 0.75%, we'll buy GBP/USD immediately on a spike trade. Because of the level of this surprise, I think we'll see a strong trend change for GBP in the next few weeks, so we should BUY and keep a small portion for larger gains...

    I'll be trading this release using my Spike Trading Method, for more information:
    Henry's Trading Methods.

    The Market
    UK’s BOE, Bank of England’s Monetary Policy Committee (MPC) is once again scheduled to release their interest rate decision today and the expectations are to keep both their official bank rates at 0.50% and APF (Asset Purchasing Facility) of 200 Billion Pound unchanged. The important focus as usual will be the accompanying BOE Statement if they decide to release one, and it is customary for BOE to only release a rate statement if there is a change in either the Interest Rate or the APF.

    Bloomberg’s survey of over 59 economists showed unanimous decision at unchanged verdict, therefore it is very likely this would be a no event. Furthermore, out of the 34 economists surveyed on the APF stimulus program, all 34 agreed that BOE should also keep it unchanged.

    With the stellar 2nd quarter GDP release out of the UK 2 weeks ago and the ambitious spending cuts by the new administration, BOE Governor King may be leaning towards recovery more than controlling inflation. With UK's inflation just above the target at 3.2%, the overall expectation is to see a gradual leveling off towards end of 2010. BOE may not need to hike rates until 2011.

    Additional Thoughts
    If BOE surprises the market, we should enter on a BUY immediately because we should see strong demand for GBP and this demand will be sustained for weeks... so it doesn't really matter if you get slipped 50 pips or your broker widened your spread, it should work out in the end...

    Pre-News Consideration
    We are seeing a bit of pull back on the GBP/USD after a failed attempt to breach 1.60. With ECB rate decision and Trichet's conference following close behind, we may not get much push in the market. I'd be looking for a possible ranged trading day today, therefore a BUY on dips for GBP should be justified.

    Historical chart and data for UK BOE Interest Rate


    Thanks,


    [​IMG]
     
    #1 Henry Liu, Aug 4, 2010
    Lasted edited by : Sep 8, 2016
  2. rainwater

    rainwater Recruit

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    thanks

    hey Henry,

    thanks for everything. you rock!

    and happy belated birthday. August 3rd is my sister's birthday too :)
     
  3. sonny77

    sonny77 Private

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    Hi.. Henry,

    Happy B'day Henry, MAY GOD BLESS YOU ALWAYS.

    Best regards
     
  4. gen

    gen Recruit

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    hi Henry what is the time of the news in GMT+1?I mean boe and trichet speech:unhappy:
     
  5. Brahma

    Brahma Recruit

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    worth watching advice

    thanks henry , i am really getting the expected results almost every time. i always follow your advice which is indeed worth watching . happy birthday !! may god bless you .
     
  6. Maleewan B

    Maleewan B Recruit

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    Henry's forecast

    Hi Henry,

    you were 'spot on' again.... your email alert said to BUY GBPUSD on lows today... and just bagged 50 pips in 2 hours, without having to trade the Nes.Thank you :)
     
  7. Maleewan B

    Maleewan B Recruit

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    sorry,i must have been too excited ...should have read 'without having to trade the News'.:cute:
     
  8. Huwee

    Huwee Corporal

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    Hi Gen,

    GMT+1 is currently the local time for Ireland and the UK (note both countries currently in daylight savings, normally they're GMT).

    So in Ireland / UK times, you are watching for:
    12 noon: UK BOE Interest Rate
    12.45pm: EU ECB Interest Rate
    1.30pm: EU ECB Trichet Statement

    Also check out TimeAndDate .com for help converting times...

    Huwee
     
  9. lilygirl

    lilygirl Recruit

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    How can I get the alerts as well

    Hi Henry I heard its you birthday. Happy Birthday. How did Malween get this alert. How can I get the alerts as well. Have you started the 10k to 1M challenge yet.


    Lilygirl
     

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