1. This site uses cookies. By continuing to use this site, you are agreeing to our use of cookies. Learn More.

Forex Signal (Thu January 20 2011, 4:45pm NY Time EST) - NZ Retail Sales m/m

Discussion in 'Current Forex Trading Signals' started by Henry Liu, Jan 20, 2011.

  1. Henry Liu

    Henry Liu Former FPA Special Consultant

    Jul 5, 2010
    Likes Received:
    We’ll be getting the Retail Sales figure out of New Zealand today, since Retail Sales is a direct reflection of the economy, this release is considered as an high impact release… Here’s the forecast:

    4:45pm (NY Time) NZ Retail Sales Forecast 1.3% Previous -2.5%
    ACTION: NZD/USD BUY 2.0% SELL 0.6%

    The Trade Plan
    Retail Sales release is the measurement of consumer spending in the retail sector, as it reflects the strength of the economy and the strength of consumer spending. We’ll be looking for a difference (or deviation) of at least 0.6% from the Forecasted number, therefore a positive 2.0% (or better) will be somewhat bullish signal for NZD and a 0.6% (or worse) will be a bearish signal for NZD. Our focus will be on the Headline release, not on the Core Release… However both releases shouldn’t conflict, or it will be an automatic no trade.

    We'll trading this release using after-release retracement trade method. Because NZD/USD is a very slow moving currency, if we get our BUY (0.6%) or SELL (-0.6%) figures, we should get plenty of opportunities for an entry...

    For more information on my news trading methods:
    Henry's News Trading Methods.

    The Market
    RBNZ will be rendering its interest rate decision next week, and consensus expectation is for an unchanged verdict. This sentiment may change if we get a much stronger/worse Retail Sales figure today.

    With NZDUSD already retracing from recent highs due to the "as expected" release on the quarterly CPI today, if we get a weak release today, NZD could sustain significant consolidation for the next few trading sessions.

    Additional Thoughts
    It is also important to point out that fundamental outlook and economic indicators, such as the Retail Sales figure, does not have much effect on NZD as this currency follows risk sentiment and correlates strongly with global equity market (and commodities, of course).

    One word of caution: Due to the release time of this news, there will be less liquidity than normal. I suggest that unless we get our tradable deviation, staying out of this release is a must. In the event that we do get into a trade, market may move slowly and we may have to hold on to this trade for a few hours.

    Pre-news Considerations
    There is no pre-news sentiment for this release.

    “Measures the value of sales at the retail level. A rising trend has a positive effect on the nation’s currency because Retail Sales make up a large portion of consumer spending, which is a major driver of the economy and has a sizable impact on GDP. Traders pay close attention to Retail Sales because it is usually the first significant indicator of the month that relates to consumer behavior and is susceptible to surprises.”

    Historical Chart & Data of NZ Retail Sales


    #1 Henry Liu, Jan 20, 2011
    Lasted edited by : Sep 8, 2016
  2. nkonye505

    nkonye505 Recruit

    Jan 8, 2009
    Likes Received:
    fundamental analysis

    if the ACTUAL FIGURE release is better than the FORECAST FIGURE figure,the news is usually good for the currency.then we go LONG/BUY the currency releasing the news.
    please i will to know,what if the ACTUAL FIGURE RELEASE is the same as the FORECAST FIGURE?,IS IT A BUY OR A SELL SIGNAL?
  3. Ahmed H

    Ahmed H Private

    Jun 19, 2010
    Likes Received:
    you should stay out of the trade if the actual figure is same as the forecast.

    But with experience you can trade the ones with little deviations..
    for eg: say if the market reacts with 50pips spike north on a 0.2 deviation instead of 0.6 deviation (0.6 being the recommended deviation) then assuming that the market over reacted you could sell at the tip of the spike for a few pips. its not recommended by henry but has worked for me a few times..

Share This Page