Henry Liu
Former FPA Special Consultant
- Messages
- 473
Today’s Retail Sales number from UK will be widely watched as this is a high impact yet tradable report. Here is the forecast for this release:
4:30am (NY Time) Forecast 0.5% Previous -0.2%
ACTION: GBP/USD BUY 1.0% SELL 0.0%
The Trade Plan
Retail Sales by definition is a direct measurement of consumer activities at the retail levels. A higher release is generally good for the economy, and better for it’s currency; a lower release is considered as negative for the economy and not good for it’s currency.
Our tradable deviation or surprise factor for UK Retail Sales is 0.5% to BUY and 0.5% to SELL. If our deviation is hit, we can expect the market to move at least 50 pips within the hour, with a historical accuracy of 74%. We’ll be looking to BUY GBP/USD if we get a 1.0% or better release, and SELL GBP/USD if we get a 0.0% or worse.
We'll be looking for an after-news retracement trade for this release. For more information on my trading methods:
Henry's News Trading Methods.
The Market
GBP has rebounded from yesterday's BOE Gov. King's speech over the possibility of inflation undershooting bank's target of 2.0% in two years. General sentiment is still waiting for a news catalyst to substantiate King's concern as evidenced by the resiliency of GBP today.
However, today's MPC Meeting and the surprising better than expected Claimant Count number are defintely telling a different story than the cautionary tale BOE King is preaching. If this Retail Sales figure surprises to the upside, we could see significant gains in the GBP.
Additional Thoughts
GBPUSD is finding support just around the 1.5800 level, and judging from how the market has been trading, it is possible to see GBP diverging from EUR's bearish trend and push higher... This Retail Sales could be the catalyst for that to happen.
Pre-news Consideration
With Claimant Count showing decreasing in the jobless claims, it is possible that traders may be expecting a better release, as the simple logic of [more people have jobs equals to more money to spend]... I will be looking to BUY GBP/USD prior to the release.
For historical chart & data for UK Retail Sales
Thanks,
4:30am (NY Time) Forecast 0.5% Previous -0.2%
ACTION: GBP/USD BUY 1.0% SELL 0.0%
The Trade Plan
Retail Sales by definition is a direct measurement of consumer activities at the retail levels. A higher release is generally good for the economy, and better for it’s currency; a lower release is considered as negative for the economy and not good for it’s currency.
Our tradable deviation or surprise factor for UK Retail Sales is 0.5% to BUY and 0.5% to SELL. If our deviation is hit, we can expect the market to move at least 50 pips within the hour, with a historical accuracy of 74%. We’ll be looking to BUY GBP/USD if we get a 1.0% or better release, and SELL GBP/USD if we get a 0.0% or worse.
We'll be looking for an after-news retracement trade for this release. For more information on my trading methods:
Henry's News Trading Methods.
The Market
GBP has rebounded from yesterday's BOE Gov. King's speech over the possibility of inflation undershooting bank's target of 2.0% in two years. General sentiment is still waiting for a news catalyst to substantiate King's concern as evidenced by the resiliency of GBP today.
However, today's MPC Meeting and the surprising better than expected Claimant Count number are defintely telling a different story than the cautionary tale BOE King is preaching. If this Retail Sales figure surprises to the upside, we could see significant gains in the GBP.
Additional Thoughts
GBPUSD is finding support just around the 1.5800 level, and judging from how the market has been trading, it is possible to see GBP diverging from EUR's bearish trend and push higher... This Retail Sales could be the catalyst for that to happen.
Pre-news Consideration
With Claimant Count showing decreasing in the jobless claims, it is possible that traders may be expecting a better release, as the simple logic of [more people have jobs equals to more money to spend]... I will be looking to BUY GBP/USD prior to the release.
For historical chart & data for UK Retail Sales
Thanks,
Last edited by a moderator:
