Forex Signal (Tuesday April 17, 2012 – 9:00am EDT) – CA BOC Rate Decision

Hi all,

Please see my trade Plan below:

CA BOC Rate Decision
Forecast 1.00%
Previous 1.00%
Pair to trade: USD/CAD

Numbers we need:
BUY USD/CAD 0.75%
SELL USD/CAD 1.25%

Economical Impact: High
Typical Result: Hawkish is Good for Currency
Occurrence: Scheduled 8 times per year
Spike Probability: Good, we can see 60 pips on initial spike

About our Triggers:
CA GDP m/m is forecasted to arrive at 1.00%
We are looking for a deviation of 0.25% either way on this trade.
If we get 1.25% or better I will look to enter a SHORT position on USD/CAD and if we get
0.75% or lower I will go LONG on USD/CAD.
Should this report be triggered, we can expect to see about 60 pips on the initial spike.
We have no known conflict for this release. This trade will have a good chance of a 30% retrace on the initial spike

What is it? And why does the market care?
The Bank of Canada (BOC) decision on short term interest rate. The decision on where to set interest rates depends mostly on growth outlook and inflation. The primary objective of the central bank is to achieve price stability. High interest rates attract foreigners looking for the best "risk-free" return on their money, which can dramatically increases demand for the nation's currency.

A higher than expected rate is positive/bullish for the CAD.
A lower than expected rate is negative/bearish for the CAD.

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

Insight views on Euro Crisis
see my views here

I will look for a 30-50% retracement in the original spike before entering a trade; I will sell half my position as soon as I hit the original high point of the first initial spike and place a SL at entry 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.

I do recommend spike trading as an option when there is great uncertainty in the markets; also the liquidity is very good at the moment if you are using an ECN broker.

Historical Chart and Data for CA BOC Rate Decision

All the best

Stavro D’Amore

 

really thank u sir i am reading ur news every day and found really good.but unforunately it is very difficult to do spike trading. for an example before 1 min news release i put 10 pip above buy stop and sel stop so whether news good for currency or not it wil execute one trade and goind either up or down .how ever when the time news release with the spike my mt4 platform is not execute the price which i given at the same price. some times it ir execute 20 pip after the given price automatically . do u have an idea to oercome this problem sir.

 

Your method using an MT4 platform is a sure way to lose a bunch of money. The only way to spike trade is with a fast news auto clicker...The Weapon, for instance...which costs $$$, and a really compliant broker...or to try and do what Stavro is telling you to do.

Save your money and stop doing what you're doing.