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Forex Signal (Wed April 27 2011, 4:30am NY Time EST) - UK Prelim GDP q/q

Discussion in 'Current Forex Trading Signals' started by Henry Liu, Apr 26, 2011.

  1. Henry Liu

    Henry Liu Former FPA Special Consultant

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    UK quarterly GDP release is always a high impact report. With this being the Prelim release, or the first release of three, we are likely to see more market participation. Here is the forecast number:

    4:30am (NY Time) UK Revised GDP q/q Forecast 0.5% Previous -0.5%
    ACTION: GBP/USD BUY 0.8% SELL 0.2%

    The Trade Plan

    Our deviation for today’s trade is 0.3% to SELL and 0.3% to BUY. We’ll look to possibly SELL GBP/USD at 0.2% of release figure or worse; BUY GBP/USD at 0.8% of release figure or better.

    Depending on the surprise of this release, we could go from after news retracement trade to spike trading. I believe if we get a 1.0% or better release, it justifies spiking trading to buy GBPUSD immediately. If we get 0.0%or worse, then it is also justified to SELL GBPUSD on a spike trade.

    For more information on my trading methods, please read:
    Henry Liu's Trading Method


    The Market
    Expect a slight bounce back from fourth quarter GDP numbers. Britian has continued slight economic growth but with very little momentum. The economy is simply stagnant at the moment. Gross Domestic produce rose .5% and retail sales data were also dissapointing.

    Another indicator of a slow moving economy were the results of the BOE Minutes meeting where officals were concerned that a rate increase could affect consumer confidence.

    However, with the recent bullish sentiment in GBP and the split vote during last MPC Meeting, traders will look for any reason to BUY GBP, therefore a positive or flat release should justify a BUY.

    Additional Thoughts
    I’d be possibly inclined to jump in as a spike trade if we get a positive release of 1.0% or better, I believe market will remain bullish for an extended period of time, possibly extending the move through next week.

    Pre-news Consideration
    There is no pre-news consideration for this release today.

    Definition
    GDP is defined as “the market value of all final goods and services produced within a country in a given period of time. It is also considered the sum of value added at every stage of production of all final goods and services produced within a country in a given period of time.” GDP is the basically direct measure of the economy’s health, and a stronger GDP means that the central bank will more likely to raise interest to curb inflation.

    Historical Chart and Data for UK Prelim GDP q/q



    Thanks,


    [​IMG]
     
    #1 Henry Liu, Apr 26, 2011
    Lasted edited by : Sep 8, 2016

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