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Forex Signal (Wed August 24, 2011 NY TIME 6:45pm EDT) – NZ Core Retail Sales q/q

Discussion in 'Current Forex Trading Signals' started by Stavro D'Amore, Aug 23, 2011.

  1. Stavro D'Amore

    Stavro D'Amore Former FPA Special Consultant

    Joined:
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    NZ Core Retail Sales q/q
    Forecast 0.7%
    Previous 0.7%
    Pair to trade: NZD/USD


    Numbers we need: BUY NZD/USD 1.2%
    SELL NZD/USD 0.2%


    Economical Impact: High
    Typical Result: Good for currency
    Occurrence: Quarterly, about 45 days after the quarter ends
    Spike Probability: Ok but, be mindful that trade has tendency to reverse after spike

    About our Triggers:
    NZ Retail Sales q/q is forecasted to arrive at 0.7%.
    We are looking for a deviation of 0.5% on this trade.
    If we get 2.0% or better I will look to enter a LONG position on NZD/USD and if we get 0.5% or lower I will go SHORT on NZD/CAD.
    Should this report be triggered, we can expect to see about 25pips on the initial spike.

    NOTE: NZ Retail sales is also out the same time, however I do not see a risk in conflict.


    What is it? And why does the market care?
    The Core Retail Sales is a quarterly measurement of all goods sold by retailers based on a sampling of retail stores of different types and sizes in New-Zealand, excluding auto. Automobile and gas station sales account for about 20% of Retail Sales, but they tend to be volatile and distort the underlying trend. The Core data is therefore thought to be a better gauge of spending trends. This news is an important indicator of consumer spending and also correlated to consumer confidence and considered as a pace indicator of the New-Zealand's economy.

    A higher than expected reading should be taken as positive/bullish for the NZD
    A lower than expected reading should be taken as negative/bearish for the NZD.

    Method I use to trade this:
    Stavro D’Amore Trading Method
    I will look for a 50% retracement in the original spike before entering a trade if trade falls below the 50% spike I will look to go the opposite direction as this trade is likely to reverse. I will be looking at a 5 minute chart. 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 the original spike price.

    NOTE: I will not take this retracement on this trade unless our triggers are hit.

    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 to analyse this.

    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. Please use a 10pip limit order.

    Historical Chart and Data for NZ Core Retail Sales

    All the best

    Stavro D’Amore
     
    #1 Stavro D'Amore, Aug 23, 2011
    Lasted edited by : Sep 8, 2016
  2. Pranab Deb

    Pranab Deb Recruit

    Joined:
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    Regarding Strategy

    Dear Stavro D’Amore,
    I could not follow " I will look for a 50% retracement in the original spike before entering a trade if trade falls below the 50% spike I will look to go the opposite direction as this trade is likely to reverse. I will be looking at a 5 minute chart. 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 the original spike price."
    Could you be kind enough to make me understand how to apply this in the MT-4 platform.
    I shall oblige to you.
    Regards.

    Pranab Deb
     

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