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Forex Signal (Wednesday August 4, 2011 - 7:00am NY Time EDT) - UK BOE Interest Rate

Discussion in 'Current Forex Trading Signals' started by Stavro D'Amore, Aug 3, 2011.

  1. Stavro D'Amore

    Stavro D'Amore Former FPA Special Consultant

    Joined:
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    BOE Interest Rate
    Forecast: 0.50%
    Previous 0.50%
    Pair to trade: GBP/USD
    Triggers we need: 0.25 BUY/ -0.25 SELL


    Economical Impact: High
    Typical Result: Actual forecast is good for the currency
    Occurrence: Released monthly

    About our Triggers
    :
    It is unlikely the BOE will hike rates to 0.75%. We will BUY GBP/USD as per my method of trading below.
    The same rule will apply if the BOE suddenly decides to lower the rate, which is very highly unlikely. Should the BOE decrease rates, please look for a short term possible SELL of the GBP/USD pair.

    If our tradable releases are reached, there is a good expectation that the market will move 60-70 pips within 2 spikes in the first 15 minutes, after news release.

    Why do we care?
    Short term interest rates are the key factor in currency valuation - traders look at most other indicators merely to predict how rates will change in the future.

    Method to trade this: Stavro D’Amore Trading Method
    Don’t be a fool and trade this news prior to the rate decision release, as a no change or zero deviation is already factored in.

    I would recommend spike trading as the best 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.

    I will look for a 30% retrace 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 level looking at a 15 minute time frame. If my triggers are hit, I will definitely try to run this for over 120 minutes, depending on current market volume and to do this I will look for a choppy volume (if you’re using MT4 you would look for the volume bar tab).

    Should there not be a retrace in the original spike, I will wait for a retrace in the second spike, the time frame I will look at on the charts will be set on 5min.

    Historical Chart and Data for UK BOE Interest Rate

    What is UK BOE Interest rate?
    Members vote on where to set the rate. The individual votes are published 2 weeks later in the MPC Meeting Minutes. Interest rates are the key factor in currency valuation, it controls consumer spending and has a ripple effect on retails spending, housing and just about every sub economy.

    All the best

    Stavro D’Amore
     
    #1 Stavro D'Amore, Aug 3, 2011
    Lasted edited by : Sep 8, 2016

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