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Forex Signal (Wednesday November 2, 2011 – 8:30PM EDT) – AU Retail Sales m/m

Discussion in 'Current Forex Trading Signals' started by Stavro D'Amore, Nov 2, 2011.

  1. Stavro D'Amore

    Stavro D'Amore Former FPA Special Consultant

    Jul 29, 2011
    Likes Received:
    Retail sales coming from the land down under so see my trade plan below.

    AU retail Sales m/m
    Forecast 0.5%
    Previous 0.6%
    Pair to trade: AUD/USD

    Numbers we need:
    BUY AUD/USD 0.8%
    SELL AUD/USD 0.2%

    Economical Impact: High
    Typical Result: Good for Currency
    Occurrence 30 days after the month ends
    Spike Probability: Good, we can see 40 pips on initial spike

    About our Triggers:
    AU retail Sales m/m is forecasted to arrive at 0.5%
    We are looking for a deviation of 0.4% either way on this trade.
    If we get 0.8% or better I will look to enter a LONG position on AUD/USD and if we get
    0.2% or worse I will go SHORT on AUD/USD.
    Should this report be triggered, we can expect to see about 40 pips on the initial spike. This trade will have a good chance of a 50% retrace on the initial spike

    What is it? And why does the market care?
    It's the primary gauge of consumer spending, which accounts for the majority of overall economic activity. The Retail Sales is a monthly measurement of all goods sold by retailers based on a sampling of retail stores of different types and sizes in Australia. It is an important indicator of consumer spending and also correlated to consumer confidence and considered as a pace indicator of the Australian economy.

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

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

    Please be diligent trading this report.

    Pre News trading
    Approximately 5 minutes prior to the news release I will be looking for a short term SHORT position in AUD/USD.
    I would be out of this trade 1 minute before the actual release, or to avoid any spreads that should widen.

    After Spike
    I will look for a 30% 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. Please note that Australian data is known for Latency should the spike begin and your Auto clicker has not provided a number please cancel your spike trade to avoid yourself getting caught with slippage; you will have a better chance using retracement and pre news methods.

    Historical Chart and Data for AU Retail Sales m/m

    All the best

    Stavro D’Amore
    #1 Stavro D'Amore, Nov 2, 2011
    Lasted edited by : Sep 8, 2016
  2. PipDog

    PipDog Corporal

    Jul 25, 2010
    Likes Received:
    Be Careful

    2 things to watch for. First like Stavro said, the Aussie news has a way of getting out before news wires send it. This only affects if you're setting up for a spike trade. Second, take a look at DJIA futures before this trade. It appears to me that the stock markets could be setting up for a drop and that means that the USD would be strenghtening. It actually looks like the FX markets are already hedging for a stock drop. It may not matter so much on a spike trade, as you may have sufficient time to get out, but could have some play if you intend to stay long AUDUSD for some time. On the other hand, if futures are negative and we get a bad number from the Aussies...may be a chance to grab hundreds of pips on a portion of a short bet.

    Good luck all!
  3. PipDog

    PipDog Corporal

    Jul 25, 2010
    Likes Received:
    In Short on the AUDUSD

    Not great news...stock futures down...in short at 1.0245. 1.0275 SL. First TP @ 1.02. From there...?

    Anyone else?
  4. PipDog

    PipDog Corporal

    Jul 25, 2010
    Likes Received:

    Bought back 2 lots at 25 pips profit (1.0220)...TP 1.02 and SL breakeven (1.0245) on 1 lot, TP @ 1.0135 SL 1.0275 on 1 lot.

    If you're short...this could be a good runner.

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