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Monday Aussie News Preview 10-04-2010

Discussion in 'Commercial Trade Journals' started by Sir Pipsalot, Oct 4, 2010.

  1. Sir Pipsalot

    Sir Pipsalot Former FPA Special Consultant

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    Hey folks,

    Here's a preview of Australian news set to come out this evening:

    2030 AU Retail Sales s.a m/m (0.4% expected) - If the deviation is smaller but tradeable (close to a 0.5% surprise), often the move comes all at once and is around 30-40 pips. If the surprise is much larger around 1.0% or more away from expectations, we have a chance for a stubborn move that may stretch for 50-60 over 3-10 minutes.
    If it comes out at 0.9% or higher, AUD/USD should rally 40 pips.
    If it comes out at -0.1% or lower, AUD/USD should drop 40 pips.
    If the surprise is very large (1.4% or higher, or -0.6% or lower), AUD/USD might set up a trend in the news direction for the next 2-3 hours as traders believe the number may have influence on the RBA's tough decision.

    2330 AU Interest Rate Decision (0.25% hike to 4.75% favored) - 20/25 of economists are expecting them to hike rates after recent hawkish commentary, and markets have priced in a 72% chance of a hike as of yesterday, which might be slightly higher today. Obviously the big moneymaker here would be if they kept rates on hold as most seem to be on the rate hike bandwagon. If you look at charts for RBA Interest Rate decisions, sometimes the first minute goes the right way, sometimes it reverses, but it generally sets up into a trend that lasts at least an hour and often more.

    --If they hike rates by 0.25%, AUD/USD is likely to rally further, but I'd either get out quickly on the spike (might be 20-30 pips up), or wait for an overall up trend to establish over the course of 5-10 minutes just to be safe. The commentary on a hike could be helpful, or could create a bit of a headache for price action... you never know. Once the trend establishes, then you can use your preferred method of momentum following to get in on the action.

    --If they keep rates unchanged at 4.50%, this is the easy trade as AUD/USD should plummet hard initially for 50-70 pips and probably experience a downtrend for 1-3 hours, and AUD relative weakness overall for the next 11 hours.

    That's all for today's update. If you'd like to learn more about trading or trade along with myself and my collegues, come join us at Profit Mongers. Our subscription is very reasonable at $179 per month, and right now you can sign up for a 2 week trial to get started for only $29. This offer is for new customers only. If you have any questions, you can also email me at sirpipsalot@profitmongers.com

    To our success!
    Sir Pipsalot
     

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