May 23, 2012
Retail Sales is usually a very tradable release as traders draw direct
correlation between retail activities with economic health.
Here´s Forecast:
8:30am Core Retail Sales Forecast 0.6% Previous 0.5%
DEVIATION: 0.5% (BUY CAD 1.0% / SELL CAD 0.0%)
Definition
Our focus is on the Core Retail Sales release and not the headline Retail Sales release; Retail Sales releases from Canada is a month on month release, and basically it´s a measurement of the activities at the retail level of Canada, and the Core release is the same Retail Sales but excluding most volatile components, Automotive Components, which makes up about 25% and it varies seasonly. A better release generally means more consumer spending, which leads to better economy, thus better for its currency. And the CORE reading provides a far more accurate look of the actual economy.
The Trade PlanI´m going to be looking for a deviation around 0.4 ~ 0.6% for this news. Since the forecast is at 0.6%, a reading of 0.0% would be negative for the CAD and we´ll be looking to SELL CAD; however, if the opposite is true, or a 1.0% (or better) of actual release, I´ll be looking to BUY CAD.
Primary currency pair: USD/CAD ; AUD/CAD
Forecast: 0.5
Previous: 0.5
LT1 (Lower Trigger 1): --- [BUY]
UT1 (Upper Trigger 1): --- [SELL]
As promised, while I don't recommending trading it yet, I will provide some stats so you can make your own decision.
There are 20 estimates for Canadian Retail Sales Less Autos (Core). Median estimate is 0.5% and the average estimate is 0.5%. The highest estimate is 0.8% (two votes), and then the second highest is 0.7% (two votes). The lowest estimate is 0.3% (three votes), and then the second lowest is 0.4% (two votes). One standard deviation is 0.1%.
For the headline number (CA Retail Sales m/m), it is expected to come out at 0.3% vs. -0.2% last month. Based on 21 estimates, both median and the average estimates are 0.3%. The highest estimate is 0.9% (one vote) and then 0.8% (also one vote). The lowest estimate is -0.2% (one vote), and then the second lowest is 0.1% (four votes). One standard deviation is 0.2%.
Last month Retail Sales Core came out at 0.5 vs 0.6 expected, and the headline came out at -0.2 vs +0.1 expected, and we saw about 12 pip spike on USD/CAD, followed by additional 8 pip move for a total of 20 pip move within first 10 minutes. Pretty good.
Two months ago it came out at -0.5 vs +0.5 expected, and we saw about 10 pips spike followed by additional 15 pip move.
However, for so many months in a row we didn't see significant deviations and spikes so I don't want to make any recommendations until I see this report performing well.
It's good to know not only when to enter a trade but also when stay away. When it comes to news trading, we are looking for high probability trades.
Here´s Forecast:
8:30am Core Retail Sales Forecast 0.6% Previous 0.5%
DEVIATION: 0.5% (BUY CAD 1.0% / SELL CAD 0.0%)
Definition
Our focus is on the Core Retail Sales release and not the headline Retail Sales release; Retail Sales releases from Canada is a month on month release, and basically it´s a measurement of the activities at the retail level of Canada, and the Core release is the same Retail Sales but excluding most volatile components, Automotive Components, which makes up about 25% and it varies seasonly. A better release generally means more consumer spending, which leads to better economy, thus better for its currency. And the CORE reading provides a far more accurate look of the actual economy.
The Trade PlanI´m going to be looking for a deviation around 0.4 ~ 0.6% for this news. Since the forecast is at 0.6%, a reading of 0.0% would be negative for the CAD and we´ll be looking to SELL CAD; however, if the opposite is true, or a 1.0% (or better) of actual release, I´ll be looking to BUY CAD.
Primary currency pair: USD/CAD ; AUD/CAD
Forecast: 0.5
Previous: 0.5
LT1 (Lower Trigger 1): --- [BUY]
UT1 (Upper Trigger 1): --- [SELL]
As promised, while I don't recommending trading it yet, I will provide some stats so you can make your own decision.
There are 20 estimates for Canadian Retail Sales Less Autos (Core). Median estimate is 0.5% and the average estimate is 0.5%. The highest estimate is 0.8% (two votes), and then the second highest is 0.7% (two votes). The lowest estimate is 0.3% (three votes), and then the second lowest is 0.4% (two votes). One standard deviation is 0.1%.
For the headline number (CA Retail Sales m/m), it is expected to come out at 0.3% vs. -0.2% last month. Based on 21 estimates, both median and the average estimates are 0.3%. The highest estimate is 0.9% (one vote) and then 0.8% (also one vote). The lowest estimate is -0.2% (one vote), and then the second lowest is 0.1% (four votes). One standard deviation is 0.2%.
Last month Retail Sales Core came out at 0.5 vs 0.6 expected, and the headline came out at -0.2 vs +0.1 expected, and we saw about 12 pip spike on USD/CAD, followed by additional 8 pip move for a total of 20 pip move within first 10 minutes. Pretty good.
Two months ago it came out at -0.5 vs +0.5 expected, and we saw about 10 pips spike followed by additional 15 pip move.
However, for so many months in a row we didn't see significant deviations and spikes so I don't want to make any recommendations until I see this report performing well.
It's good to know not only when to enter a trade but also when stay away. When it comes to news trading, we are looking for high probability trades.
RESISTANCE : Weekly 1,0315 , Daily 1,0275 , Hourly 1,0235
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