November 5, 2012
RBA (Reserve Bank of Australia) is expected to keep its borrowing costs unchanged at 3.50% as per general market consensus, this is following last meeting’s decision to also keep the rates unchanged…
Here´s the forecast for this news release:
10:30pm (NY Time) AU RBA Rate Decision Forecast 3.00% Previous 3.25%
DEVIATION: 0.25% (SELL AUD 2.75% / BUY AUD 3.25%)
10:30pm (NY Time) AU RBA Rate Decision Forecast 3.00% Previous 3.25%
DEVIATION: 0.25% (SELL AUD 2.75% / BUY AUD 3.25%)
Definition:Australian interest rate is often refers to as the “cash rate target”, also called the official cash rate (OCR) or cash rate. This is the Australian base rate. Banks pay this interest rate when they take out a loan with a maturity of 1 day from another bank. By buying or selling bonds and other securities issued by the government the RBA can influence the money supply and thus the cash rate target. A rise or fall in the cash rate often also leads to a change in the interest rates for mortgages, loans and savings.
The Trade Plan
If RBA decides to cut interest rate, we will stay out… If RBA decides to keep rates unchanged, we’ll BUY of AUD as market expects a cut. Ultimately we are neutral to slightly bullish on the AUD as AUDUSD has risen from recent low levels and could continue after today’s rate decision, especially considering the potential for more economic stimuli from China. With China likely to cut its RRR or benchmark interest rate soon, RBA has slight higher probabiliby of an upside move after the decision today, regardless of the outcome…
If RBA decides to cut interest rate, we will stay out… If RBA decides to keep rates unchanged, we’ll BUY of AUD as market expects a cut. Ultimately we are neutral to slightly bullish on the AUD as AUDUSD has risen from recent low levels and could continue after today’s rate decision, especially considering the potential for more economic stimuli from China. With China likely to cut its RRR or benchmark interest rate soon, RBA has slight higher probabiliby of an upside move after the decision today, regardless of the outcome…
Recommended Pairs : AUDUSD , GBPAUD, AUDJPY
AUD / USD - Australian Dollar / U.S. Dollar
Resistances
: Weekly 1.042 ; Daily 1.0395 ; Hourly 1.0365
Supports : Weekly 1.0235 ; Daily 1.0305 ; Hourly 1.033
THE BEST OF MUSIC
THE BEST OF BOOKS
Currency Trading and Forex 100 Success Secrets - 100 Most Asked Questions on Becoming a Successful Currency Trader - Frank Brill - EUR 14,73
Currency Trading in the Forex and Futures Markets - Carley Garner - EUR 28,69
Carley Garner has created the perfect book for anyone
interested in getting started in currency trading. Whether you are an
experienced trader of stocks or options looking to diversify markets you can
trade or you are completely new to trading in general this book will get you on
the right path very quickly.
The book warns novices of both the dangers and possible rewards of trading currencies. "The goal is to give you a realistic idea of what to expect in order to avoid becoming a statistic".
The author takes you through currency trading step by step from understanding the difference between FOREX and currency futures to how to trade them. The reader will get an understanding of each currency pair and a table with each three letter abbreviation for currencies and the order in which they are paired. You are advised to stick with the currency 'majors' for liquidity and avoid the 'minors' so you are not hurt with the wide bid/ask spreads in low volume markets.
Currency pair values per contract are $100,000 per standard contract, $10,000 per mini contract, and $1,000 per micro. The book also has a table for currency futures contracts.
While FOREX traders are able to leverage their trades with 50 to 1 margin the author warns traders about the dangers of leverage and how it can wipe out your account. There is always an equal downside risk for every possible upside profit with leverage and currency traders would be wise to trade appropriate position sizes that does not put their entire account at risk in one trade.
Carley warns readers that many FOREX brokers that claim to be commission free are really just taking the other side of your trades as off exchange trades instead of executing your trades on the open market like currency futures brokers do through a centralized and regulated exchange. Many FOREX brokers make their money through the bid/ask spreads that you buy and sell at when getting in and out of trades. Also FOREX trading has counter party risks while currency futures trading is guaranteed by the exchange to make all parties whole.
"FX and futures traders are not buying or selling an asset; instead they are trading a liability that is dependent, or derived, from the value of the underlying asset; thus, they are known as derivatives."
She also covers different technical indicators to use in your trading and how they measure price to give buy and sell signals. You will also get the basic styles of trading and what usually works in the currency markets.
I strongly advise any trader interested in trading currency markets to first read this book by Carley Garner before you venture into those waters.
The book warns novices of both the dangers and possible rewards of trading currencies. "The goal is to give you a realistic idea of what to expect in order to avoid becoming a statistic".
The author takes you through currency trading step by step from understanding the difference between FOREX and currency futures to how to trade them. The reader will get an understanding of each currency pair and a table with each three letter abbreviation for currencies and the order in which they are paired. You are advised to stick with the currency 'majors' for liquidity and avoid the 'minors' so you are not hurt with the wide bid/ask spreads in low volume markets.
Currency pair values per contract are $100,000 per standard contract, $10,000 per mini contract, and $1,000 per micro. The book also has a table for currency futures contracts.
While FOREX traders are able to leverage their trades with 50 to 1 margin the author warns traders about the dangers of leverage and how it can wipe out your account. There is always an equal downside risk for every possible upside profit with leverage and currency traders would be wise to trade appropriate position sizes that does not put their entire account at risk in one trade.
Carley warns readers that many FOREX brokers that claim to be commission free are really just taking the other side of your trades as off exchange trades instead of executing your trades on the open market like currency futures brokers do through a centralized and regulated exchange. Many FOREX brokers make their money through the bid/ask spreads that you buy and sell at when getting in and out of trades. Also FOREX trading has counter party risks while currency futures trading is guaranteed by the exchange to make all parties whole.
"FX and futures traders are not buying or selling an asset; instead they are trading a liability that is dependent, or derived, from the value of the underlying asset; thus, they are known as derivatives."
She also covers different technical indicators to use in your trading and how they measure price to give buy and sell signals. You will also get the basic styles of trading and what usually works in the currency markets.
I strongly advise any trader interested in trading currency markets to first read this book by Carley Garner before you venture into those waters.
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