Forex Trading Signals by Magister Pips, 2012/01/31
0830 CAD GDP m/m (+0.2% exp, 0.0% prior, -0.2% to +0.3% range ) most +0.1 to +0.3
Top Analysts: 1st +0.3% 2nd +0.3% 3rd +0.2% 4th +0.1%
Affliated News Releases at 08:30 :
CAD GDP y/y (+2.3% expected, +2.7% prior, +2.2% to +2.5% range ) only 5 estimates
CAD Industrial Product Price MoM (-0.1% exp, +0.2% prior, -0.5% to +0.5% range)
CAD Raw Materials Price Index (0.0% exp, +3.8% prior, -1.0% to +2.3% range)
Last month's -0.1 deviation only brought choppy price action althought the USDCAD did drift
upward somewhat over the next few hours, but only 15-20 pips. It came out at the same time
as a slew of US data including Durable Goods, Core PCE & Personal Spending/Income which were
mixed. The YoY figure was flat and no revisions on either. In November a -0.1% deviation on
MoM again but this time the previous month was revised up +0.1% so flat overall, however the
YoY figure did print +0.3% higher. This time there was a strong move down in USDCAD showing
Canadian Dollar strength, however in November the Quarterly GDP Annualized figure came out as
well and was +3.5% above the +3.0% expected. This only comes out every 3 months and it will
come out next time on March 3rd 2012. So we have to disregard this release in terms of what
to look for on the MoM figure. October 2011 brought a +0.1 on MoM with +0.1 revision and +0.2
on YoY with +0.1 revision which again lead to choppyness although USDCAD did move down leading
into the NY open where it jumped above pre-release. So many small deviations so we have to go
back to July 2011 to find a -0.4% deviation on MoM (-0.3% actual vs +0.1% expected) along with
a -0.6% deviation on the YoY (+2.2% acutal vs +2.8% expected). The USDCAD rallied on these
weak numbers some 70-80 pips over the next half hour, with only a small 15 pip pullback 6 minutes
after the release for any afterspike entries. So a +/-0.4 deviation has a good probability of
working, +/-0.1 is too little and +/-0.2 leads to choppyness and is not reliable. There is no
recent example of a +/-0.3 deviation, but it probably should be enough to get a decent trade,
but safest is to stick to +/-0.4. This time there is no US data at the same time, so you just
have to check the YoY and revisions for any conflicts. The more they all deviate positively or
negatively the better potential a trade has for a nice move.
If it comes out at +0.5% or higher, USD/CAD should drop 30-40 pips.
If it comes out at -0.2% or lower, USD/CAD should rally 30-40 pips.
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