UK Prelim GDP is the probably the most important of the GDP releases out of the three since it’s the first look at Q3 of 2014. Seeing that the BOE has been rather neutral lately, today’s release could again stoke expectations for a sooner than later rate hike (or vice versa).
4:30am (NY Time) UK Prelim GDP q/q Forecast 0.7% Previous 0.9%
DEVIATION: 0.3% (BUY GBP 1.2% / SELL GBP 0.6%)
The Trade Plan
Since this is the first release of the third quarter GDP for 2014 (Q3 2014), we´re likely to get a huge reaction if we get a surprise today, as most first releases are what the market looks to. Considering the recent negative trend in the Retail Sales figures, we may get an downside surprise release today.
However, we´ll still be looking to trade the release using our after news retracement method. Our surprise factor is around 0.3% as we´ll look to possibly SELL GBP at 0.6% or worse, and BUY GBP at 1.2% or better.
Historically, if there is a 80% of chance that our S. Factor hits, the market will move up to 50~70 pips within the hour as GDP is a very high impact report.
For more information on my news trading methods: https://www.currencynewstrading.com/how-to-get-started-with-news-trading/
I’d recommend to use the Recommended Pairs from above as they are based on my CSM, which should provide the best combination of currency pairs to trade based on better/worse news… of course, you can also trade the default pair: GBPUSD.
Outlook score is derived from market sentiment, focus, and economic indicators for the currency. It represents the long-term trend of the currency and its market perception. In short, a strong Outlook Score means more long-term demand for the currency, and a weak Outlook Score is the opposite.
Prelim GDP q/q from UK, is defined as “the market value of all final goods and services produced within a country in a given period of time. It is also considered the sum of value added at every stage of production of all final goods and services produced within a country in a given period of time.” GDP is the basically direct measurement of the economy, and a stronger GDP means that the central bank will more likely raise interest rate as better economy usually brings higher inflationary pressure…