Pro Forex Secrets Predicting News Trading ( Currency Strength Trend )

10 minutes from News in NZD

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NZD RESULT CONFIRMS PREDICTION

GBP/NZD max drop was more than -60 PIPs and
EUR/NZD was -50 PIPs .

Both of these settled midway, but there was
definitely a nice “snap scalp” to be had.

This illustrates how the method does well at predicting
where the target Currency NZD is "planning to move"
on the News. :slight_smile: So that’s a moderately good Boo-Yah…

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NZD BUSINESS CONFIDENCE

Looking at the Big Picture for the past 6 weeks in NZD, we
note that it has steadily gained, and is at the top of its
6 week range:

But we will look at other factors when evaluating a
shorter term “news scalp”… The event is 7 hours
away at 0:00 GMT Thursday

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NZD POSITIONED TO DROP ON NEWS

Based on 24 Hours Divergence view, we can see that
NZD is well positioned to DROP (be devalued)
on the upcoming News Event. :wink:

The event is coming in 7 hours from now; and we
could also consider a Currency to Pair against NZD
for the best theoretical profit potential.

We would anticipate SELL NZD, which means to
Sell NZD/xxx Pairs, and/or Buy xxx/NZD Pairs.

[EDIT] the horizontal colored lines should be ignored on
these Divergence Charts, by the way… they should
not be there, but are easily ignored.

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NZD, HOUSTON WE HAVE A PROBLEM

In the run-up to the event, NZD’s indications have
become ambiguous, so NO TRADE prediction.

Abort the launch ! LOL

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NZD, WHAT ACTUALLY HAPPENED

Since NZD had failed to validate the original prediction,
the trade was aborted. But what actually happened?

[EDIT] another Standard View of the “unknown event”
which disrupted our prediction:

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PREDICT AUD ON TUES. DEC 3 AT 03:30 GMT
BANK RATE DISCLOSURE NEWS EVENT

Here’s a tough prediction during the Holiday period, and
so let’s take on the challenge of predicting where AUD
will move on the News. We are currently 18:00 GMT on
Monday, so the News Event is more than 9 hours away.
( 18:00 plus 6 hours plus 3.5 hours away )

Our preliminary prediction is that AUD will be devalued on
the News, since its positioning recently is higher, near the
top of the 2 week range. But we’ll take some additional
confirmations nearer to the event itself.

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AUD UPDATE 01:15 GMT

The AUD situation remains essentially as before, so the prediction
of a drop in AUD on the Rate decision remains in force. A quick glance
at Divergence over the past 12 hours confirms AUD (gold color)
continues to position higher. So the prediction remains the same.

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AUD FINAL RESULT WAS A MISS ON EXPECTATIONS

Now you get to see a prediction which did NOT happen.
The Market was clearly preparing for a Rate Drop, but the
Rate held. Therefore, we missed on our prediction, because
the Market missed on its expectation.

AUD/USD lifted about 20 PIPs.

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AUD on GDP Results

We see the pronounced rise in AUD ahead
of the news. AUD/USD dropped 20 PIPs.

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BANK OF CANADA RATE DECISION (unchanged)

The 6 hour Divergence view shows CAD Market valuation
declining ahead of the decision, and the predictable LIFT
in CAD on the News Event.

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EUR POSITIONED TO RISE ON GERMAN FACTORY ORDERS

In just under 90 minutes from now.

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CAD IVEY PMI PREDICT DOWN


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EUR OUTCOME WAS AS PREDICTED

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CAD IVEY PMI NEWS OUTCOME

Interestingly, as you an see, CAD declined ahead of the News
and then did nothing on the actual News Event. We see this at times,
where peak Pricing for CAD is available ahead of the event, and
then disappears on the actual event.

So, a twist on the usual prediction, but the direction was correct.
News itself was favorable to CAD, so devaluation on the event
did not occur.

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EMPLOYMENT NEWS RESULT, BOTH CAD AND USD

Market expectation, shown here through the “bias” of CAD, and
also USD was correct. CAD positive bias, resulted in dramatic
drop in CAD. USD negative bias, resulted in dramatic rise
in USD on Employment News.

NOTE: this is 24 Hour Divergence, confirming Market preparation
for the events was at least 12 hours in advance ! :slight_smile:

[EDIT] Seen through the lens of 72 Hour Standard Charting,
we see that “bubbles” were resolved on Employment News
for both USD and CAD, shown here:

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FOMC event Wed. 19:00 GMT (3 hours away)
…current time is 16:00 GMT prior to the News Event

What/how are we predicting? In general, for a short term held
position, we predict a short term DOWN valuation of USD
back toward the lower bound of the range as seen below:

We note that USD “gapped up” in valuation on the start of this
trading week. We will “fade” that gap as our expectation, and
SELL USD short term.

[edit] longer term, I’d predict a RISE in USD to the midpoint of the
range marked.

[edit] we also have access to very short term information in
6 hour Divergence, which (at this time 2.5 hours early)
shows a down-positioning, compatible with a short term
UP move… This should determine our short term trade
just prior to the FOMC announcement

FINAL UPDATE [edit] Micro picture aligns with the Macro Range picture,
notwithstanding the “gap up”; so WE BUY USD with the following indication evidence:

[edit] FINAL RESULT
ESSENTIALLY A NON-EVENT with EUR/USD moving in only
a 10 PIP range from post News to rollover. Here’s what USD did,
with only a slight weakening, but USD did move precisely to the
bottom of its prior range:

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EUR POSITIONED TO DROP ON NEWS
European Monetary Policy and Rate decision
12.45 GMT in 5 minutes time…

[edit FINAL] not claiming this one as a victory, given the
non-reaction of EUR on the News, plus the wait for the
ECB Press Conference where Lagarde spoke for the
first time… However, what did happen was firstly a slow
decline of EUR to support, and then a slow and
hesitant rise of EUR after reassurance from Lagarde.
Europe is as stagnant as could possibly be, with
interest rate of zero and, as in the U.S. a desperate
need to get some inflation growth into the economy.

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PREDICT WEAKENING OF USD ON CORE RETAIL NEWS

Event is 5 minutes away…

[edit] prediction is correct. EUR/USD immediately moved up
by 6 PIPs. So this is a very sensitive measure, and the
moves can potentially be small. A Binary Option can help
with sensitivity of outcomes. :slight_smile:

[edit2] Actually the USD Core Retail Sales were weaker than
expected. So USD should have reacted more than it did.
However, it’s a Friday, and often expected moves are
muted on a Friday. So why didn’t USD weaken as much
as expected? And it was expected by the market. Well,
sometimes stuff just happens :slight_smile: LOL There will be a
more sustained reaction no doubt over the next couple
of hours. That’s Forex trading, Traders ! :slight_smile:

[FINAL ANALYSIS] and perhaps the correct explanation.
Here we see that the UK Conservative election depressed
the trading valuation of USD and that its continued very
slow revaluation is the reason that Core Retail weakness
did NOT depress USD as expected… Hey, it’s a learning
experience !

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SENSITIVITY OF BINARY OPTIONS IN MINOR BUBBLES

We are predicting a minor “bursting” of a CAD bubble seen here:

The News Event is in 15 minutes from now.

I will use a CALL on USD/CAD which should RISE on the bursting
of this minor CAD bubble.

[edit] The market expected to drop CAD; however, the results came
in at 11 billion versus forecast 5 billion. THIS WORKS AGAINST OUR
EXPECTATION that CAD will drop. HOWEVER having distorted CAD
upwards, there is still a market desire to drop the CAD and “take
profits” on the bubble. This is an interesting feature of this method
of News Event trading using Currency Trending. Even with adverse
News (opposite of Market expectation), we may still see a move in
our predicted direction ! My CALL options were WINs due to this
effect, and moves in USD/CAD were inside a 3 PIP range !

Here is what happened to the CAD:

As you can see, CAD weakened very slightly, but just enough to
WIN my CALL option on USD/CAD even though total excursion of
USD/CAD was no more than 5 PIPs… :slight_smile:

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