Daily Alert: For Thursday 3rd December 2015

Mark Nugent2015 H2, Daily Alert

Today’s slides are HERE.

Today’s Economic News

Today saw GDP of 0.9% q/q in Australia versus expectation of 0.7%. UK Construction PMI at 55.3 missed target of 58.4. This and the unfolding parliamentary debate regarding extending bombing into Syria has caused the pound to fall around 150 pips (1%) against the USD today. This is replicated across all GBP pairs today. Canadian interest rates stayed at 0.50% as expected and the statement had no surprises.

20151203Slide2 (1)
20151203Slide2 (1)

Current Trades

My EURUSD trade comes back to life with a downturn matching yesterday’s upturn. Tomorrow (1245 GMT) is a big day for the ECB: an interest rate announcement and possibly more QE. All Euro trades should be exited or stops placed to breakeven. The forecast is for a 10 basis points interest rate decrease and for a lot more QE. However, the Euro has fallen a lot recently because of this expectation, so a more modest announcement tomorrow may see a Euro rally.

20151203Slide2 (3)

Other Opportunities

The other pair to consider for a Euro weakness trade is EURGBP. Today’s GBP weakness puts this pair into a nice setup for a short, prior to tomorrow’s ECB announcement. Going in now at market is aggressive. A pending sell stop with entry somewhere on today’s candle body is more measured.

20151203Slide2 (4)

Trading NZD weakness: today’s weak GBP temps me to lower my pending entry on GBPZD to the indicated position. Stop will be 3 x ATR if not more.

20151203Slide2 (5)

The alternative trade, NZDUSD, moves into a better position but still not ideal for a long as the pair sits above both EMA lines.

20151203Slide2 (6)

I don’t see any other set-ups at the moment. Take care tomorrow during the ECB’s rate decision and press conference. Capital preservation is all important.

M1 Trades

In the end I did not trade this announcement.