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AUDUSD Intra-Day Fundamentals - Private Capital Expenditure and 81 pips price movement

28 May 2015, 07:46

Sergey Golubev

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2015-05-28 02:30 GMT (or 04:30 MQ MT5 time) | [AUD - Private Capital Expenditure]

past data is -1.7%
forecast data is -2.3%
actual data is -4.4% according to the latest press release

if actual > forecast (or previous data) = good for currency (for AUD in our case)

[AUD - Private Capital Expenditure] = Change in the total inflation-adjusted value of new capital expenditures made by private businesses. It's a leading indicator of economic health - businesses are quickly affected by market conditions, and changes in their investment levels can be an early signal of future economic activity such as hiring, spending, and earnings.

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The trend volume estimate for total new capital expenditure fell 2.3% in the March quarter 2015 while the seasonally adjusted estimate fell 4.4%.
The trend volume estimate for buildings and structures fell 3.7% in the March quarter 2015 while the seasonally adjusted estimate fell 6.5%.
The trend volume estimate for equipment, plant and machinery rose 0.7% in the March quarter 2015 while the seasonally adjusted estimate fell 0.5%.

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AUDUSD M5: 81 pips price movement by AUD - Private Capital Expenditure news event:

#audusd, fundamental analysis, Private Capital Expenditure

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Sergey Golubev 2015.05.29 08:39 #1

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Press review

Sergey Golubev, 2015.05.29 10:37

Trading News Events: U.S. Gross Domestic Product (GDP) (based on dailyfx article)

A marked downward revision in the preliminary 1Q U.S. Gross Domestic Product (GDP) report may drag on the greenback and spur a near-term rebound in EUR/USD as the Federal Reserve looks to carry its zero-interest rate policy into the second-half of 2015.

What’s Expected:

Why Is This Event Important:

Even though the Fed pledges to look past the economic weakness drive by transitory factors, a larger-than-expected contraction in the growth rate may spur a further delay in the central bank’s normalization cycle as it undermines expectations for a stronger recovery.

Nevertheless, increased business outputs paired with the expansion in private-sector credit may offer a better-than-expected GDP print, and prospects for a stronger recovery may spur a bullish reaction in the dollar as the Fed remains on course to remove the zero-interest rate policy (ZIRP) in 2015.

How To Trade This Event Risk

Bearish USD Trade: Growth Rate Contracts 0.9% or Greater

Need to see green, five-minute candle following the GDP report to consider a long trade on EURUSD.
If market reaction favors a short dollar trade, buy EURUSD with two separate position.
Set stop at the near-by swing low/reasonable distance from entry; look for at least 1:1 risk-to-reward.
Move stop to entry on remaining position once initial target is hit; set reasonable limit.

Bullish USD Trade: 1Q GDP Report Exceeds Market Forecast

Need red, five-minute candle to favor a short EURUSD trade.
Implement same setup as the bearish dollar trade, just in reverse.

Potential Price Targets For The Release
EURUSD Daily

Failure to preserve the near-term downward trending channel may generate a larger rebound in EUR/USD and spur a consolidation phase in the days ahead.
Interim Resistance: 1.1180 (23.6% expansion) to 1.1210 (61.8% retracement)
Interim Support: 1.0790 (50% expansion) to 1.0800 (23.6% expansion)

4Q 2014 U.S. Gross Domestic Product (GDP)
EURUSD M5: 19 pips price movement by USD - GDP news event:

Even though the preliminary 4Q U.S. GDP print was revised down to an annualized 2.2% from an initial forecast of 2.6%, the print still managed to exceed market expectations for a 2.0% rate of growth. At the same time, Personal Consumption was also revised down to 4.2% from 4.3%, while the core Personal Consumption Expenditure (PCE) remained unchanged at 1.1% during the same period. The better-than-expected GDP reading may keep the Fed on course to normalize monetary policy in 2015 as the central bank anticipates a stronger recovery in the year ahead. The greenback strengthened following the report, with EUR/USD slipping below the 1.1200 handle to end the North American session at 1.1189.