Press review - page 548

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Weekly Fundamental Forecast for Dollar Index (based on the article)


Dollar Index - "The best-case scenario for the greenback would see Yellen setting the stage to begin so-called “quantitative tightening” (QT) next month. That would leave room for another rate hike just before year-end if all goes well and the “idiosyncratic” forces holding down inflation evaporate, as the Fed seems to believe they will. Vague rhetoric on QT prospects and ebbing confidence in reflation are likely to hurt the US currency."

 

Weekly Fundamental Forecast for GBP/USD (based on the article)


GBP/USD - "In the coming week, the key statistic will be the second reading of second-quarter GDP, which analysts will be watching for any deviation from the first estimates of 0.3% growth quarter/quarter and 1.7% year/year. Also on the calendar are the public finances on Monday and the Confederation of British Industry’s industrial and retail surveys on Tuesday and Thursday respectively."

 

Weekly Fundamental Forecast for USD/JPY (based on the article)


USD/JPY - "The Yen weakened in the early portion of this week after this robust GDP print, and this was likely more-related to the easing of risk aversion after last week’s heightened worries around North Korea. U.S. stocks popped-higher on Monday, and held gains on Tuesday and going into Wednesday; mirroring the move of weakness in the Japanese Yen, even despite this stronger-than expected GDP report that opened the week. But after those FOMC meeting minutes were released on Wednesday, the tone changed: Yen strength showed-up again, stocks sold off, and we rallied off the lows as we move towards week-end."

 

Weekly Fundamental Forecast for USD/CNH (based on the article)


USD/CNH - "The Chinese Yuan lost against the U.S. Dollar this week, following five consecutive gains. The USD/CNH remained the bearish trend (bullish for the Yuan) amid the Dollar weakness and was testing the top 50% line of a parallel. Next week, China’s economic calendar is light; the primary external risk will come from the Jackson Hole Economic Symposium. In terms of risks from home, policies from China’s central bank as well as the development of China’s relationship with its counterparts will be top drivers for Yuan pairs."

 

USD/CAD Intra-Day Fundamentals: Canada's Wholesale Sales and range price movement 

2017-08-21 13:30 GMT | [CAD - Wholesale Sales]

  • past data is -1.0%
  • forecast data is 0.6%
  • actual data is -0.5% according to the latest press release

if actual > forecast (or previous one) = good for currency (for CAD in our case)

[CAD - Wholesale Sales] = Change in the total value of sales at the wholesale level. 

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From official report :

  • "Wholesale sales declined 0.5% to $61.4 billion in June following eight consecutive monthly increases. Declines were recorded in five of seven subsectors, led by the food, beverage and tobacco subsector and the motor vehicle and parts subsector."
  • "In the second quarter of 2017, current dollar wholesale sales increased 2.5% while constant dollar sales increased 1.7%. For both current and constant dollars, the increase in sales in this quarter was the fifth consecutive quarterly increase."

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USD/CAD M5: range price movement by Canada's Wholesale Sales news event 


 

EUR/USD - 'We Prefer to Buy' or stronger EURUSD-bullish story (based on the article)

Daily price is on bullish trend located above Ichimoku cloud: price is on ranging within narrow support/resistance levels waiting for the direction of the stronger trend to be started. 

  1. Bearish scenario. Descending triangle pattern was formed by the price together with 1.1662 support level to be crossed to below for the secondary correction to be started with the good possibility to the bearish reversal in the near future.
  2. Bullish scenario. Schaff Trend Cycle indicator is located below 20 in fully oversold level so the 1.1846 resistance is near to be expected to be broken to above for the bullish trend to be resumed.


  • "Retail trader data shows 24.0% of traders are net-long with the ratio of traders short to long at 3.17 to 1. In fact, traders have remained net-short since Apr 18 when EURUSD traded near 1.07646; price has moved 9.7% higher since then. The percentage of traders net-long is now its lowest since Aug 02 when EURUSD traded near 1.18508. The number of traders net-long is 9.1% lower than yesterday and 20.8% lower from last week, while the number of traders net-short is 19.2% higher than yesterday and 14.6% higher from last week."
  • "We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EURUSD prices may continue to rise. Traders are further net-short than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger EURUSD-bullish contrarian trading bias."

DailyFX
DailyFX
  • www.dailyfx.com
EURUSD: Retail trader data shows 24.0% of traders are net-long with the ratio of traders short to long at 3.17 to 1. In fact, traders have remained net-short since Apr 18 when EURUSD traded near 1.07646; price has moved 9.7% higher since then. The percentage of traders net-long is now its lowest since Aug 02 when EURUSD traded near 1.18508. The...
 

Spread


The forum

  • spreadometer_v2.01 indicator fixed version - the post.
  • Spread recording fail - the thread with the indicator (fixing bug thread).
  • Spread and StopLoss indicator with alert - the thread 
  • Tools to monitor spread and swap - the thread with many good tools
  • Spread monitoring and show leverage tools - the thread 
  • FunIndicator indicator - the thread (monitor spread, swap etc for many pairs in one window).
  • Meh Spread Indicator thread 

The articles

CodeBase

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Forum on trading, automated trading systems and testing trading strategies

Indicators: spread_on_chart

Sergey Golubev, 2014.01.12 08:59

What Does a Spread Tell Traders?

  • Spreads are based off the Buy and Sell price of a currency pair.
  • Costs are based off of spreads and lot size.
  • Spreads are variable and should be referenced from your trading software.

Spreads and Forex

Every market has a spread and so does Forex. A spread is simply defined as the price difference between where a trader may purchase or sell an underlying asset. Traders that are familiar with equities will synonymously call this the Bid: Ask spread.

Below we can see an example of the spread being calculated for the EURUSD. First we will find the buy price at 1.35640 and then subtract the sell price of 1.32626. What we are left with after this process is a reading of .00014. Traders should remember that the pip value is then identified on the EURUSD as the 4th digit after the decimal, making the final spread calculated as 1.4 pips.

Now we know how to calculate the spread in pips, let’s look at the actual cost incurred by traders.



Spreads Costs and Calculations

Since the spread is just a number, we now need to know how to relate the spread into Dollars and Cents. The good news is if you can find the spread, finding this figure is very mathematically straight forward once you have identified pip cost and the number of lots you are trading.

Using the quotes above, we know we can currently buy the EURUSD at 1.3564 and close the transaction at a sell price of 1.35474.That means as soon as our trade is open, a trader would incur 1.4 pips of spread. To find the total cost, we will now need to multiply this value by pip cost while considering the total amount of lots traded. When trading a 10k EURUSD lot with a $1 pip cost, you would incur a total cost of $1.40 on this transaction.

Remember, pip cost is exponential. This means you will need to multiply this value based off of the number of lots you are trading. As the size of your positions increase, so will the cost incurred from the spread.


Changes in the Spread

It is important to remember that spreads are variable meaning they will not always remain the same and will change sporadically. These changes are based off of liquidity, which may differ based off of market conditions and upcoming economic data. To reference current spread rates, always reference your trading platform.

Forum on trading, automated trading systems and testing trading strategies

Scripts: News VLine

Sergey Golubev, 2014.01.30 09:25

Forex Spreads and the News (based on dailyfx article)

  • Spreads are based off the Buy and Sell price of a currency pair.
  • Spreads are variable and can change during news.
  • Watch for normalization of spreads, shortly after economic events.

Financial markets have the ability to be drastically effected by economic news releases. News events occur throughout the trading week, as denoted by the economic calendar, and may increase market volatility as well as increase the spreads you see on your favorite currency pairs.

It is imperative that new traders become familiar with what can happen during these events. So to better prepare you for upcoming news, we are going to review what happens to Forex spreads during volatile markets.


Spreads and the News

News is a notorious time of market uncertainty. These releases on the economic calendar happen sporadically and depending if expectations are met or not, can cause prices to fluctuate rapidly. Just like retail traders, large liquidity providers do not know the outcome of news events prior to their release! Because of this, they look to offset some of their risk by widening spreads.

Above is an example of spreads during the January NFP employment number release. Notice how spreads on the Major Forex pairs widened. Even though this was a temporary event, until the market normalizes traders will have to endure wider costs of trading.


Dealing with the Spread

It is important to remember that spreads are variable, meaning they will not always remain the same and will change as liquidity providers change their pricing. Above we can see how quickly spreads normalize after the news. In 5 minutes, the spreads on the EURUSD moved from 6.4 pips back to 1.4 pips. So where does that leave traders wanting to execute orders around the news?

Traders should always consider the risk of trading volatile markets. One of the options for trading news events is to immediately execute orders at market in hopes that the market volatility covers the increased spread cost. Or, traders can wait for markets to normalize and then take advantage of added liquidity once market activity subsides.

 

USD/CAD Intra-Day Fundamentals: Canada's Retail Sales and range price movement 

2017-08-22 13:30 GMT | [CAD - Core Retail Sales]

  • past data is -0.1%
  • forecast data is 0.0%
  • actual data is 0.7% according to the latest press release

if actual > forecast (or previous one) = good for currency (for CAD in our case)

[CAD - Core Retail Sales] = Change in the total value of sales at the retail level, excluding automobiles. 

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From official report :

  • "Retail sales rose for the fourth consecutive month in June, edging up 0.1% to $49.0 billion. Sales were up in 6 of 11 subsectors, representing 38% of total retail trade."
  • "Higher sales at general merchandise stores, clothing and clothing accessories stores, and building material and garden equipment and supplies dealers offset lower sales at motor vehicle and parts dealers and gasoline stations. Excluding the latter two subsectors, retail sales were up 1.1%."

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USD/CAD M5: range price movement by Canada's Retail Sales news event 

 

AUD/USD - ranging for direction (based on the article)

Intra-day price on H4 chart is located within 100-SMA/200-SMA levels waiting for the direction of the trend to be started.


  • "The Australian Dollar has struggled to build upside momentum against its US counterpart since bouncing from rising trend support set from May/June lows. Prices seemingly completed a bullish Flag continuation pattern but have been unable even to retest the prior swing high, much less to overcome it."
  • "Resistance is at 0.7979, the 23.6% Fibonacci expansion, with break above that on a daily closing basis opening the door to challenge the 0.8066-87 area (July 27 high, 38.2% level). Alternatively, a turn below trend line support, now at 0.7859, exposes the 0.7784-0.7805 zone (38.2% Fib retracement, August 15 low) anew."

DailyFX
DailyFX
  • www.dailyfx.com
has struggled to build upside momentum against its US counterpart since bouncing from rising trend support set from May/June lows. Prices seemingly completed a bullish Flag continuation pattern but have been unable even to retest the prior swing high, much less to overcome it. Resistance is at 0.7979, the 23.6% Fibonacci expansion, with break...
 

EUR/USD Intra-Day Fundamentals: Canada's Retail Sales and range price movement 

2017-08-23 08:30 GMT | [EUR - German Manufacturing PMI]

  • past data is 58.1
  • forecast data is 57.7
  • actual data is 59.4 according to the latest press release

if actual > forecast (or previous one) = good for currency (for EUR in our case)

[EUR - German Manufacturing PMI] = Level of a diffusion index based on surveyed purchasing managers in the manufacturing industry. 

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From official report :

  • "Faster growth of manufacturing output and total new orders was reflected in a rise in the IHS Markit Flash Germany Manufacturing PMI to 59.4 in August, from 58.1 in July. This was the third-highest level in over six years."

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EUR/USD M5: range price movement by German Manufacturing PMI news event 

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