Mar 16, 2017 (Thursday)
Correlation between GB Bank Rate decision and U.S. Jobless claims
Trading Plan:
1) Hold long position of Sterling. (now 5pips in green, 125pips in green including hedging)
2) Keep short scalping. (hedging purpose)
3) Seriously consider getting out of the long.
Upcoming big events are GB Bank Rate Decision 8:00am EST and U.S. Jobless claims 8:30am EST.
Both events come out on Thursday. Rate decision is monthly or bimonthly, while Jobless claims is weekly.
It seems like Rate decision is more relevant to Sterling, however, I find no significant evidence that it matters (except the rate hike/cut ones).
Adversely, Jobless claims matters more on Sterling.
Let us take a look of statistics on the 36 releases of Bank Rate decisions/Jobless claims in the past 3 years.
On average, daily volatility (high minus low) is 138pips in Bank rate days versus 123pips in normal days.
16 out of 36 times Sterling posted negative daily gain (+74pips), the rest 20 times posted daily loss (-69pips).
8 out of 36 times (22%) Sterling posted gain in the following two trading days (+91pips), the rest 28 times posted loss in the following two trading days (-81pips).
I need to seriously consider exiting the position today or tomorrow as Sterling stands higher chance to drop on/after the events.
craftsman
Correlation between GB Bank Rate decision and U.S. Jobless claims
Trading Plan:
1) Hold long position of Sterling. (now 5pips in green, 125pips in green including hedging)
2) Keep short scalping. (hedging purpose)
3) Seriously consider getting out of the long.
Upcoming big events are GB Bank Rate Decision 8:00am EST and U.S. Jobless claims 8:30am EST.
Both events come out on Thursday. Rate decision is monthly or bimonthly, while Jobless claims is weekly.
It seems like Rate decision is more relevant to Sterling, however, I find no significant evidence that it matters (except the rate hike/cut ones).
Adversely, Jobless claims matters more on Sterling.
Let us take a look of statistics on the 36 releases of Bank Rate decisions/Jobless claims in the past 3 years.
On average, daily volatility (high minus low) is 138pips in Bank rate days versus 123pips in normal days.
16 out of 36 times Sterling posted negative daily gain (+74pips), the rest 20 times posted daily loss (-69pips).
8 out of 36 times (22%) Sterling posted gain in the following two trading days (+91pips), the rest 28 times posted loss in the following two trading days (-81pips).
I need to seriously consider exiting the position today or tomorrow as Sterling stands higher chance to drop on/after the events.
craftsman
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