Pair: GBP/USD or British Pound Futures
Result: Sell
Prior: 2.0%
Expected: 3.0%
Actual: 3.5%
A good deviation in favour of the british pound gave a sell signal and I entered the market within 1 second of the number coming out. I used british pound futures this time and the average price for my fill was 1.9522. The price moved in my favour and then retraced very sharply. Often on a sharp retrace, the price will go all the way back up and hit your stop. I don’t like my stops getting hit as I like to keep my losses small so I exited immediately and got filled on my exit at 1.9525 for a 3 tick loss.
Soon after I exited, the market continued down, however I wasn’t willing to risk it. Better to take a small loss than risk a big one with low probability.
I will continue with the futures platform for a while longer with small lots to see how I get filled. Today was not good for fills as the open price of the 0830 candle was 1.9539 and I got in at 1.9522 – 17ticks slippage.
In the screenshot below there are two tapes, the left one is all orders filled and the right one is all orders 10 contracts or higher filled. As you can see the bid/ask spread is pretty wide which explains the fills. The best bid at the time I placed my SELL_MARKET order was 1.9535 where someone got in with 6 contracts at the bid. I may consider trading the euro at news time as this is more liquid. The biggest order on the british pound was only 19 contracts as you can see from the tape.
When you look at the euro tape, things look a bit different:
Here we can see that the largest order is 70 contracts – substantially more. Check back here for more updates in the future.
Description
Gross Domestic Product (GDP) measures the total value of all goods and services produced by the economy. A rising trend has a positive effect on the nation’s currency. GDP is the broadest measure of activity and the primary gauge of the economy’s health. To foreign investors, a strong economy is viewed favorably because it spurs investment opportunities in the domestic stock and bond markets. More importantly, the central bank is more likely to raise interest rates in the face of a strong and growing economy. The combination of these effects can have a large impact on the demand for the nation’s currency.
