GBP Lower on BOE Rate Cut Speculation: Trading Strategies | Forex Trading | Traders4Traders

hi there Traders this is Brad good with today's trading action now just bit of a quick recap the bank of England vote count right whether they're going to change rates or not changed from a 81 to a 72 now that is a sign that they are getting closer to changing rates right this is important uh because it leads us into the next big move and out of all the central banks I think Sterling now you got to start focusing on Sterling because it is starting to rock the house giving us very clear Direction uh the central bank is running towards cutting rates and you can see here Sterling oie down Sterling kiwi down now I think Sterling yen is a target for us because I know it's sort of been going up with the Yen um you know dropping off the face of the Earth but it will kick in at some stage and the back of Japan are going to have to come out and give it another push that could be something to look for Euro Sterling starting to go up again Sterling Swiss down and we're starting to see Sterling CAD roll over now why am I going through all this stuff because straight after a central bank uh announcement right you get the initial sort of um feeling for what they're doing what the plan is and all these components now you add in there the upcoming economic data and this is the best time to strike right because we know exactly the momentum how Sterling is positioned so today's UK data is definitely massively on the radar GDP numbers for sure for me the main one here is manufacturing production numbers okay now there are some construction numbers there as well but this number here has always been a bit of a head kicker so I'll be watching that very closely um you've got their uh one of their analysts talking as well so just keep an eye on that an ECB monetary policy accounts and that's followed up with the Canadian employment numbers so quite a few opportunities now you don't have to go chasing trouble the what I'm trying to say is with the Sterling numbers at the moment because of what happened yesterday from the bank of England right we do have clear Direction in Sterling so it makes it easier to jump onto these onto these trading opportunities if the if the GDP numbers and the manufacturing output numbers come out weaker well the market will be factoring in a cut earlier than August right a 0.25% was facted in August they're already bringing that forward weekly numbers now is the perfect time for it hit the the uh Sterling and you'll see it uh drop off especially against the crosses right because when we start to look at Sterling against the dollar right well it actually sort of distorts things somewhat because if I just come back to the major currencies there uh we had you uh us jobless claims number like the weekly jobless claims number there was a spiking claims which follows the wig non-farm payroll so you know what the dollar is starting to drift lower and that that pushes Sterling up against the dollar right so really knowing what to trade because Sterling against the dollar is going up I wouldn't be looking for trouble take the US dollar out of the picture and then go from there now dollar cab will be in the framework obviously with the employment numbers uh you just need to sort of keep track of what they are and I'll give you a look at the uh what the expectations are so just look coming back to Sterling and the clocks have just reset right so you you don't get a a true picture of what's going up what's going down today make sure you follow what Sterling's doing to me Sterling against the dollar will be the only Sterling pair that's really going up okay but we'll see closer to the event we've got a bit of a risk on profile here at the moment so Euro Sterling o e kiwi against the dollar is going up and the dollar is going down so that's that's good I like the fact that Sterling is going up a little bit against the crosses it won't do much right it won't go up very far but if it does it says us up to get short at better levels if the data comes in weak all right now all right let's just have a look now at the uh the data here I just come back across right so we got the numbers coming out if I just go to new give you a bit of a look here at the ranges this is the most important aspect you need to be following uh manufacturing output right this is uh what I was talking about Min -7 + one and the forecast there is min -.4 it's absolutely key that you're all over that obviously the GDP numbers are you know they are usually a really important number to me it's more the uh sort of the second tier numbers which are really coming into play and there's that Chief Economist pill he is speaking but the text was released on uh Thursday and if I just scroll down just to touch more you'll get the uh Canadian employment numbers right these numbers are the same released the same way as the Aussie employment numbers the range here for the change 28 to 10 and 18 right so B of Canada what do we need here to get Canada sort of falling would be a number below 10 right weak weaker employment numbers it start like what we're starting to see is finally a shift in the US numbers and all the other numbers so I can see a situation where we're going to have a bunch of central banks all coming out prepared to start cutting rates and getting active and they that means good trading opportunities for us uh the unemployment rate just keep an eye on that 6.2% any sort of blowouts and weaker change uh would lead to the Cana Canadian dollar going down so dollar going up against it but all the cad crosses getting hit there as well now don't forget full-time employment is a more meaningful number than the part-time right so if you are looking at various aspects and trying to weigh that up make sure you understand what we're doing there so big day on the cards we've got uh clear Direction in Sterling right at the moment the market can this is what I'm talking about the market cannot be confused with what is going on in Sterling at the moment because it's clear as day uh from the bank of England um meeting exactly what they're doing and what they're looking for so make sure you focus in on uh Sterling if you get a chance today it could be a good chance to get into that short short trade if the data comes out stronger well it doesn't change the picture for the bank of England uh you may see a bit of retracement could be a short-term trade there but the better trade definitely with the current weakness in Sterling and that's what I'll be focusing on all right guys have a good uh trade day all the best cheer all