NZ Retail Sales release is a quarterly release therefore it is more likely to surprise than the monthly release, thus if we get a surprise today, especially if the surprise goes in the direction of yesterday’s RBNZ interest decision, we should see plenty of market reaction.
6:45pm (NY Time) NZ Retail Sales Forecast 1.0% Previous 0.8%
DEVIATION 0.5% (ACTION: NZD BUY 1.5% SELL 0.5%)
The Trade Plan
NZ Retail Sales release is the measurement of consumer spending in the retail sector, as it reflects the strength of the economy and the strength of consumer spending. We´ll be looking for a difference (or deviation) of at least 0.4% ~ 0.6% from the Forecasted number, therefore a positive 1.5% (or better) will be somewhat bullish signal for NZD and a 0.5% (or worse) will be a bearish signal for NZD. Our focus will be on the Headline release, not on the Core Release… However both releases shouldn’t conflict, or it will be an automatic no trade.
I’d recommend to use the Recommended Pairs from above as they are based on my CSM, which should provide the best combination of currency pairs to trade based on better/worse news… of course, you can also trade the default pair: NZD/USD.
Outlook Score
Outlook score is derived from market sentiment, focus, and economic indicators for the currency. It represents the long-term trend of the currency and its market perception. In short, a strong Outlook Score means more long-term demand for the currency, and a weak Outlook Score is the opposite.
DEFINITION
“NZ Retail Sales Measures the value of sales at the retail level. A rising trend has a positive effect on the nation´s currency because Retail Sales make up a large portion of consumer spending, which is a major driver of the economy and has a sizable impact on GDP. Traders pay close attention to Retail Sales because it is usually the first significant indicator of the month that relates to consumer behavior and is susceptible to surprises.”