Trading Signals and News Update For Thursday

1. Thursday, October 4th, 2007 (7:00 a.m. New York Time) UK
At 7 a.m. New York time we will have UK interest rate decision. It is expected that they will hold the rate at 5.75%. If for some reasons they will hike it to 6.00%, GBP/USD may possibly gain 100 pips or more in the first hour of the report. If for some reasons they will cut the rate to 5.50%, GBP/USD may possibly go down by 100 pips or more in the first hour of the report. Such scenario is extremely unlikely. Watch for some comments out of UK, if there are any. If the UK government is dovish, and they mention anything about possibility of cutting rates in the future, expect GBP/USD to drop by 80 pips or more in the first hour of the report. On the other hand, if they talk about a possibility to hike the rate in the future, GBP/USD may go up by 80 pips or more in the first hour of the report.

2. Thursday, October 4th, 2007 (7:45 a.m. New York Time) EURO ZONE
At 7:45 a.m. New York time we will have Euro zone releasing their interest rate statement. It is expected they will hold the rate at 4.00%, same as last month, and if for some reasons they will hike the rate to 4.25%, EUR/USD may possibly gain 70 pips or more in the first hour of the report. If there is a surprise cut to 3.75%, EUR/USD may possibly go down by 70 pips or more in the first hour of the report. It is extremely unlikely they would cut a rate because Euro zone is still on the hiking spree. Also, there is going to be no speech; Trichet actually will be speaking at 8:30 a.m. New York time which is 45 minutes later.

3. Thursday, October 4th, 2007 (8:30 a.m. New York Time) EURO ZONE
At 8:30 a.m. we will have Trichet speech out of Euro zone. That speech may be a little bit too complicated to trade so I am not going to tell you how to do it. However, be very careful with your own trades at that moment as you may see some price actions that will affect all currencies against the Euro. At 8:30 a.m. I would just stay out of the market unless you really know what you are doing.

That's is all for Thursday.

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