Profit Mongers @ 1:29 AM, Tuesday July 27 2010
Hey folks,
EUR/USD traded subtlely but brilliantly yesterday during the European session topping out right at 1.2958 for the short term sell I mentioned, and also bottoming out hours later in the 1.2880's for a potential buy. With the break of 1.2966 though, the odds have risen the EUR/USD has the potential to burst up through 1.3026 to new highs. For now I am neutral, but should we get a convincing break out high, I'd wait for a pullback down to the 1.3000-1.3030 region to get in long along with the momentum. A double top here around 1.3000 is always a possibility, but the patterns playing out right now make it more of a longshot than usual.
USD/JPY managed to dip a bit fortunately yesterday, so if you're still in short you've gotten a bit of a windfall and can exit at a bit of a better spot than I did yesterday. The odds of a 100+ point rally still outweigh the odds of a 100+ point selloff, so I'd consider closing any shorts and going long from here (around 86.96) with an 80-100 pip SL and 100-200 pip TP.
Stocks pushed higher as I forecasted in yesterday's signal. Time and projection analysis seems to suggest we should top out around 1130 over the course of the next 1-2 weeks, so with a high of 1115, that would suggest a bit more sideways action with supporting strength for the rest of the week. With that in mind, I plan to buy around 1000 on the S&P futures with a 10-15 point SL and 15-25 point TP.
In news Monday, we have 2 reports to look forward to:
1000 US Consumer Confidence (52 expected) - This report is usually good for a steady 30-40 pips on USD/JPY when the trigger is hit.
If it comes out at 59 or higher, USD/JPY should rally 30-40 pips.
If it comes out at 45 or lower, USD/JPy should fall 30-40 pips.
2130 AU CPI Trimmed Mean q/q (0.8% expected) - This report is usually good for 40-50 pips on AUD/USD, and while 0.2% should work, 0.3% will be a lot safer. Stay away from conflicts as well... the Trimmed Mean number seems to be the most important, but all 3 CPI figures out of Australia still carry some weight. Sometimes we'll get a sharp spike for 40+ pips and that's all we'll really see... other times we'll get an underwhelming move on the spike (25 pips or less), but it turns into a pretty decent trend for an hour or two. In either case, look to get in the direction of a confirmed trigger after a decent retracement.
If it comes out at 1.0% or higher, AUD/USD should rally 40 pips.
If it comes out at 0.6% or lower, AUD/USD should fall 40 pips.
That's all for today's update. If you'd like to learn more about trading or trade along with myself and my collegues, come join us at Profit Mongers. Our subscription is very reasonable at $179 per month, and right now you can sign up for a 2 week trial to get started for only $29. This offer is for new customers only. Feel free to email me with any questions at sirpipsalot@profitmongers.com
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Sir Pipsalot
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