Profit Mongers @ 8:44 AM, Tuesday November 01 2011
1000 US ISM Manufacturing Index (52.0 expected, 51.6 prior, 50.5 to 55.0 range)
Affliated Reports:
US ISM Prices Paid (55.0 expected, 56.0 prior, 51.0 to 57.0 range)
Last month this came out with a small +1.1 deviation and this indicator has been consolidating just
above 50 level which was broken in September at 48.5 Above 50 is expansion and below is contraction.
Another print building on the past 2 months rebound will help market confidence. In August a -4.2
deviation spiked the USDJPY down about 30 pips in the 1st minute or 2, retracing about 50% after 3
minutes in a volatile whipsaw price action before downward pressure was again exerted driving this
pair to a 45 pip move 11 minutes after the hour. The broad market did move from this one thou as
Risk Aversion gripped, so any FX pair or stock index future or Risk fueled financial instrument did
move well. The EURJPY did move down 120 pips in the same 11 minutes, the AUDUSD did have a nice 45
pip drop over 5 minutes and the Swiss Franc also gained with USDCHF down 70 pips in the same 11
minutes as the Yen pair moves. The big positive +3.8 deviation in July did not move the USDJPY up
as much as August's -4.2 moved it down. Panic selling far outpaced it, perhaps some simply didn't
believe the high figure, as there are sometimes tempory distortions as in most statistics. Likewise
the -3.6 in June didn't do much either as it was not low enough to create this fear. A +/-2.5 dev
can work with good slippage control and give a small 10-20 pip scalp, but a better safer dev is +/-3.5
if 55.5 or higher then buy USDJPY for a potential 20-40 pip move
if 48.5 or lower then sell USDJPY for a potential 20-40 pip move
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