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Forex Signal (Monday April 16, 2012 - 8:30AM EDT) – US Core Retail Sales

Discussion in 'Current Forex Trading Signals' started by Stavro D'Amore, Apr 15, 2012.

  1. Stavro D'Amore

    Stavro D'Amore Former FPA Special Consultant

    Jul 29, 2011
    Likes Received:

    Please see my trade plan below.

    US Core Retail Sales
    Forecast 0.6%
    Previous 0.9%
    Pair to trade: USD/JPY and EUR/USD

    Triggers we need:
    BUY USD/JPY 1.0%
    BUY EUR/USD -0.1%

    Economic Impact: Critical
    Typical Result: Good for currency
    Occurrence: Released monthly, about 10 days after the month ends

    About our Triggers:
    US Core Retail Sales is forecasted to arrive at 0.2%. We are looking for a deviation on this trade of 0.6% to enter a LONG position on USDJPY and -0.4% to enter LONG position on EUR/USD.
    Should this report be triggered, we can expect to see about 45pips on the initial spike for both pairs that we are trading.

    What is it?
    The Core Retail Sales is a monthly measurement of all goods sold by retailers based on a sampling of retail stores of different types and sizes in the US, excluding auto.

    Why does the market care?
    Automobile sales account for about 20% of Retail Sales, but they tend to be very volatile and distort the underlying trend. The Core data is therefore thought to be a better gauge of spending trends. It is an important indicator of consumer spending and also correlated to consumer confidence and considered as a pace indicator of the US economy.

    A higher than expected reading should be taken as positive/bullish for the USD.
    A lower than expected reading should be taken as negative/bearish for the USD.

    Method I use to trade this:
    Stavro D’Amore Trading Method

    Euro Crisis
    See my Views on The EURO

    Approximately 15 minutes prior to the news release I will be looking for a short term LONG position in EUR/USD.
    I would be out of this LONG trade 2 minutes before the actual release, or to avoid any spreads that should widen.

    I will look for a 30-50% retracement in the original spike before entering a trade; I will sell half my position as soon as I hit the original high point of the first initial spike and place a SL at entry price. My TP level would be just before a resistance level or if the chart decides to form a support level, looking at a 15 minute chart time frame.

    I do recommend spike trading as an option when there is great uncertainty in the markets; also the liquidity is very good at the moment if you are using an ECN broker.

    Historical Chart and Data for US Core Retail Sales

    All the best

    Stavro D’Amore

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