Stavro D'Amore
Former FPA Special Consultant
- Messages
- 547
Hello,
Today we have the following:
US Pending Home Sales m/m
Forecast -0.8%
Previous 2.4%
Pair to trade: USD/JPY
Numbers we need:
BUY USD/JPY 9.8%
SELL USD/JPY -9.8%
Economical Impact: High
Typical Result: Good for Currency
Occurrence: monthly, about 35 days after the month ends
Spike Probability: Good, we can see 30 pips on initial spike
About our Triggers:
US Pending Home Sales m/m is forecasted to arrive at -0.8%.
We are looking for a deviation of 9% either way on this trade.
If we get 9.8% or better I will look to enter a Long position on USD/JPY and if we get
-9.8% or lower I will go Short on USD/JPY.
Should this report be triggered, we can expect to see about 30 pips on the initial spike.
NOTE: We have no known conflict for this release. This report either reacts really well or does not react at all. Be prepared that USD/JPY may not move, even with a huge deviation. Should the trade not move, close any open positions if you get triggered on the spike. If this sentiment deviates and we see a large move, then a retracement method will be a good option.
What is it? And why does the market care?
It is a leading indicator of economic health because the sale of a home triggers a wide-reaching ripple effect. For example, renovations are done by the new owners, a mortgage is sold by the financing bank and brokers are paid to execute the transaction.
Pending Home Sales m/m measures change in housing contract activity. It is designed to be a leading indicator of housing activity. It is based on signed real estate contract for existing single-family homes, condos and co-ops. A signed contract is not counted as a sale until the transaction closes. The index is not including new construction in its count. It is a leading indicator of economic health because the sale of a home triggers a wide-reaching ripple effect.
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
I will look for a 30% retracement in the original spike before entering. I will be looking at a 5 minute chart. 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 the original spike 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 to analyze this.
I do recommend spike trading as an option. Liquidity is very good at the moment if you are using an ECN broker. Please use no more than a 10 pip limit order.
Historical Chart and Data for US Pending Home Sales m/m
All the best
Stavro D’Amore
Today we have the following:
US Pending Home Sales m/m
Forecast -0.8%
Previous 2.4%
Pair to trade: USD/JPY
Numbers we need:
BUY USD/JPY 9.8%
SELL USD/JPY -9.8%
Economical Impact: High
Typical Result: Good for Currency
Occurrence: monthly, about 35 days after the month ends
Spike Probability: Good, we can see 30 pips on initial spike
About our Triggers:
US Pending Home Sales m/m is forecasted to arrive at -0.8%.
We are looking for a deviation of 9% either way on this trade.
If we get 9.8% or better I will look to enter a Long position on USD/JPY and if we get
-9.8% or lower I will go Short on USD/JPY.
Should this report be triggered, we can expect to see about 30 pips on the initial spike.
NOTE: We have no known conflict for this release. This report either reacts really well or does not react at all. Be prepared that USD/JPY may not move, even with a huge deviation. Should the trade not move, close any open positions if you get triggered on the spike. If this sentiment deviates and we see a large move, then a retracement method will be a good option.
What is it? And why does the market care?
It is a leading indicator of economic health because the sale of a home triggers a wide-reaching ripple effect. For example, renovations are done by the new owners, a mortgage is sold by the financing bank and brokers are paid to execute the transaction.
Pending Home Sales m/m measures change in housing contract activity. It is designed to be a leading indicator of housing activity. It is based on signed real estate contract for existing single-family homes, condos and co-ops. A signed contract is not counted as a sale until the transaction closes. The index is not including new construction in its count. It is a leading indicator of economic health because the sale of a home triggers a wide-reaching ripple effect.
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
I will look for a 30% retracement in the original spike before entering. I will be looking at a 5 minute chart. 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 the original spike 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 to analyze this.
I do recommend spike trading as an option. Liquidity is very good at the moment if you are using an ECN broker. Please use no more than a 10 pip limit order.
Historical Chart and Data for US Pending Home Sales m/m
All the best
Stavro D’Amore
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