Forex Signal (Monday December 5, 2011 - 10:00am EDT) - US ISM Non-Manufacturing PMI

Stavro D'Amore

Former FPA Special Consultant
Messages
547
Hello,

Today we have US ISM Non-Manufacturing due for its release; I have provided my strategy and some information in my trade plan below so we can earn some pips.

US ISM Non-Manufacturing PMI
Forecast 53.4
Previous 52.9
Pair to trade: USD/JPY and EUR/USD
Triggers we need: 55.4 BUY USDJPY / 51.4 BUY EURUSD

Economical Impact: High
Typical Result: Actual forecast is good for the currency
Occurrence: Released monthly
Spike Probability: Good, we can see 30 pip spike

About our Triggers:
Current forecast is 53.4 We'll be using deviation of 2 points in order to BUY or SELL USD. In the event that 55.4 is reached, we could see some USD strength and JPY weakness. Therefore you could BUY USD/JPY; however, if the opposite is true and a figure of 51.4 or lower is released, expect to see stronger EUR and I will be buying EUR/USD pair


What is it? And why does the market care?
It's a leading indicator of economic health and businesses both global and local businesses will react quickly to market conditions. A Higher deviation means industry expansion, lower deviations indicates a significant contraction in the economy. It is derived by a survey of about 400 purchasing managers which asks respondents to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries and inventories

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

Indicator Descriptions
Felix indicator Descriptions

Revision
Please keep in mind possibility of Revision number before entering any of these strategies.

Pre News
Prior to the release (20-15 mins) I will be looking for a short term long position in EUR/USD and I will get out of this trade 5 minutes before the actual release or any spreads that should widen.

Spike
I'd recommend spike trading as an option when if you’re using an ECN broker with controlled fills or a broker that you can get filled with.

After Release
I will look for a 35% retracement in the original spike before entering a trade; I will close 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 level looking at a 15 min time frame. If my triggers are hit I will defiantly try to run this for over 120 minutes depending on current market volume, to do this I will look for a choppy volume (if you’re using MT4 you would look for the volume bar tab).

Historical Chart and Data for US ISM Non-Manufacturing PMI



All the best

Stavro D’Amore
 
Last edited by a moderator:
big thank you

I enjoy reading your comments and your suggested trades. Many thanks
for the research.
Dave
Cape Town
 
Hello, Stavro!

I am new to your service and find what you have to offer interesting, and invaluable in assisting the comprehension
of this complex market.

Many thanks.

Nitejar.
 
Pre News
Prior to the release (20-15 mins) I will be looking for a short term long position in EUR/USD and I will get out of this trade 5 minutes before the actual release or any spreads that should widen.

SpikeThe pre-news wasn't what I anticipated,anyways,waiting for the retracement of the after spike.
 
Spike
I'd recommend spike trading as an option when if you’re using an ECN broker with controlled fills or a broker that you can get filled with.

After Release
I will look for a 35% retracement in the original spike before entering a trade; I will close 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 level looking at a 15 min time frame. If my triggers are hit I will defiantly try to run this for over 120 minutes depending on current market volume, to do this I will look for a choppy volume (if you’re using MT4 you would look for the volume bar tab).
what happened out there?Was expecting one huge spike.
 
what happened out there?Was expecting one huge spike.
and "anyways,waiting for the retracement of the after spike".


First, the triggers on the deviation were not hit. Second, what spike are you referring to? Third, why would you be expecting a "huge spike"...?
 
Back
Top