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Forex Signal (Thursday December 1, 2011 – 10:00am EDT) – US ISM Manufacturing PMI

Discussion in 'Current Forex Trading Signals' started by Stavro D'Amore, Nov 30, 2011.

  1. Stavro D'Amore

    Stavro D'Amore Former FPA Special Consultant

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    Hello Guys,

    Today we have US ISM PMI see my trade plan below.

    US ISM Manufacturing PMI
    Forecast 51.5
    Previous 50.8
    Pair to trade: USD/JPY and EUR/USD

    Numbers we need:
    BUY USD/JPY 54 or higher
    BUY EUR/USD 49 or lower

    Economical Impact: High
    Typical Result: Good for Currency
    Occurrence: monthly, on the first business day after the month ends
    Spike Probability: Good, we can see 45 pips on initial spike

    About our Triggers:
    US ISM Manufacturing Index forecasted to arrive at 51.5
    we are looking for a deviation of 2.5K either way on this trade.
    If we get 54 or better I will look to enter a LONG position on USD/JPY and if we get
    49 or lower deviation I will go LONG on EUR/USD.
    Should this report be triggered, we can expect to see about 45 pips on the initial spike on both pairs USD/JPY and EUR/USD. We have no known conflict for this release. This trade will have a good chance of a 30% retrace on the initial spike.

    What is it? And why does the market care?
    This data is considered a very important and trusted economic measure. If the index has a value below 50, due to a decrease in activity, it tends to indicate an economic recession, especially if the trend continues over several months. A value substantially above 50 likely indicates a time of economic growth. The ISM index is the result of a monthly survey of over 400 companies in 20 industries throughout the 50 states.
    The ISM's leading quality has been proven over time. During a recession, the ISM's bottom may precede the turning point for the economic cycle by some months.

    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

    Felix Trading Indicators:
    See Felix descriptions

    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 15 pip limit order to control slippage.

    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.

    Historical Chart and Data for US ISM Manufacturing PMI

    All the best

    Stavro D’Amore
     
    #1 Stavro D'Amore, Nov 30, 2011
    Lasted edited by : Sep 8, 2016
  2. Fxonuoha

    Fxonuoha Private, 1st Class

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    I really need someone to aid me with retracement trading,without pre-news these pips are without my reach.:confused:
     
  3. Louis123321

    Louis123321 Corporal

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    Very strange result for this trade it came out at 52.7 but EURUSD shot up & USDJPY down. Sadly i was expecting the opposite and lost abit. :(

    Edit: I noticed it DID infact spike up (USDJPY) and EURUSD spiked down..but they spiked the opposite way 1st, it took like 30min+ for the spike to 'correct' itself the right way.. I am a dumbass. Lost money on this >.< ... I guess it's a lesson to learn, trust the signal.. Even if it takes some time to 'flurish'..
     
    #3 Louis123321, Dec 1, 2011
    Last edited: Dec 1, 2011
  4. PipDog

    PipDog Corporal

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    Why?


    So the posted number was mildly good...but it did not meet the triggers that Stavro suggested. Why did you trade on the news?

    And, the USD immediately weakened due to the Risk Trade...FX markets thought this might drive stocks up. Looked like a good short, as the AUDUSD...the best pair correlation to stock markets...is down 50 pips from it's little spike. Coincidently, the DJIA shot up at the news, also, and has dropped since then.
     

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