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Forex Signal (Tue November 23 2010, 10:00am NY Time EST) - US Existing Home Sales...

Discussion in 'Current Forex Trading Signals' started by Henry Liu, Nov 22, 2010.

  1. Henry Liu

    Henry Liu Former FPA Special Consultant

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    US Existing Home Sales is expected to remain unchanged from the previous month as current market situation is showing signs of bottoming out on the housing sector. Here's forecast:

    Existing Home Sales Forecast 4.50M Previous 4.53M
    ACTION: EURUSD SELL 4.9M BUY 4.00M

    The Trade Plan

    Because the Housing sector is one of the most focused news events out of the US, this release will certainly cause some volatility in the market, especially if our tradable figures (+/- 400K) were hit. With the focus of the nation, and of the world, on the status of U.S. housing sector, this release may bring about a strong sentiment of risk appetite/aversion if our BUY/SELL trigger is hit…

    If our buy tradable deviation is hit, or 4.90M figure is released, we should look to SELL EURUSD after the release. If our buy tradable deviation is hit, or 4.00M figure is release, we should look to BUY EURUSD as USD should be sold off again.

    We'll be looking to trade this release using the after-news retracement trading method. We'll wait for the release, wait for market reaction, and wait for retracement before jumping in. For more information:
    Henry's News Trading Method.

    The Market
    With the current market leaning towards USD recovery, a strong release would be going with the trend, thus add more demand for USD. However, in the event of a worse than expected release, market could very well ignore it as it is no surprise for the housing market to be struggling.

    With FOMC Minutes coming up at 2:00pm, I'd be careful and stay out of the market unless we get our deviation... And even if we do get our deviation, I'd wait for market to show momentum before taking the trade.

    Additional Thoughts
    This release is scheduled at 10:00am US Time, usually it is the last high impact news for the NY session, but with today's FOMC Minutes scheduled at 2:00pm, we may not get much market reaction.

    Pre-news Considerations
    There is no pre-news opportunity for this release.

    Definition:
    “Measures the annualized number of existing residential buildings that were sold during the previous month. A rising trend has a positive effect on the nation’s currency because large purchases tend to be made by consumers that are optimistic and confident in their financial position. The sale of a home also triggers commissions for real estate agents, and often home owners will purchase goods such as appliances and furniture shortly after purchasing a home. Traders watch this report closely as it’s the month’s first demand-side housing indicator to be released.”

    Historical Data & Chart For US Existing Home Sales


    Thanks,


    [​IMG]
     
    #1 Henry Liu, Nov 22, 2010
    Lasted edited by : Sep 8, 2016

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