Forex Signal (Wed July 14, 2010 8:30am EST NY Time) U.S. Core Retail Sales

[Henry Liu]

Henry,

Crazy Cat used to give us suggested profit targets & stops, is it possible for you to do this?


Thanks


nick

Usually I'm looking for minimum 50 pips, so the target is standard at 50 unless otherwise indicated.

 

[Henry Liu]

Thanks for the posting Henry..

I'm new to news trading and I think this was quite a mixed re-action to apparently fairly negative news (-0.5%) on USD.

The USD/JPY moved to the downside by about 13 pips or so and then surged up a good 26 pips, on a negative number for the dollar. GBp/USD moved 20-30 pips on the release but is now back to pre-release price (as at 13:55 BST). USD/CHF didn't have much of a reaction either.

Can you shed more light on the move? I would have expected USD/JPY to move down and keep going, not surge back up! Would the various currencies reactions indicate that the market sees some strength in the dollar and that we could be on the verge of a dallar rally?

Thanks,

Francis

The -0.5% was due to the automotive component which was down last month. Usually we go by the Core Retail Sales, also known as Retail Sales EX Auto, as it excludes the auto component. Today's reaction could only be considered as no direction. This was in fact a no trade. After the initial shock of news release, market went on to the pre-release trend. So the best course of action was to stay out.

 

[Henry Liu]

Hi Henry
Could you tell me what kind of special program you are refering about?
Thanks
Ange


I was talking about the SPIKE TRADING trend from madruga

Not sure what you are referring to....

 

[knightal]

Possibility of a follow up report

Hi Henry
Although I do not understand all of what you say it makes sense that the news should affect the market.

With regard to the Forex Signals you give what is the possibility of a follow up report on what happend and how, if at all the signal was traded.

I have looked at the chart for (Forex Signal (Wed July 14, 2010 8:30am EST NY Time) U.S. Core Retail Sales - 07-13-2010, 07:52 PM )
and to be honest as this is a new concept it does not tell me that much.

Regards
Allan

 

[frankstar]

Core Retail came out exactly as expected, and Headline deviated by 0.3. It was expected at -0.2, and came out at -0.5. So, a negative number was already priced in, and since Core didn't deviate at all, the small deviation on Headline wasn't enough to move the market that much initially. So this was a no trade really.

Hope that helps.

Also, it's important to keep in mind that reactions to news don't always make sense. Two years ago news made so little sense that it was actually profitable to trade against the number (i.e. if it was a positive UK report you'd sell the pound.) We did that a lot in Felix's old Diamonds trading room. A lot of times this happens because banks use news to sweep stops both long and short. One look at an NFP chart almost any month shows you that.

If you're interested, "Beat the Forex Dealer" is a book written by a former MIG employee that describes a lot of this stuff.

Thanks Boko, will check the book out on Amazon

 

[frankstar]

The -0.5% was due to the automotive component which was down last month. Usually we go by the Core Retail Sales, also known as Retail Sales EX Auto, as it excludes the auto component. Today's reaction could only be considered as no direction. This was in fact a no trade. After the initial shock of news release, market went on to the pre-release trend. So the best course of action was to stay out.

Thanks Henry - I'll make a note of that (core retail sales). I did stay out - so that was one "good trade" (best trade = no trade)


Francis