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Forex Signals (Tuesday April 24, 2012 NY TIME 10:00am EDT) – US New Home Sales

Discussion in 'Current Forex Trading Signals' started by Stavro D'Amore, Apr 24, 2012.

  1. Stavro D'Amore

    Stavro D'Amore Former FPA Special Consultant

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    Hello

    Please see my trade plan below

    US New Home Sales
    Forecast 320K
    Previous 313K
    Pair to trade: EUR/USD & USD/JPY

    Triggers we need:
    SELL EUR/USD 385K
    BUY USD/JPY 255K

    Economical Impact: Extremely Critical
    Typical Result: Good for currency
    Occurrence: Released monthly, about 23 days after the month ends
    Pip Rang: 45

    About our Triggers:
    US New home sales forecasted to arrive at 320K. We are looking for a deviation on this trade of 65K to BUY EUR/USD and a deviation of 65K to BUY USD/JPY. This is a very critical news release as many traders and economists will be focusing on this news release. Should this trade deviate, we will see major volatility in all US pairs. We can expect to see about 45pips on the initial spike.

    What is it? Why does the market care?
    The New Home Sales measures the annualized number of new residential buildings that were sold during the previous month.
    This report helps to analyse the strength of the US housing market, which helps to analysis the economy as a whole.
    The new home sales report is quite volatile and subject to huge revisions.

    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

    Pre- News
    Please only follow this if you have basic knowledge of technical’s, if not please practice and use demo accounts prior to using any professional strategy I suggest.

    Approximately within the 15 minutes and up to 2min prior to the news release I will be looking for a short term LONG position using EUR/USD pair.
    I would be out of this trade 2 minute before the actual release, or to avoid any spreads that should widen to protect myself.

    To determine my LONG position on an MT4 chart, I will pull up a 1mintime frame EUR/USD chart. I will then load two MA (moving average) indicators to my chart, the first MA I will load will be on set to period 9 whilst the other I will set to a period of 20. I would also recommend you change the colour of both I usually use green and red.

    When I see the up trend occur and my MA crosses over I will enter long, I want to be out of this trade in profit at least 2 min before the release. I will have a Stop loss of 15 pips and a TP either when I see the trade looking flat (looking at Volume Bars that is) or when an initial reversal comes to play.

    Spike Trading
    I do recommend spike trading as an option if you are using auto click software and the golden goose broker that fills you in.

    After News
    I will look for a 30-50% 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 support level, looking at a 15 minute chart time frame.

    Historical Chart and Data for US New Home Sales

    All the best

    Stavro D’Amore
     
  2. Lord68

    Lord68 Recruit

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    you mean SELL USD/JPY 255K ...don't you?
     
  3. gen

    gen Recruit

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    sir dose it mean that gbp/usd has no impact you didnt say anything about it
     
  4. Vernard

    Vernard Recruit

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    Hi Stavro, could you please indicate if a sell or buy stop method can be used to "hedge" for the expected spike regardless of which direction it jumps to capture the pending order and also can you in future give your prediction of which direction is more probable with the tips. I missed today because of work but would have loved to get in on the action :)
     

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