Hey folks,
The EUR/USD and GBP/USD worked in a bit of consolidative pattern over the last 24 hours and I'm still looking to position trade them long once they get a nicer dip back down around 1.4000 and into the 1.6200's respectively. Target is somewhere above their recent June/July highs to be determined, but should be at least 300-400 pips on EUR/USD and 500+ on GBP/USD.
Well, the flip from risk aversion to risk appetite in stocks continued unfortunately without a big dip yesterday. The psychological lift today was when noted pessimist Nouriel Roubini turned optimistic on the recovery. Eventually I made the decision to bail my stock longs on the break up into the 930's. Hopefully a pullback does develop here in the coming day or two to help others get out of shorts who are waiting for more of a pullback, but since I personally was short from an average price of around 920, I wanted to take what I could get for it now in case that pullback doesn't come any time soon and a further short squeeze develops. If and when we get a pullback closer to 900-920, being completely out already frees us up to weigh in on a potential long there. Again, I believe the whipsaw we've seen this week is likely the first stage of a multi-stage rally that will take us into the 1000-1100 range on the S&P in the coming month or two, so even speculating long now isn't such a horrible idea if you do so with low leverage. It would likely take a clear impulsive move back down to and through the 870's to debunk the upside hypothesis, so for now, the clear opportunity is either a chaser position trade buy now at market (around 935 fair value as I write) with a wide SL, or a swing trade/optimal position trade long on a dip into the 900-920 range. I personally have not yet entered long (waiting for the situation to clear up and maybe pull back a bit) but I'll let you know once I do.
In silver, the risk appetite rally has brought silver back up near $13.40 which is an ok place to initiate a position trade short if you're not in (it's where we entered the other week), but I would save some ammunition to add more on a rally to and through $14 which will likely come on the heels of the next leg of this stock market rally. A good place to target for a short on a larger pullback up is about $14.30. As long as stocks are bullish, silver should be stronger than gold and retrace higher with greater % gains. In news Friday:
0700 CAD Core CPI m/m (0.0% expected) - Realistically guys, this news has performed very poorly and it's almost better to trade against the spike after it swings a good 15-20 pips. Both good deviations in the last 6 months have made 20 pips or less and reversed.
0830 US Housing Starts m/m (530K expected) - This news has a better chance of getting some good price action, but still has been a bit hit or miss lately. A "miss" would mean maybe 40 pips on the EUR/JPY in 1-2 minutes followed by a reversal (see last month), while a "hit" would mean 40-50 pips in the first 1-2 minutes, some sort of pullback, and a 40-50 pip continuation from the pullback (see 2 months ago). If we get a surprise, we'll see which develops.
If it comes out at 584K or higher, EUR/JPY should rally 40+ pips.
If it comes out at 480K or lower, EUR/JPY should sell off 40+ pips.
TRADE LIVE WITH SIR PIPS FOR $39.00 FOR 2 WEEKS
Sir Pipsalot has a live trading room, in which he trades these news reports. There, he shares his trades in real time, including exact entries and exits, and detailed explanation for every entry and exit. The service costs $299 per month, but we have a 14-days $39.00 trial. Go to Forex Diamonds and take advantage of this offer. This offer is for NEW customers only.
To our success,
Sir Pipsalot
The EUR/USD and GBP/USD worked in a bit of consolidative pattern over the last 24 hours and I'm still looking to position trade them long once they get a nicer dip back down around 1.4000 and into the 1.6200's respectively. Target is somewhere above their recent June/July highs to be determined, but should be at least 300-400 pips on EUR/USD and 500+ on GBP/USD.
Well, the flip from risk aversion to risk appetite in stocks continued unfortunately without a big dip yesterday. The psychological lift today was when noted pessimist Nouriel Roubini turned optimistic on the recovery. Eventually I made the decision to bail my stock longs on the break up into the 930's. Hopefully a pullback does develop here in the coming day or two to help others get out of shorts who are waiting for more of a pullback, but since I personally was short from an average price of around 920, I wanted to take what I could get for it now in case that pullback doesn't come any time soon and a further short squeeze develops. If and when we get a pullback closer to 900-920, being completely out already frees us up to weigh in on a potential long there. Again, I believe the whipsaw we've seen this week is likely the first stage of a multi-stage rally that will take us into the 1000-1100 range on the S&P in the coming month or two, so even speculating long now isn't such a horrible idea if you do so with low leverage. It would likely take a clear impulsive move back down to and through the 870's to debunk the upside hypothesis, so for now, the clear opportunity is either a chaser position trade buy now at market (around 935 fair value as I write) with a wide SL, or a swing trade/optimal position trade long on a dip into the 900-920 range. I personally have not yet entered long (waiting for the situation to clear up and maybe pull back a bit) but I'll let you know once I do.
In silver, the risk appetite rally has brought silver back up near $13.40 which is an ok place to initiate a position trade short if you're not in (it's where we entered the other week), but I would save some ammunition to add more on a rally to and through $14 which will likely come on the heels of the next leg of this stock market rally. A good place to target for a short on a larger pullback up is about $14.30. As long as stocks are bullish, silver should be stronger than gold and retrace higher with greater % gains. In news Friday:
0700 CAD Core CPI m/m (0.0% expected) - Realistically guys, this news has performed very poorly and it's almost better to trade against the spike after it swings a good 15-20 pips. Both good deviations in the last 6 months have made 20 pips or less and reversed.
0830 US Housing Starts m/m (530K expected) - This news has a better chance of getting some good price action, but still has been a bit hit or miss lately. A "miss" would mean maybe 40 pips on the EUR/JPY in 1-2 minutes followed by a reversal (see last month), while a "hit" would mean 40-50 pips in the first 1-2 minutes, some sort of pullback, and a 40-50 pip continuation from the pullback (see 2 months ago). If we get a surprise, we'll see which develops.
If it comes out at 584K or higher, EUR/JPY should rally 40+ pips.
If it comes out at 480K or lower, EUR/JPY should sell off 40+ pips.
TRADE LIVE WITH SIR PIPS FOR $39.00 FOR 2 WEEKS
Sir Pipsalot has a live trading room, in which he trades these news reports. There, he shares his trades in real time, including exact entries and exits, and detailed explanation for every entry and exit. The service costs $299 per month, but we have a 14-days $39.00 trial. Go to Forex Diamonds and take advantage of this offer. This offer is for NEW customers only.
To our success,
Sir Pipsalot
