Hey folks,
The markets remain in consolidative limbo as the risk appetite momentum wanes and stocks round off this potential high. We're getting to a point now where the coming 3-6% selloff should start pretty soon, or else we'll have to more strongly consider other possibilities (like the retracement getting replaced by just an extended consolidation triangle or something). Irregardless, the forecast remains the same... a near term decline should take stocks lower to 900-920 (or close) over the next week and it's quite possible the EUR/USD and GBP/USD will make nice complimentary retracements lower in conjunction. The best medium to long term opportunity is to use the retracement lower to load up for a long position trade as stocks gear up for another rally leg into the 1000-1100 range and the EU & GU gun to new highs. Gold and silver will likely swing along with these moves as well, but I prefer to hold Silver short through all of this and add on further retracement above $14 since I only trade gold and silver long term.
Just to recap from prior signal discussions, the big picture here is that we will likely have a continued rally leg through towards the end of the summer, but around then or the early fall as optimism peaks along with the markets, we should cap off a major high that will lead to considerable declines that should test and likely break the March lows. But this isn't late summer, and we still have some good rallying left in us, so as long as you're following the markets regularly, it's best to position for the long side until we reach optimism extremes along with waning momentum and a more clear 3 wave advance on the weekly chart seemingly complete.
On news Wednesday, in the BoE minutes, a 9-0 vote to leave the APF unchanged at 125 billion pounds along with some more optimistic language helped to bolster the GBP/USD, but there was enough volatility that we were able to actually make some pips by shorting the highs. More than one way to skin a cat around the news, heh. Canadian Retail Sales (headline) came out high enough to hit our sell trigger, and we got about 25-30 pips quickly followed by a period of choppy retracement and an eventual break much lower without violating the prerelease price... so I'd say that's pretty solid price action for a CAD report. For news Thursday:
0430 UK Retail Sales m/m (0.3% expected) - This trade was an absolute blockbuster last month, but in today's complicated markets, history has a tough time repeating itself in back to back months, so even though this is one of the better trade opportunities of the month, be careful. We have seen decent deviations cause pure fakeouts this year, so don't let a loss run too hard against you.
If it comes out at 0.8% or higher, GBP/USD should rally 40 pips or more.
If it comes out at -0.3% or lower, GBP/USD should sell off 40 pips or more.
Watch out for strong trends on GU heading into the report. Oftentimes a strong Euro session trend heading into 0430 news will end up reversing no matter which way the news comes out.
1000 US Existing Home Sales (4.84M expected) - We've only seen small deviations on this one in the last few months, but if we get something more substantial, this trade should see a strong reaction out of EUR/USD. This report has become THE most important housing number of the month; however, reaction is typically small in the first minute, so if it hits the triggers, get in and ride it even if there wasn't a huge pop right away. There's a chance it could get ignored, but the odds are greater it will start to push both stocks and the Euro.
If it comes out at 5.00M or higher, EUR/USD should rally steadily for 40-50 pips.
If it comes out at 4.69M or lower, EUR/USD should sell off steadily for 40-50 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 markets remain in consolidative limbo as the risk appetite momentum wanes and stocks round off this potential high. We're getting to a point now where the coming 3-6% selloff should start pretty soon, or else we'll have to more strongly consider other possibilities (like the retracement getting replaced by just an extended consolidation triangle or something). Irregardless, the forecast remains the same... a near term decline should take stocks lower to 900-920 (or close) over the next week and it's quite possible the EUR/USD and GBP/USD will make nice complimentary retracements lower in conjunction. The best medium to long term opportunity is to use the retracement lower to load up for a long position trade as stocks gear up for another rally leg into the 1000-1100 range and the EU & GU gun to new highs. Gold and silver will likely swing along with these moves as well, but I prefer to hold Silver short through all of this and add on further retracement above $14 since I only trade gold and silver long term.
Just to recap from prior signal discussions, the big picture here is that we will likely have a continued rally leg through towards the end of the summer, but around then or the early fall as optimism peaks along with the markets, we should cap off a major high that will lead to considerable declines that should test and likely break the March lows. But this isn't late summer, and we still have some good rallying left in us, so as long as you're following the markets regularly, it's best to position for the long side until we reach optimism extremes along with waning momentum and a more clear 3 wave advance on the weekly chart seemingly complete.
On news Wednesday, in the BoE minutes, a 9-0 vote to leave the APF unchanged at 125 billion pounds along with some more optimistic language helped to bolster the GBP/USD, but there was enough volatility that we were able to actually make some pips by shorting the highs. More than one way to skin a cat around the news, heh. Canadian Retail Sales (headline) came out high enough to hit our sell trigger, and we got about 25-30 pips quickly followed by a period of choppy retracement and an eventual break much lower without violating the prerelease price... so I'd say that's pretty solid price action for a CAD report. For news Thursday:
0430 UK Retail Sales m/m (0.3% expected) - This trade was an absolute blockbuster last month, but in today's complicated markets, history has a tough time repeating itself in back to back months, so even though this is one of the better trade opportunities of the month, be careful. We have seen decent deviations cause pure fakeouts this year, so don't let a loss run too hard against you.
If it comes out at 0.8% or higher, GBP/USD should rally 40 pips or more.
If it comes out at -0.3% or lower, GBP/USD should sell off 40 pips or more.
Watch out for strong trends on GU heading into the report. Oftentimes a strong Euro session trend heading into 0430 news will end up reversing no matter which way the news comes out.
1000 US Existing Home Sales (4.84M expected) - We've only seen small deviations on this one in the last few months, but if we get something more substantial, this trade should see a strong reaction out of EUR/USD. This report has become THE most important housing number of the month; however, reaction is typically small in the first minute, so if it hits the triggers, get in and ride it even if there wasn't a huge pop right away. There's a chance it could get ignored, but the odds are greater it will start to push both stocks and the Euro.
If it comes out at 5.00M or higher, EUR/USD should rally steadily for 40-50 pips.
If it comes out at 4.69M or lower, EUR/USD should sell off steadily for 40-50 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