Forex Trading Signal 8/13/09

Sir Pipsalot

Former FPA Special Consultant
Hey guys, I sent out the signal a little late last night to Crazy Cat, but it looks like it never got put up here. For completeness' sake, here's what it was:

Hey folks,

Sorry for the late, short signal tonight, but I got wrapped up trading German GDP and doing some other stuff with the Diamonds room this evening. So far the EU and GU have been working hard to retrace their first down leg upwards towards more optimal levels. Long story short, the EUR/USD has pulled into a sell zone from a position trade standpoint now around 1.4260, and while more key resistance for a more targetted sell lies at 1.4315, I think shorting the EUR/USD around this region for a position trade with an SL somewhere above the 1.4450 highs makes good sense, especially if you missed my short call from around 1.4400 last week. The GBP/USD is a bit tougher though as it could end up falling short or pulling much higher... it's hard to say. In general though, I think the GBP/USD is a good position trade sell between 1.6600 and 1.6830 with good selling spots at 1.6630 and 1.6800.

Silver and Gold continue to waffle around, but I still recommend holding short. We need to see stocks finally top out to help out silver to the downside.

Stocks are showing less and less upside breadth and health with every up surge. Fed day is usually very stock bullish, so a bit of a rally wasn't too much of a surprise today... the key level break we need for downside confirmation remains 993.

In news Wednesday, we saw both the BoE Inflation Report and US FOMC Interest Rate Statement give some very whipsawish price action that lead to good quick trades, but bad if you held on for very long. It was just tough price action overall as the USD is stubbornly weakening to finish its retracement. German GDP just a bit earlier was a great trade though and lead to a 50+ pip move on the EUR/USD that was nice and steady and easy to get in on shortly after the news. On Thursday:

0830 US Retail Sales X Autos (0.1% expected) - We're continuing to see a shift in the way USD reacts to US news, so I'd recommend playing it a bit safer and going over to USD/JPY for this one.
If it comes out at 0.6% or higher, USD/JPY should rally 30-40 pips.
If it comes out at -0.5% or lower, USD/JPY should sell off 30-40 pips.

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To our success,
Sir Pipsalot