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Forex Trading Signal 9-3-2009

Discussion in 'Current Forex Trading Signals' started by Sir Pipsalot, Sep 3, 2009.

  1. Sir Pipsalot

    Sir Pipsalot Former FPA Special Consultant

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    Hey folks,

    The EUR/USD did manage to retrade near the 1.4300 level I mentioned yesterday that would be a good point to resell the Euro (our trading room got a bit lucky with a good fill having our limit sell set at 1.4294); however, with Gold and Silver busting upwards through their biasing points, it makes the odds a bit tougher that the Euro will sell off before posting new highs above 1.4450 (probably somewhere around 1.4700). For now, some doubts have been thrown into the mix and I think it's best to just wait until things clear up a bit on the Euro before getting ambitious with further new trades in either direction. I plan to hold my current position and swing trade short for at least another day to see what develops. On GBP/USD, the downtrend is more clear and I don't feel as threatened holding my position short there.

    Yesterday I mentioned that stocks were likely to consolidate or retrace a bit, and indeed, stocks pretty much consolidated near Tuesday's lows and posted a small loss. For Thursday, the picture is a bit less clear since stocks could post another downleg or rally off consolidation lows for a modest bounce. In either case, the medium and long term direction is now decidedly down, so my recommendation is to sell any rally into the 1010 to 1015 range, which is the same advice I gave as yesterday.

    As I mentioned, Gold and Silver busted through their prior $971 and $15.22 highs and have now tilted the odds much more in favor of further strength likely up through $1007 and $16.30. At this point I recommend closing any position trade shorts on Gold and Silver for a loss, as further gains in both metals are likely. However, this does present us with an opportunity to speculate long with a more short term position trade, and I recommend doing so on Gold instead of Silver since we're bearish stocks. I'm personally going to go long on Gold near current levels around $976 with a $30 stop looking for a $1006 TP or maybe a bit more depending on how it looks. This one should work out one way or another in the next week or so.

    In news Wednesday, ADP data and the FOMC minutes failed to surprise the markets significantly. In news Thursday:

    0428 UK Services PMI (54.0 expected) - This indicator is usually pretty solid and good for 40 pips quickly. Whether or not it holds on and gets more follow-through has been hit or miss lately, so it's hard to say. With a disappointing manufacturing PMI on Tuesday, the markets might be a bit fearful of this fearful and there may be some GBP weakness heading into the number.
    If it comes out at 55.3 or higher, GBP/USD should rally 40+ pips.
    If it comes out at 53.7 or lower, GBP/USD should fall 40+ pips.

    0745 ECB Interest Rate Decision (no change at 1.00% expected) - Economists unanimously expect no change on Eurozone interest rates, and I agree that there is little or no chance they will change. If there is a move, it will be a big surprise.
    If it comes out at 1.25% or higher, EUR/USD should rally 100+ pips.
    If it comes otu at 0.75% or lower, EUR/USD should sell off 100+ pips.

    0830 Trichet's post interest rate speech - Trichet's commentary in his speech following the interest rate statment has become less and less important over the last several months. The market reaction has been rather disappointing because interest rate expectations aren't really driving currencies right now. However, if Trichet comes out with something especially surprising regarding policy, exit strategy, or the Euro itself, there's definitely event risk of a big Euro move... it's just hard to say right now what that could be. I recommend trading your usual technicals on the Euro and keeping an ear to the news or an eye on the headlines in case something really juicy pops up.

    1000 US ISM Non-Manufacturing Composite (48.0 expected) - This indicator made a decent move last month, but the low volume this month may make a move off this number disappointing just as it did on ISM Manufacturing on Tuesday. I'm planning to skip this one, but if you really want to trade it, I suggest using wider triggers than usual to make sure the number has some sticker shock. If the number does effect markets, I think it will be best seen on either the USD/JPY or EUR/JPY.
    If it comes out at 50.0 or higher, USD/JPY should rally 30-40 pips.
    If it comes out at 46.0 or lower, USD/JPY should fall 30-40 pips.

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    Sir Pipsalot
     
  2. Sir Pipsalot

    Sir Pipsalot Former FPA Special Consultant

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    FYI, just so you guys don't get the news too late, I decided to exit our position trades short on the EUR/USD, GBP/USD and even our swing trade short on the EUR/USD after the UK news this morning. We got out around 1.4300 and 1.6340. Overall on the position trade we broke even on the EUR/USD and made about 400 pips on the GBP/USD. Also, the way we manage position trades with my trading system makes money on the volatility as well, so I managed about a 3-4% gain overall working those 2 shorts. Not bad for a trade that really didn't work out and had to be bailed and definitely better than a loss. Right now I'm short/medium term bearish USD across the board and looking to buy the EUR/USD or GBP/USD on decent dips.
     
  3. Sir Pipsalot

    Sir Pipsalot Former FPA Special Consultant

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    I've done some projections and I decided to put half TP at 1006, and the other half at 1035
     
  4. Mark Harding

    Mark Harding Corporal

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    Thanks Sir Pipsalot...
     

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