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Sir Pipsalot's Daily Market Update 11-02-2009

Discussion in 'Commercial Trade Journals' started by Sir Pipsalot, Nov 2, 2009.

  1. Sir Pipsalot

    Sir Pipsalot Former FPA Special Consultant

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    Hey everybody,

    Welcome to the new home for my daily signals. We may start to take a slightly different approach with them over time, but they'll still be packed with market information which I'm confident will help your trading. For easy access to these signals, please bookmark the link for the signals folder:
    Sir Pipsalot's Daily Trading Signals - Forex Peace Army Forum

    Outlook Summary:
    Roughly the same for EUR/USD, GBP/USD, Gold, Silver & Stocks:
    Longer term: SHORT with entry opportunities a bit higher from here.
    Shorter term: Tentative LONG unless last weeks lows give way.

    As far as the EUR/USD and GBP/USD are concerned, I think we have some nice bottoms formed that will lead to further retracements higher before the larger downtrend pushes them to new lows later in the week. Because of this, a short to medium term long with targets of 1.4850 on EU and 1.6600 on GU make sense depending on where you can get in. A break of last week's lows will be solid evidence that the shorter term rally momentum has given way to the longer term downtrend and those levels are much less likely to be seen.

    From a long term perspective, I am still short both GBP/USD and EUR/USD in low leverage position trades which I plan to hold for weeks to months. If you are not in but would like to take a similar long term trade, consider shorting EU or GU around or above those levels (1.4850 and 1.6600) with a 250 pip SL. I'm looking for over 1000 pips profit on both shorts, but will take some incremental profits along the way and resell strategically to work the volatility on the way down. If you want to learn more about position trading in this manner, it's one of the several strategies we teach in our trading room.

    Silver and Gold seem to be setting up for potential shorts as well, but as with shorting the Euro and GBP right now, I'd rather wait to do so at higher levels. I think 1053 to 1060 is a great area for a position trade short on Gold, and $17.00 to $17.30 is a good region to get short on Silver. Since I'm so long term bearish on stocks, I definitely prefer Silver short over the Gold short. Silver will almost always underperform gold when stocks are weak.

    Stocks had a very nice selloff Friday, but as I noted in a reply to my last Daily Trading signal:
    http://www.forexpeacearmy.com/forex...-trading-signal-10-30-2009-a-2.html#post22770
    I still maintain that outlook for now. I'm out of any shorter term shorts and actually have a small bet long near here at 1035 on futures (ES futures now at 1037) thinking there's a good chance we could bounce to 1060+ again before the next selloff, but will bail and reverse short on a break of last week's lows (1029 on futures). It's possible that waiting for higher prices could cause us to miss out on the next big wave down, but I'll be content to chase it short again if the S&P breaks through 1030, it just makes the SL difficult to place. I am holding my long term shorts through all of this volatility, and if you're not in on a long term short, I would look to enter around 1055-1060 with a 20-40 point stop. There's a decent chance this could be the big bear market rally top we've been looking for, and if not, there's still at least another 50-100 points of downside in this, so it's worth taking a ride.

    In news Friday, everything came out pretty close to expectations, so there's not much to report from that. In news Monday:

    0428 UK Manufacturing PMI (50.0 expected) - This indicator has been pretty hot lately, and should give a great move during the first 2-5 minutes, but after that it's anyone's guess. As long as the triggers are hit, even if you get in a bit late, chances are it will surge for at least 2 minutes (unless the first minute move exceeds 40 pips)
    If it comes out at 51.0 or higher, GBP/USD should rally 40+ pips.
    If it comes out at 49.0 or lower, GBP/USD should fall 40+ pips.

    1000 US ISM Manufacturing and Pending Home Sales - I don't think these reports are very tradable; however, US news has been making a nice comback in recent weeks, specifically on the EUR/JPY. I'm personally not trading these, but if you want to gamble a bit on it turning around this month, try ISM Manufacturing with a +/- 1.5 surprise (53.0 is expected) but only if you know what you're doing.

    2230 AU Interest Rate Decision (0.25% hike to 3.50% expected) - The market is not only expecting a hike, but also pricing in a 20% chance of a 0.50% hike to 3.75%. Because of this, there could be a risky opportunity for a short even with a small hike as expected, but the safer trade is on a no change or 0.50% hike.
    If they hike rates by 0.50% to 3.75%, AUD/USD should rally 70+ pips.
    If they keep rates unchanged at 3.25%, AUD/USD should fall 80+ pips.

    That's all for today's signal. If you'd like to learn more about trading or trade along with myself and my collegues, come join us at Profit Mongers. Our subscription is very reasonable at $179 per month, and right now you can sign up for a 2 week trial to get started for only $29. This offer is for new customers only.

    To our success!
    Sir Pipsalot
     
    #1 Sir Pipsalot, Nov 2, 2009
    Last edited: Nov 2, 2009
  2. sundown_858

    sundown_858 Recruit

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    SirPips,
    I'm super glad you're still going to be posting your analysis. I especially appreciate your overall analysis of where the equity markets are going. Very useful!

    Thanks again!
     
  3. Sir Pipsalot

    Sir Pipsalot Former FPA Special Consultant

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    Now that UK Manf PMI is over and quite bullish after the big Dip in GBP/USD, I think a long here around 1.6400 with a TP around 1.6520 or 1.6600 could work out rather well with a 50 pip SL.
     
  4. DTruth

    DTruth Recruit

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    Thank God!!!

    Sir Pips, I thought we've lost you.
    I think you should be decorated with medals of HONOR.
     
  5. Sir Pipsalot

    Sir Pipsalot Former FPA Special Consultant

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    Meh, trade looking tough depending on where you entered. A break of lows should stop things out no matter where you got in, but a turnaround here near 50 should keep things safe.
     
  6. mekino1000

    mekino1000 Recruit

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    Buy Gbp/usd @ 1.63800

    AM LONG GBP/USD AT 1.63700 WITH 40 pips SL. and 80 pips TP. hope it works.

    TNX GUYS, I made alot of cash at GBP PMI, Am skipping the USD news coming soon.I may even close shop for the day!:):shocked:
     
  7. josgab

    josgab Recruit

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    Good going

    It's good to know tat you are still around in a positive manner. Your trading signal is always very inciteful
     
  8. Sir Pipsalot

    Sir Pipsalot Former FPA Special Consultant

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    Stocks did swing up early to 1052, but couldn't hold on and have now given new, reassuring confirmation to the downside from a long term basis. I'm adding to my long term stock shorts here around 1030 on S&P futures. I'm now in about 60% of what I planned to enter, and I'm saving the other 40% for another day or two most likely.
     
  9. popularhelen

    popularhelen Recruit

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    thank God

    thank God we can at least read from you cant imagine fpa without reading your post
     

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