1. This site uses cookies. By continuing to use this site, you are agreeing to our use of cookies. Learn More.

Sir Pipsalot's Friday Market Update 04-23-2010

Discussion in 'Commercial Trade Journals' started by Sir Pipsalot, Apr 22, 2010.

  1. Sir Pipsalot

    Sir Pipsalot Former FPA Special Consultant

    Joined:
    Dec 11, 2007
    Messages:
    511
    Likes Received:
    0
    Hey folks,

    Well, I take a day off, and look what happens... lol. It looks like the EUR/USD didn't make it quite as far in it's retracement as I had thought. I was thinking 1.3800 and in the end it looks like we topped out there around 1.3690... so we got a 400 pip bounce instead of a 530 pip bounce... ah well. If you follow me, you know I feel that the Euro long term is headed much lower. I've even been so bold as to say may go as far as 1.0000 over the long term, but that's going to take quite awhile.I agree guys that the Euro long term is headed much lower. I've even been so bold as to say may go as far as 1.0000 over the long term, but that's going to take quite awhile. I thought the odds were better that we see some form of strong retracement higher relatively soon before the downtrend resumed, but with the break lower today, that reality seems to be changing.

    That said, the next major level to the downside on the EUR/USD is around 1.3087 which corresponds to the 78% retracement of the March to November rally. This level will eventually be broken, but it could be the springboard for a several hundred pip bounce, so be careful. If you're like me and you're not in short, but want to be... know that I plan to wait a bit. Forex is a 2 way street and it's a lot less stressful to get in on a downtrend after a rally than while price is sliding to new lows.

    Stocks seem to be building pressure for another thrust to new highs. I think a long from here around 1195 to 1200 on ESM0 (S&P 500 futures) with a SL just below today's lows around 1186 makes good sense with a TP around 1215-1220. The highs may be fleeting and turn south fairly easily, and with a big fib level in the spotlight at 1220, it may be magnetic, but it could be tough to break, so try not to expect much more than that.

    In news Thursday, we saw UK Retail Sales unforunately come out too close to expectations for a trade. In news Friday:

    0430 UK GDP preliminary q/q (0.4% expected) - This should be decent if we get a 0.2% deviation on both the q/q and y/y figures (expected at -0.1%).
    If it comes out at 0.6% or higher, GBP/USD should rally 40-50 pips.
    If it comes out at 0.2% or lower, GBP/USD should fall 40-50 pips.

    0700 CAD Core CPI m/m (0.0% expected) - CAD CPI has heated up as an indicator as they get closer and closer to making a tough call on raising interest rates. I would trade a 0.2% deviation as long as there aren't a lot of conflicts between the different CPI figures.
    If it comes out at 0.2% or higher, USD/CAD should fall 40 pips.
    If it comes out at -0.2% or lower, USD/CAD should rally 40 pips.

    0830 CAD Retail Sales, headline (1.0% expected) - The market tends to focus on the headline number more than the core number for retail sales in Canada. Unfortunately, we haven't seen a lot of decent surprises on this on in recent months. If we finally do we should see pretty decent price action, but look out for US Core Durable goods at the same time in case it messes with the USD side of the equation.
    If it comes out at 1.5% or higher, USD/CAD should fall 40 pips.
    If it comes out at 0.5% or lower, USD/CAD should rally 40 pips.

    That's all for today's update. 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. If you have any questions, you can also email me at sirpipsalot@profitmongers.com

    To our success!
    Sir Pipsalot
     

Share This Page