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Sir Pipsalot's Monday Market Update 06-07-2010

Discussion in 'Commercial Trade Journals' started by Sir Pipsalot, Jun 7, 2010.

  1. Sir Pipsalot

    Sir Pipsalot Former FPA Special Consultant

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    Hey folks,

    The EUR/USD has sold off into the 1.1820 to 1.1995 region I had been looking for it to make a move towards since last Tuesday/Wednesday when I got short in the mid to high 1.2200's. I decided to safely take profits a bit early at 1.1995, but now we're comfortably in the middle of the target zone here around 1.1900 (1.1915 as I type). EUR/USD is likely to find some support and consolidate in this range as a wave 5 of 5 may be bottoming out and setting up for a larger retracement than we've seen. Things could always extend lower though, so try not to catch the falling knife too much here.

    Once I start to see bottoming price action confirming on the hourly chart, I'll shift into more of a buy on dips mode for short to medium term trades. For now, I'm neutral and standing aside on the Euro since I'm expecting support nearby, but it has yet to confirm as such.

    On stocks, it looks like I may have missed out picking the top on the retracement and 1108 was the peak of the bounce missing my sell range of 1110-1120 (my limit short order was at 1115). We obviously have some impulsive downwards price action with stronger downside potential, so that ratchets down the price I'm willing to get in to take a short to medium term stock short. Right now, I think a limit sell in the 1075-1085 range makes sense with a SL just above the 1108 swing high. I plan to TP again at 1045.

    Keep in mind you'll want to either close or roll-over any futures shorts on the June ESM0 contract and look to start trading the September contract ESU0 this Thursday or Friday. That's one of the reasons I have a single short target for this new limit short. The June contract will expire Friday 6-17, but becomes less liquid about a week beforehand.

    A break of 1035 on the S&P as I've been reiterating will be a major long term significant break that will confirm things enough to get me to enter a long term short trade looking for 100's of pips of follow-through over the next several months.

    In news Friday, we saw big action across the board. A slightly better than expected CAD Employment survey, coupled with a slightly better Unemployment Rate sent USD/CAD into a steady momentous uptrend. US NFP had a big -100K deviation, but the Unemployment Rate conflicted by a slight amount. As I previewed in Friday's signal, that actually set up for a buy scalp on USD/JPY in the first minute or two after the release, and indeed the USD/JPY rallied up about 30 pips from there over 10 minutes after the initial 60-70 point drop. If the Unemployment rate had been just a bit more positive, we likely would have seen a complete retracement. In any case, the Euro had already broken key lows before the report, so there was risk aversion in the air even before the numbers came out, and that continued afterwards.

    There's no economic news of note for either Monday or Tuesday. We'll get some Aussie and Kiwi data on Wednesday, but until then we'll just be working the trends and techs.

    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
     
  2. buffalobill

    buffalobill Recruit

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    Thanks for your much valued commentary Sir Pipsalot. I look forward to your signal and what next for the EURUSD - it's been in a very narrow range today.
     
  3. Tai

    Tai Recruit

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    Logic behind the Usd/Cad rally on better numbers

    Can u please explain as to why on a 10k better reading; Usd/Cad managed to a slow rally upward instead of a down ward rally on the last Frida's Cad Employment numbers?
    Thanks.
     

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