Sir Pipsalot's Thursday Market Update 06-17-2010

Sir Pipsalot

Former FPA Special Consultant
Hey folks,

EUR/USD has managed to make another dip, but this time the price action doesn't seem quite as encouraging. At this point I'd refrain from buying on this dip and tighten up any SL's on longs just below 1.2250. I expected a EUR/USD rally to 1.2450 based on it being the next important major resistance level, and an appropriate percentage retracement, but it looks like we're running out of steam on the hourly chart and we may need to head lower by 150-300 pips even if it is just to reload for another rally. So essentially for today, I'm neutral EUR/USD which means I'd be watching momentum on the 15m and hourly (as I've discussed in many prior signals) and looking for smart, tight trades there.

Stocks are starting to run out of steam as well, but they still likely have another 1-2 days of strength left in them. My plan is to short stocks around 1130 with a 50 pip SL (you could try it with a 20-25 pip SL if you want to keep it tighter). Hopefully we'll see 1130 by Friday to fill the sell order. If not, a different spot to try should become more apparent by then.

In news Wednesday, UK news came out a bit low, but not low enough to hit my sell trigger. Also, the small US news was a snoozefest unfortunately. In news Thursday:

0430 UK Retail Sales m/m Ex Fuel (0.1% expected) - There's still some uncertainty whether the traditional Ex Fuel number, or the new and buzz-worthy with Fuel reading will have more sway over the markets. For now it's probably best to stick with the more traditional Ex Fuel report. Keep in mind that in the last week or so, GBP/USD has been performing very well on news.
If it comes out at 0.6% or higher, GBP/USD should rally 50 pips.
If it comes out at -0.4% or lower, GBP/USD should fall 50 pips.

0830 US Core CPI m/m (0.1% expected) - This news hasn't been stellar lately on 0.1% deviations, so we'll have to hold out for a rare, but headline-worthy 0.2% deviation.
If it comes out at 0.3% or higher, USD/JPY should rally 30-40 pips
If it comes out at -0.1% or lower, USD/JPY should fall 30-40 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

To our success!
Sir Pipsalot
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