Profit Mongers – Monday Trading Signal 08-02-2010

Posted on 02. Aug, 2010 by Sir Pipsalot in Forex Signals, How To, Random Noise

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Hey folks,

My upwards bias on EUR/USD from last week still holds pat. We are testing resistance just ahead of 1.3100, but that resistance should fail and we’ll see another push higher. My best guess is 1.3250 in the next 1-2 days. A decline to 1.2950 or below would negate this forecast, so try buying on dips or shorter target momentum trades following a breakout higher.

GBP/USD may be an even better long than EUR/USD right now. It’s looking quite bullish. I think a buy on dip would be quite opportune if it develops, so I’d look to buy in the 1.5665-1.5685 area with a 50 pip SL and 50-150 pip TP’s.

Stocks consolidated a bit and dipped lower as anticipated, but I’ve remained steadfast that this dip is still a good one to buy into short to medium term. I remain long from around 1100 with 1115 and 1125 TP’s with SL just below Friday’s lows. Remember though, once we get that last push higher (likely to top around 1130), it will set up for a great short medium to long term.

In news Friday, even a tiny disappointment on US GDP sent USD/JPY lower by 45 pips over 10 minutes or so. Chicago PMI saw 38 pips up, about half came early from 09:42 to 09:45, with the rest coming over the next 5-10 minutes. In news Monday:

2130 AU Retail Sales m/m (0.4% expected) – As long as this agrees with the quarterly Ex inflation Retail Sales (0.7% expected), we should see a good move here with the Interest Rate decision just 3 hours afterwards. There should be a lot of eyes on this report and on the AUD/USD during the late Asian session.
If it comes out at 0.8% or higher, AUD/USD should rally 40 pips.
If it comes out at 0.0% or negative, AUD/USD should fall 40 pips.

00:30 EST (Monday night/Tuesday Morning) AU Interest Rate Statement (no change at 4.50% unanimously expected) – The RBA has been on hold now since their last hike May 4th and recent rhetoric has shown little indication they plan to budge anytime soon. However, their inflation figures did come out higher than expected across the board, so they could come out with a surprise hike, or at least a shift towards a more hawkish stance hinting at another hike soon. Look for other fundamental traders to be anticipating the same thing leading to some prenews bullish price action.
–Prenews – Try going long AUD/USD 1-2 hours before the release and close all or 1/2 1-2 minutes prior.
–If they hike at all, AUD/USD should rally 50-100 pips.
–If they shift towards a more hawkish stance or allude to future hikes, AUD/USD should rally 40-50 pips.
–If they maintain a very neutral tone, AUD/USD may dip 30-50 pips if it looks like long speculators had piled in ahead of the news. If there wasn’t bullish price action in the 1-2 hours before the news, consider this outcome a no trade.

Related posts:

1. Profit Mongers – Monday Trading Signal 08-23-2010
2. Profit Mongers – Monday Trading Signal 05-31-2010
3. Profit Mongers – Monday Trading Signal 09-27-2010
4. Profit Mongers – Monday Trading Signal 10-12-2010
5. Profit Mongers – Wednesday Trading Signal 07-28-2010

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