Comdoll Trading Kit (April 2-6, 2012): Midweek Market Analysis

Can’t find a trade idea yet? Maybe you just need a recap on what market themes have been dominating markets so far this week! Here’s my list.

Market Themes

Manufacturing PMIs surprise to the upside… well, most of them, anyway
China’s stronger-than-expected PMI report set a bullish tone for high-yielding currencies early in the week, especially when it was followed up by upside surprises in the U.K. and U.S. ISM manufacturing PMI numbers. Good thing Japan’s Tankan PMI was largely ignored, as it printed a -4 reading for Q1 2012 against expectations of a 0 figure.

RBA to cut rates soon?
The RBA rained on the comdolls’ parade yesterday when it signaled a possible interest rate cut in the future. The central bank left its rates unchanged at 4.25%, but it also cited the euro zone and China’s growth concerns as downside risks to the economy. Will we see a rate cut soon?

FOMC minutes hits QE3 prospects
The dollar bulls partied in the streets when they heard that Big Ben and his gang aren’t thinking of QE3 as often as many economic hotshots are. The Fed even upgraded its inflation and growth forecasts, saying that additional stimulus is only necessary if the economy loses momentum and inflation remains below 2%. The question is, how long will the dollar’s rally last?

Comdoll Review

The Aussie, Loonie, and Kiwi gapped higher over the weekend after China printed a strong PMI report, and the comdolls mostly preserved its gains as more bullish reports popped up in markets.

Comdolls

Tuesday was another story, however, as the RBA printed a surprisingly dovish statement. AUD/USD dropped by at least 50 pips at the release of the report and continued to drop for the rest of the day. Meanwhile, falling oil prices also took its toll on the Loonie, which boosted USD/CAD above its intraweek lows.

Will the comdolls get their mojo back in the next couple of days? A lot of reports are still scheduled for release, so it’s still anybody’s game! What do you think?

Comdoll Event Highlights for April 2-6, 2012

Calendar

Among the comdolls, it looks like the Australian dollar is the most excited one to get the party started this quarter as the Land Down Under is set to release building approvals and retail sales data during the first couple of days of this week. On top of that, the RBA is also scheduled to make its rate decision on Tuesday, and this could be a big mover for the Aussie pairs.

The action will heat up for the Canadian dollar during the second half of the week as Canada will print its jobs data and Ivey PMI. Even though New Zealand doesn’t have a single report on tap, NZD/USD could still be in for a topsy-turvy ride since it’s NFP week after all!

Now let’s take a look at the significant inflection points on our comdoll charts:

Significant Levels to Watch Out For


AUD/USD USD/CAD NZD/USD
Week Open (WO)
1.0443
0.9962
0.8233
Previous Week High (PWH)
1.0558
1.0020
0.8265
Previous Week Low (PWL)
1.0305
0.9900
0.8116
Top Weekly ATR (tWATR)
1.0570
1.0042
0.8333
Bottom Weekly ATR (bWATR)
1.0316
0.9882
0.8133
Other significant levels
1.0450, 1.0200
0.9875, 1.0030
0.8100, 0.8270

In case you’re wondering what ATRs are all about and how I computed those figures, make sure you check out my entry explaining my trading strategies.

If you’ve got any trade setups you’d like to share, you know where to reach me!

@Happy_pip Twitter
Playing with Comdolls Facebook page
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MeetPips.com

Good luck in your trades this week, buddies!

Happy time

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