Pipcrawler

No pick for tonight. With the lack of any major news reports and as traders get ready for the holiday season, I don’t see any potential trading opportunites within the next few hours. We do have the Bank of England Meeting Minutes at 4:30 am EST, in which the market has predicted that it was a 9 – 0 vote to keep interest rates unchanged. This event does have market moving potential, as it may hint at future interest rate moves, but we will wait until after the report to see the markets reaction and if there are any potential trade opportunities. Until then stay tuned!

As expected, USD/CHF continued to drift lower and is now currently trading approximately at 1.2115. For those of you who stayed in the trade – good job! But, as we approach the Euro trading session, you may want to limit your risk by adjusting your stop loss, closing part of your position, or closing your trade all together.

Tonight’s Pick will be a continuation of yesterday’s short trade idea of USD/JPY after the US Current Account number was released. Again, we took off a small profit of 10 to 15 pips in the first half of our trade, move our stops to break even, and adjusted our pt1 to 117.70. We’ll see what happens after the BoJ interest rate decision and comments from BoJ Governor Fukui soon afterwards. So, we’ll keep our exit strategy the same and see what happens.

Update – 9:30 am EST

US CPI data has come and gone and we saw the dollar drop on flat CPI numbers. Unfortunately, it’s a little too late to jump in long at 1.2125 as i posted on my trade update. For those of you who did decide to buy at 1.2125, please set your target for 1.2180 which is coming up pretty quick at the current market price

I was expecting a higher number than expected, but today’s headline US Retail sales number for November came out at a whopping 1.0% higher, and the core number came out at 1.1% (For a more indepth analysis of today’s reports check out ). Pretty crazy!!!

Today’s trade will focus on US retail sales at 8:30 am EST, but before that we will take a look on how yesterday’s reports may affect today’s trade.

First, we saw a surprise as the US Trade Balance number was reported at -58.87 bln versus the consensus of -63.0 bln. We haven’t seen a figure that low since August 2005, and it is consistent with the uptrend in the past few reports.

We have so many different themes in the market – from the US economy, US pressure on China’s currency, rising commodity prices, etc – that many possible trade opportunities exist out there. But we do have the FOMC rate decision tomorrow at 2:15 pm EST, and we should see a muted trading environment as the market waits for the Fed’s outlook on inflation, the economy and future interest rate moves.

Today was a wild ride wasn’t it?? It was like those old FX days of crazy volatility that we haven’t seen much of lately. NFP came out pretty much in line with consensus, but there was a downward revision of Oct number to 79K from 92K. So, we saw some volatility after the NFP reports, but the mother of all moves came after US Treasury Secretary Paulson commented on how a “strong dollar” is in the best interest of the US, and how today’s reports was good news for the US economy.

Update: 10:37 am EST

Our short trade was triggered at 1.3350 and we hit pt1 for +40 pips….Holla! I closed out my position because this retracement may not move much further, but for those of you still in the trade I would adjust your stops to breakeven or close your position at your discretion.

We have the monster of all reports tomorrow in the US Non-Farm Payrolls! For this report, I usually wait until the number is released and guage the market reaction looking to fade the move, so that’s what we will do tomorrow.