FX Trading Signals for Jan 04
1. Thursday, January 4th, 2007 (4:30 am New York Time) UK
We have Services PMI coming out of UK. This is the second most important indicator after UK PMI Manufacturing, and though this indicator can be tradable, it's very tricky. This indicator can deviate from consensus by 1 point and cause a big move of over 50 pips on the pound, and another month, it could deviate by the same 1 point, but cause a small quick blip of only a few pips. We really have to take into consideration the market sentiment during the London session before this report, price levels, and most recent history of this indicator. From April to August of 2006, this indicator was a on steady decline every single month until August. Back in August of 2006, this indicator came out at a record low of 56.7, and since then it was on a steady increase every month, peaking out in November at record high of 59.8. Tomorrow, this indicator will be released for the month of December. In December, most economists are expecting this indicator to come out very close to what it came out in November. So the expectations are that Services PMI will read approximately 59.5 or so. If Services PMI comes out at 57.9 or lower, it would be a significant drop from previous month, so I may possibly go short on GBP/USD. If it comes out at 61.0 or higher, it would set another record high, with a much higher reading than last month, so I may possibly go long on GBP/USD. If my triggers are hit, I expect GBP/USD to move by around 30 pips or more, however it may take about 5 minutes for the whole move to manifest.
2. Thursday, January 4th, 2007 (10:00 am New York Time) USA
Then we have U.S. ISM Non-Manufacturing index coming out of the U.S. Basically, this index is like Services PMI out of UK, but instead it measures services industry in the United States. This report is relatively young, compared to its brother ISM Manufacturing index, however this report is significantly older than UK Services PMI report. If the shock is sufficient this report can cause a nice move on the GBP/USD pair. Though, don't mistake this for the ISM Manufacturing report. This one is significantly less important. It's expected that this report will read at 57.0, after a big positive shock last month at 58.9. If this report comes out at 60 or above, I may possibly go short on GBP/USD, because it would be good for the dollar. If it comes out at 54 or below, I may possibly go long on GBP/USD, because it would be bad for the dollar.
We have Services PMI coming out of UK. This is the second most important indicator after UK PMI Manufacturing, and though this indicator can be tradable, it's very tricky. This indicator can deviate from consensus by 1 point and cause a big move of over 50 pips on the pound, and another month, it could deviate by the same 1 point, but cause a small quick blip of only a few pips. We really have to take into consideration the market sentiment during the London session before this report, price levels, and most recent history of this indicator. From April to August of 2006, this indicator was a on steady decline every single month until August. Back in August of 2006, this indicator came out at a record low of 56.7, and since then it was on a steady increase every month, peaking out in November at record high of 59.8. Tomorrow, this indicator will be released for the month of December. In December, most economists are expecting this indicator to come out very close to what it came out in November. So the expectations are that Services PMI will read approximately 59.5 or so. If Services PMI comes out at 57.9 or lower, it would be a significant drop from previous month, so I may possibly go short on GBP/USD. If it comes out at 61.0 or higher, it would set another record high, with a much higher reading than last month, so I may possibly go long on GBP/USD. If my triggers are hit, I expect GBP/USD to move by around 30 pips or more, however it may take about 5 minutes for the whole move to manifest.
2. Thursday, January 4th, 2007 (10:00 am New York Time) USA
Then we have U.S. ISM Non-Manufacturing index coming out of the U.S. Basically, this index is like Services PMI out of UK, but instead it measures services industry in the United States. This report is relatively young, compared to its brother ISM Manufacturing index, however this report is significantly older than UK Services PMI report. If the shock is sufficient this report can cause a nice move on the GBP/USD pair. Though, don't mistake this for the ISM Manufacturing report. This one is significantly less important. It's expected that this report will read at 57.0, after a big positive shock last month at 58.9. If this report comes out at 60 or above, I may possibly go short on GBP/USD, because it would be good for the dollar. If it comes out at 54 or below, I may possibly go long on GBP/USD, because it would be bad for the dollar.
posted by Naveen Pantera at 8:53 AM
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