FX Trading Signals for Jan 31
1. Wednesday, January 31st, 2007 (5:30 am New York Time) SWITZERLAND
We have KOF Swiss Leading Indicator coming out, and it's expected to come out at 1.54 If the reading comes out at 1.34 or lower, that would match the lowest reading that came out all the way back in October of 2005, and would be short term bad for Swiss Frank, so I may possibly go long on USD/CHF. If the reading comes out at 1.75 or higher, that would be the first time in the last seven months, when this monthly indicator is actually coming out better than previous month. It's been on consistent decline since June of 2006. So a reading of 1.75 or higher, would mean a bounce back to November's reading or better, and it should be good for Swiss Frank short term, and I may possibly go short on USD/CHF.
2. Wednesday, January 31st, 2007 (8:15 am New York Time) USA
Then we have U.S. ADP Employment report coming out. This report is supposed to give hints of what non-farm payroll is, because it samples similar data as non-farm payroll, except much smaller amount of that data. However, it's had some very major screw ups, and was completely off base. Last month was another example, when ADP Employment came out at -40K, and Non-Farm payroll came out at 167K. It did provide an interesting situation. A lot of very serious traders took speculative dollar short positions before the non-farm, based on ADP reading, and they got totally creamed. My subscribers and I took dollar long position as soon as the number was released and most people got absolutely fantastic fills, because of that speculative dollar short liquidity, and we made a lot of pips. So to make the long story short, this ADP Employment is expected at 140K this month. If it comes out at 200K or more, I may possibly go short on GBP/USD. If it comes out at 50K or less, I may possibly go long on GBP/USD. This will probably be a relatively short move. In addition to trading the initial spike on this report, you can also try to trade first retracement strategy that's mentioned in my free signals tutorial video in the beginning of this email.
3. Wednesday, January 31st, 2007 (8:30 am New York Time) USA
Then we have US GDP coming out of the U.S. It'll be the first GDP estimate for 4th quarter, and it's expected to have a relatively strong reading of 3.0%. If the reading is at 3.5% or higher, it should be good for the dollar short term, so I may possibly go short on GBP/USD. If the reading is at 2.5% or lower, it should be bad for the dollar short term, and I may possibly go long on GBP/USD. If my triggers are hit, I am expecting a move of at least 50 pips on GBP/USD. In addition to the initial spike, you can also try to catch the second wave, and second wave retracement, that are explained in my free signals tutorial video in the beginning of this email.
4. Wednesday, January 31st, 2007 (10:00 am New York Time) USA
Then we have Chicago PMI coming out at 52. If it comes out at 50 or lower, it would signify that there is no expansion in this particular reading, because a reading of 50, signifies that 50% of manufacturers reported expansion, and the other 50% reported contraction. A reading below 50 would signify contraction in this sector. So if it reads at 50 or below, I may possibly go long on GBP/USD, since it would be bad for the dollar short term. If the reading is at 55.0 or higher, it would be extremely unexpectedly high reading. I've looked at opinions of around 60 different economists, and not one is expecting a reading of better than 55. So such reading would be a surprise, and I may possibly go short on GBP/USD, since it would be good for the dollar short term. In addition to the spike, you can try trading the 2nd wave strategy if you like, that's mentioned in my tutorial video, keep in mind 100% retracement possibility on this one.
5. Wednesday, January 31st, 2007 (2:15 pm New York Time) USA
We have FOMC interest rate decision out of U.S. It's expected that interest rate will stay the same, at 5.25%. If for some reason, the interest rate is hiked to 5.50%, it would be good for the dollar, and I may possibly go short on GBP/USD. If the interest rate is lowered to 5.00%, I may possibly go long on GBP/USD, because it would be bad for the U.S. dollar. It's extremely unlikely that the Fed will do anything with the rates. The housing market is starting to rebound, inflation seems to show first signs of slowing, so I think the Fed will consider current rate perfect for the time being. However, even if they keep the rate unchanged, but mention something about a possibility of another rate hike in the near future, that would be bullish for the dollar, so short on GBP/USD. Or if they mention a possibility of a cut coming, it would be bearing for the dollar, so a long on GBP/USD. If for some reason a rate is raised or cut, I would expect a move of at least 100 to 150 pips on GBP/USD pair, and in addition to trading the spike, you can trade a 2nd wave strategy.
We have KOF Swiss Leading Indicator coming out, and it's expected to come out at 1.54 If the reading comes out at 1.34 or lower, that would match the lowest reading that came out all the way back in October of 2005, and would be short term bad for Swiss Frank, so I may possibly go long on USD/CHF. If the reading comes out at 1.75 or higher, that would be the first time in the last seven months, when this monthly indicator is actually coming out better than previous month. It's been on consistent decline since June of 2006. So a reading of 1.75 or higher, would mean a bounce back to November's reading or better, and it should be good for Swiss Frank short term, and I may possibly go short on USD/CHF.
2. Wednesday, January 31st, 2007 (8:15 am New York Time) USA
Then we have U.S. ADP Employment report coming out. This report is supposed to give hints of what non-farm payroll is, because it samples similar data as non-farm payroll, except much smaller amount of that data. However, it's had some very major screw ups, and was completely off base. Last month was another example, when ADP Employment came out at -40K, and Non-Farm payroll came out at 167K. It did provide an interesting situation. A lot of very serious traders took speculative dollar short positions before the non-farm, based on ADP reading, and they got totally creamed. My subscribers and I took dollar long position as soon as the number was released and most people got absolutely fantastic fills, because of that speculative dollar short liquidity, and we made a lot of pips. So to make the long story short, this ADP Employment is expected at 140K this month. If it comes out at 200K or more, I may possibly go short on GBP/USD. If it comes out at 50K or less, I may possibly go long on GBP/USD. This will probably be a relatively short move. In addition to trading the initial spike on this report, you can also try to trade first retracement strategy that's mentioned in my free signals tutorial video in the beginning of this email.
3. Wednesday, January 31st, 2007 (8:30 am New York Time) USA
Then we have US GDP coming out of the U.S. It'll be the first GDP estimate for 4th quarter, and it's expected to have a relatively strong reading of 3.0%. If the reading is at 3.5% or higher, it should be good for the dollar short term, so I may possibly go short on GBP/USD. If the reading is at 2.5% or lower, it should be bad for the dollar short term, and I may possibly go long on GBP/USD. If my triggers are hit, I am expecting a move of at least 50 pips on GBP/USD. In addition to the initial spike, you can also try to catch the second wave, and second wave retracement, that are explained in my free signals tutorial video in the beginning of this email.
4. Wednesday, January 31st, 2007 (10:00 am New York Time) USA
Then we have Chicago PMI coming out at 52. If it comes out at 50 or lower, it would signify that there is no expansion in this particular reading, because a reading of 50, signifies that 50% of manufacturers reported expansion, and the other 50% reported contraction. A reading below 50 would signify contraction in this sector. So if it reads at 50 or below, I may possibly go long on GBP/USD, since it would be bad for the dollar short term. If the reading is at 55.0 or higher, it would be extremely unexpectedly high reading. I've looked at opinions of around 60 different economists, and not one is expecting a reading of better than 55. So such reading would be a surprise, and I may possibly go short on GBP/USD, since it would be good for the dollar short term. In addition to the spike, you can try trading the 2nd wave strategy if you like, that's mentioned in my tutorial video, keep in mind 100% retracement possibility on this one.
5. Wednesday, January 31st, 2007 (2:15 pm New York Time) USA
We have FOMC interest rate decision out of U.S. It's expected that interest rate will stay the same, at 5.25%. If for some reason, the interest rate is hiked to 5.50%, it would be good for the dollar, and I may possibly go short on GBP/USD. If the interest rate is lowered to 5.00%, I may possibly go long on GBP/USD, because it would be bad for the U.S. dollar. It's extremely unlikely that the Fed will do anything with the rates. The housing market is starting to rebound, inflation seems to show first signs of slowing, so I think the Fed will consider current rate perfect for the time being. However, even if they keep the rate unchanged, but mention something about a possibility of another rate hike in the near future, that would be bullish for the dollar, so short on GBP/USD. Or if they mention a possibility of a cut coming, it would be bearing for the dollar, so a long on GBP/USD. If for some reason a rate is raised or cut, I would expect a move of at least 100 to 150 pips on GBP/USD pair, and in addition to trading the spike, you can trade a 2nd wave strategy.
posted by Naveen Pantera at 2:49 PM
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