Forex Fundamental Analysis - 26 February 2008

Fundamental Analysis

Tuesday, February 26th, 2008 (4:00 a.m. New York Time) GERMANY
At 4:00 a.m. we will have German IFO coming out. I don't recommend trading that.

Tuesday, February 26th, 2008 (8:30 a.m. New York Time) USA
At 8:30 a.m. we will have U.S. Core PPI m/m. This is a quite small indicator. It is expected to come out at 0.2%. In order to move the market, we would need to have a large deviation here. I would enter a trade with 0.2 deviation on Core PPI supported by 0.5 deviation in the same direction on headline. If the core goes the other way than the headline, or headline is just as expected, probably you would want to exit the trade rather sooner than later. Having said all that, if the core PPI m/m comes out at 0.4% or higher, I would sell GBP/USD and look for about 35 pips. If it comes out at 0% or negative, you may want to buy GBP/USD and also look for 35 pips move.

Tuesday, February 26th, 2008 (9:00 a.m. New York Time) USA
At 9 a.m. we will have U.S. S&P C20 House Price Index coming out. It is expected to come out at -9.7. I would enter only on positive deviation unless there is a great opportunity to enter at negative deviation. If it comes out at -9.3 or less negative, I would buy USD/JPY and look for 25 to 35 pips. I don't have a trigger for a negative deviation so I would say it would be a no trade - unless there is something crazy going on.

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Forex Fundamental Analysis - 22 February 2008

Fundamental Analysis

Friday, February 22nd, 2008 (8:30 a.m. New York Time) CANADA
At 8:30 a.m. we will have Canadian Retail Sales coming out. I recommend trading the headline number but be aware if there is a conflict, the initial spike may be in direction of headline but then it may be muted or go the other way depending on numbers. I think 0.6 trigger can be used because every time we had 0.6 deviation or greater, we had pretty good price actions. It is expected it will came out at 0.7 (or sometimes 0.8). If the headline comes out at 1.4%, you may sell USD/CAD and look for 35 to 40 pips. If it comes out 0.2% or lower, you may want to buy USD/CAD and expect 35 to 40 pips in the first hour of the report.

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Forex Fundamental Analysis - 21 February 2008

Fundamental Analysis

Thursday, February 21st, 2008 (4:30 a.m. New York Time) UK
At 4:30 a.m. we will have U.K. Retail Sales m/m coming out. It is expected to come out at 0.25% (some people say 0.2% and some 0.3%). If it comes out at 0 or negative, I think it would be a good sell signal on GBP/USD or GBP/JPY, looking for 50 pips of a price action in a first hour of the report. If it comes out at 0.5% or more positive, I would recommend to buy GBP/USD or GBP/JPY. For more details how the price moved in the past, please watch the video.

Thursday, February 21st, 2008 (8:30 a.m. New York Time) USA
At 8:30 a.m. we will have U.S. Initial Jobless Claims. It is expected to come out at 349 K. If it comes out at 370K or more, sell USD/JPY and look for 30 to 35 pips move. If it comes out at 330K or lower, I would buy USD/JPY and look for 30 to 35 pips move.

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Forex Fundamental Analysis - 20 February 2008

Fundamental Analysis

Tuesday, February 20th, 2008 (4:30 a.m. New York Time) UK
At 4:30 a.m. we will have BOE Minutes coming out. The consensus is between 7:2 to 9:0. Majority of economists expect, however, 9:0 vote. I think if the vote is NOT 9:0 but 6:3 or 7:2, it would be worthy to buy GBP/USD. For 8:1 or 9:0 it would be a no trade. There is no sell opportunity for this report unless you know how to analyze the commentary.

Tuesday, February 20th, 2008 (8:30 a.m. New York Time) USA
At 8:30 a.m. we will have U.S. CPI X Food & Energy m/m, and Building Permits and House Starts. My only concern is if we get dollar weakening CPI number and good numbers from the housing market (positive deviation of 100 or more), then it may move the market the other way. Let's assume there is no major conflict. If the CPI comes out at 0.3% or higher, I think it would be a sell opportunity for GBP/USD. If it comes out at 0.1% or lower, it would be a buy opportunity for the GBP/USD. Either case, I would look for 40 to 50 pips or more in the first 1 hour of the report.

Tuesday, February 20th, 2008 (2:00 p.m. New York Time) USA
At 2 p.m. we will have U.S. FOMC Minutes. This is not for beginners. If you are interested to trade it, watch the video.

Tuesday, February 20th, 2008 (7:30 p.m. New York Time) AUSTRALIA
At 7:30 p.m. we will have some wage data out of Australia. I will skip this one.

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Forex Fundamental Analysis - 19 February 2008

Fundamental Analysis

Tuesday, February 19th, 2008 (3:30 a.m. New York Time) SWEDEN
At 3:30 a.m. we will have Swedish CPI. You would need to have USD/SEK or EUR/SEK to trade this; if you don't have such pairs, skip this report. There are 4 numbers coming out: CPI Underline Inflation m/m and y/y, and CPI Headline m/m and y/y. I will focus on Underline Inflation y/y. If it comes out at 2.5% or higher, I would sell EUR/SEK. If it comes out at 2.1% or lower, I would buy EUR/SEK. I would expect at least 300, most likely 400 to 500 pips on a tradable deviation. Keep in mind that such pairs make a lot of pips but there is very little money per pip.

Tuesday, February 19th, 2008 (7:00 a.m. New York Time) CANADA
At 7:00 a.m. we will have CAD Core CPI m/m. It is expected to come out at 0.1%. If it comes out at 0.3% or higher, I would sell USD/CAD and I would expect 30 to 40 pips on initial spike, and 50 to 55 pips total in the first hour of the report. If it comes out -0.1%, I would buy USD/CAD and look for same targets. Avoid conflicts on headline m/m and core m/m as when it conflicts, it may move a little and then change the direction completely.

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Forex Fundamental Analysis - 14 February 2008

Fundamental Analysis

For Initial Jobless Claims at 8:30, buy USD/JPY if it comes out 327K or lower,
and sell USD/JPY if it comes out 367K or higher looking for 35 pips or more on
the USD/JPY.  As far as US and Canada Trade Balance is concerned, I think we're
better off leaving those alone.  Also, there'sNZ Retail Sales at 16:45 expected
in at +0.1%.  I plan to cautiously trade this one with a 0.6 trigger looking to
buy NZD/USD if it comes out at 0.7%or higher, and sell it if it comes out at
-0.5% or more negative.

Just be wary about the release time just minutes before the NY close/rollover
order flows that could potentially mute or hurt the price action.

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Forex Fundamental Analysis - 13 February 2008

Fundamental Analysis

Wednesday, February 13th, 2008 (3:30 a.m. New York Time) SWEDEN
At 3:30 a.m. we are going to have Sweden Interest Rate statement. It is expected to come out at 4%. If they hike, you want to sell EUR/SEK, if they cut, you may buy EUR/SEK.

Wednesday, February 13th, 2008 (4:30 a.m. New York Time) UK
At 4:30 a.m. we will have UK Average Earnings (without bonus). It is expected to come out at 3.9%. If it comes out at 4.1% or higher, I would be worth to buy GBP/USD, looking for 40 pips in the first hour of the report. If it comes out at 3.7% or lower, then I would sell GBP/USD, looking for 40 pips in the first hour.

Wednesday, February 13th, 2008 (5:30 a.m. New York Time) UK
At 5:30 a.m. we will have BOE quarterly inflation report. It may move market but if you are unexperienced, stay away from it.

Wednesday, February 13th, 2008 (8:30 a.m. New York Time) USA
At 8:30 a.m. we will have U.S. Retail Sales X Autos coming out. Last time we were trading it with 0.5 trigger and it worked beautifully with USD/JPY but GBP/USD and EUR/USD had tough moves. This time I will be using 0.5 trigger again, and again I will focus on USD/JPY. It is expected it will come out at 0.2%. If it comes out at 0.7% or higher, I would buy USD/JPY. If it comes out at -0.3% or more negative, I would sell USD/JPY. When the trigger is hit, I would expect 35 pips of price action but it can be much more after a few hours, like last month we saw over 100 pips move.

Wednesday, February 13th, 2008 (6:50 p.m. New York Time) JAPAN
At 6:50 p.m. we will have GDP out of Japan which I don't recommend to trade.

Wednesday, February 13th, 2008 (7:30 p.m. New York Time) AUSTRALIA
At 7:30 p.m. we will have Australian Employment Change. Be aware of any possible conflicts here. It is expected that the employment change will come out at 15K. If it comes out at 30K or higher, I would buy AUD/USD. If it comes out at 0K or negative, I would sell AUD/USD. If the trigger is hit, I would look for 30 to 40 pips ore more of price action

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Forex Fundamental Analysis - 12 February 2008

Fundamental Analysis

Tuesday, February 12th, 2008 (4:30 a.m. New York Time) UK
At 4:30 a.m. we will have UK CPI coming out. There will be a lot of speculations about high inflation because the PPI just came out record high today. However, historically there was not any strong relationship between big CPI and big PPI numbers. The headline CPI is expected to come out at 2.3%. Sell trigger will be more safe because if the CPI comes out low, it would be a big surprise so I will widen a buy trigger a little bit. If it comes out at 2.6% or higher (on y/y headline), then I would buy GBP/USD, looking for 40 to 50 pip of a price action in the first hour. If it comes out at 2.1% or lower, I would sell GBP/USD and look for 40 to 50 pips as well. If it comes out at 2.2% it may still be enough to sell but it will all depend on pre-release price action. If you want to play safe, stick with 2.1% trigger.

Tuesday, February 12th, 2008 (5:00 a.m. New York Time) GERMANY, EURO ZONE
At 5:00 a.m. we will have German ZEW. I would not worry to much about it; sometimes it moves a little, some other times it is a waste of time. If it is going to deviate extremely high like PPI today, then you would get some price action but such miracles happen once a blue moon.

Tuesday, February 12th, 2008 (4:45 p.m. New York Time) NEW ZEALAND
At 4:45 p.m. we will have New Zealand PPI but it also will not create big moves unless the deviation is huge. If you have nothing better to do, you can look for crazy deviations.

Tuesday, February 12th, 2008 (7:01 p.m. New York Time) UK
At 7:01 p.m we will have UK RICS House Price Balance which may be a good one to get a few pips out of it. It is expected to come out at -52%. -50% is kind of low, you will not see -80% or -90%, so they expect record low this month. I would trade it with 5% trigger. If we see -57% or more negative, I would be selling GBP/JPY, looking for 40 to 60 pips in a first hour of the report. If it comes out at -47% or less negative, I would buy GBP/JPY and look for 40 to 60 pips. We may even see 100 pips move.

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Forex Fundamental Analysis - 11 February 2008

Fundamental Analysis

Monday, February 11th, 2008 (4:00 a.m. New York Time) Norway
First, we will have Norway CPI y/y. If you have never traded Norway or Swedish reports, don't worry too much about it. You can use 0.3 trigger so if it comes out at 3.9% or higher, you want to sell USD/NOK or EUR/NOK. If it comes out 3.3% or lower, you can buy USD/NOK or EUR/NOK. Keep an eye on the underline inflation that is expected to be at 2.1%. When the trigger is hit, expect 300 to 400 pips move but keep in mind that spreads are higher so you must trade a few times smaller lot sizes on these reports. Do NOT trade it if you don't know what you are doing. If it is your first time, either trade very small or just observe.

Monday, February 11th, 2008 (4:30 a.m. New York Time) UK
At 4:30 a.m. we will have UK Trade Balance coming out. It is expected to come out at -740 M (-7.4 B). We will also PPI coming at the same time. To be honest, I would skip this report unless you can process everything quickly. You need to have everything in one direction in order to enter the trade, and by the time everything is coming out, it may be too late to enter the trade. UK Trade Balance on its own has been performing poorly lately, and the PPI has never been in focus at all. I would leave this alone.

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Forex Fundamental Analysis - 08 February 2008

Fundamental Analysis

Friday, February 08th, 2008 (1:45 a.m. New York Time) SWITZERLAND
We at 1:45 a.m will have Swiss CPI coming out. It is expected to come out at -0.5%. I would trade y/y number which is expected to come out at 2.2%. I would trade it with 0.3 trigger so if it comes out at 2.5% or higher, I would sell USD/CHF, looking for 25 to 30 pips of a price action. If it comes out at 1.9% or lower, you may consider buying USD/CHF, looking for 25 to 30 pips of a price action. This one moves very SLOW so you can set up your SL 5 pips below prerelease and wait patiently for 25 to 30 pips of a price action.

Friday, February 08th, 2008 (7:00 a.m. New York Time) CANADA
At 7 a.m. we will have Employment Change out of Canada. It is expected to come out at 10K. We had 4 months in a row with big triggers, and 3 out of 4 moved the market by 100 pips so it is a big trading opportunity. I would trade 15 K trigger on this. If it comes out at 25K or higher, you may want to sell USD/CAD, looking for 30 to 40 pips of a price action. If it comes out at -5K or lower, then you want to buy USD/CAD, looking for 30 to 40 pips of a price action. If it hits wider trigger like 30K deviation, the price move may double or even triple.

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Forex Fundamental Analysis - 07 February 2008

Fundamental Analysis

Thursday, February 07th, 2008 (4:30 a.m. New York Time) UK
At 4:30 a.m. New York time we will have UK Industrial Production coming out. To stay safe, especially because of the Interest Rate statement coming out later on, I will use 0.4 trigger on this. If it comes out at 0.6% or higher, I would consider buying GBP/USD, looking for 35 to 40 pips. If it comes out -0.2 or lower, then I would sell GBP/USD, looking for 35 to 40 pips as well.

Thursday, February 07h, 2008 (7:00 a.m. New York Time) UK
At 7:00 a.m. we will have UK Interest Rate decision coming out. It is widely expected they will cut the rates from 5.50% to 5.25%. Right now, the market is completely priced in. The only way to trade this one is to place the trade if they do NOT cut the rate or if they do cut the rates by 50 bp. If they cut to 5.00%, then you can sell GBP/USD and expect about 50 pips price action. I would not trade GBP/JPY because the rate cut would actually help equity market relief. If it comes out at 5.50% (so no cut), I would buy GBP/USD and look for 50 pips of the price action within 15 minutes to 1 hour.

Thursday, February 07h, 2008 (7:45 a.m. New York Time) EUROZONE
At 7:45 a.m. we will have Eurozone Interest Rate statement. It is widely expected they will leave the rates unchanged at 4.00%. If they cut by 25 bp which is pretty unlikely, then you can sell EUR/USD, looking for 45 to 50 pips, at least - maybe even 100 pips.

Thursday, February 07h, 2008 (8:30 a.m. New York Time) EUROZONE
At 8:30 a.m. we will have Trichet speech. In my opinion, writing it here would be very confusing for most people. If you are interested, watch the video, and make sure you know what you are doing. This is not for beginners.

Thursday, February 07h, 2008 (10:00 a.m. New York Time) USA
At 10:00 a.m. we will have U.S. Pending Home Sales. I would stay away from it.

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Forex Fundamental Analysis - 06 February 2008

Fundamental Analysis

Wednesday, February 06th, 2008 (8:30 a.m. New York Time) CANADA
At 8:30 a.m. we will have Canadian Building Permits coming out. I would trade it with 5 deviation. If we get 4.5% or higher on Canadian building permits, you want to sell USD/CAD for 30 pips or so in the first 15 minutes of the report, and maybe 40 to 50 pips in the first hour. If it comes out at -5.5% or more negative, I would buy USD/ CAD and look for 30 pips in the first 15 minutes, and about 40 to 50 pips in the first hour of the report.

Wednesday, February 06th, 2008 (10:00 a.m. New York Time) CANADA
At 10:00 a.m. we will have Canadian Ivey PMI coming out. Last month it came out at -6.1 deviation and it moved almost 100 pips in the first 15 minutes so it was a huge appreciation on the USD/CAD. Although we had ISM Non-Manufacturing at the same time, it came out very close to expectations so that was a no trade. Sometimes this report is worthy 20 to 30 pips, but some other times it moves much more. It is going to come out at 47, and I am recommending using a 5 trigger on this. If it comes out at 52 or higher, you may want to sell USD/CAD and look for about 30 pips of the price action, potentially more. If it comes out at 42 or less, you may want to buy USD/CAD and look for 30 pips or more.

Wednesday, February 06th, 2008 (4:45 p.m. New York Time) NEW ZEALAND
At 4:45 p.m. we will have New Zealand Unemployment Rate & Employment Change coming out. It used to be Unemployment Rate moving the market as they never announcement employment change number but they started announcing quarterly employment change since last August, and on November we saw a conflict on it, and Employment Change dominated the price action. I would trade Employment Change with 0.4% so if it comes out flat at 0.0% or lower, then sell NZD/USD looking for 30 pips of the price action. If it comes out at at 0.8% or higher, then you may want to buy NZD/USD and look for 30 pips of the price action to the upside.

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Forex Fundamental Analysis - 05 February 2008

Fundamental Analysis

Tuesday, February 05th, 2008 (3:00 a.m. New York Time) UK
At 3 a.m. EST there is UK Housing Indicator coming out. This one gives a decent opportunity to do some scalps. It is expected to come out at -0.4%, last month it came out at 1.3%. Last month you could be able to make 20 to 25 pips. If it comes out at -1.3%, I think it is low enough to sell GBP/USD. If it comes out at 1.5% or higher, that would be the best number since August, and that would be sufficient enough to cause GBP/USD strength. I would expect 25 to 30 pips price action in the first 30 minutes of the report although recently it is getting more focus on so it could be even more pips if the trigger is hit.

Tuesday, February 05th, 2008 (4:30 a.m. New York Time) UK
At 4:30 a.m. EST we will have UK Services PMI. That was is definitely tradable. Last month we had -0.8 deviation and it gave a great price action of 60 to 70 pips or so. I definitely would want to trade it. Usually I trade 1.0 trigger on it but I will give two triggers for this report. This report tends to move up and down and then up and down 25 pips with smaller deviations. If you are able to make money on it, I think trading 0.8 trigger so buying GBP/USD on 52.8 or higher, and sell GBP/USD at 51.2 or lower on the release. In this case, just take whatever market gives and exit. If it deviates by 1.5 trigger, I think it would be a good idea to hold your position for a longer time. So, if it comes out at 53.5 or higher, it would be more conservative buy trigger on the GBP/USD, and if it comes out at 50.5 or lower, it would be a conservative sell signal on GBP/USD.

Tuesday, February 05th, 2008 (3:00 a.m. New York Time) USA
At 10 a.m. we will have U.S. ISM Non-Manufacturing. Not the best indicator but you can try to scalp a few pips. It is expected to come out at 53.0. If it comes out at 54.5 or higher, you can go long on USD/JPY, looking for 20 pips price action. If it come out at 51.5 or lower, you can try to sell USD/JPY and expect 20 to 25 pips of the price action.

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Forex Fundamental Analysis - 04 February 2008

Fundamental Analysis

Monday, February 04th, 2008 (4:45 p.m. New York Time) NEW ZEALAND
At 4:45 p.m. New York time we will have New Zealand Labor Cost q/q. It is a new indicator so it is kind of hard to predict how it is going to perform. It is expected to come out at 0.9% and I would use 0.2 trigger on it. If it comes out at 1.1% or higher, I would consider buying New Zealand dollar or at least watch it. I am not sure what kind of price action we would get, I am thinking of 25 pips or so. If it comes out low at 0.7% or lower, you may want to sell New Zealand dollar, and expect 20 to 25 pips or so. Watch out for any possible conflicts with Average Earnings that are supposed to come out at 0.8% so in case of conflict just stay out. If you don't want to trade it which is very understandable, at least watch the price action and see what will happen.

Monday, February 04th, 2008 (7:30 p.m. New York Time) AUSTRALIA
At 7:30 p.m. New York time we will have Australian Retail Sales. The interest statement that will be announcement a few hours later can either make this report stronger or weaker but most likely it is going to make it less important. Last month 0.3 deviation created great price actions; however, I would like to be more conservative here. I will be trading 0.4 trigger just because of that interest rate statement. Keep a closed eye on the Retail Sales X Inflation q/q that is expected to come out at 1.1% - make sure there is no conflict there. The retail sales m/m is expected at 0.6%, and it it comes out at 1.0%, I would buy AUD/USD and look for 25 to 35 pips of the price action. It if comes out at 0.2% or lower, I would sell AUD/USD and look for 25 to 35 pips of price action. Avoid conflicts there.

Monday, February 04th, 2008 (10:30 p.m. New York Time) AUSTRALIA
At 10:30 p.m. we will have Australian Interest Rate statement coming out. They are expected to raise rates from 6.75 to 7.00%. About 8% of economists expect them to leave the rate unchanged. If they leave the rate unchanged, it would be a sell signal on AUD/USD and AUD/JPY, and expect 50 to 70 pips of the price action. If they hike the rates to 7.00%, the reaction will mostly depend on the commentary. They should comment whether they will hike or not, so keep pay attention to it.

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Forex Fundamental Analysis - 31 January 2008

Fundamental Analysis

Thursday, January 31st, 2008 (2:00 a.m. New York Time) UK
At 2 a.m. we will have UK Nationwide House Price m/m coming out. It is expected to come out at -0.4%. I would use 0.3 trigger on this one. Keep in mind that this is a quite new indicator so don't be so sure with your decisions and consider smaller profit targets like 10 to 20 pips, If it continues going on, so be it. If it gives a really good number such as 0.6 trigger, you may try to put a long term sell trade on EUR/GBP and try to bank 100 pips over the time, or if it comes very low, you may want to buy GBP/EUR for a long term position. In the short term we trade I would use 0.3 trigger. If it comes out at -0.1% or better (0 or positive), I would look to buy GBP/USD or GBP/JPY, and expect 25 to 30 pips of the price action on GBP/USD. If it comes out lower than expected, such as -0.7 or more negative, I would sell GBP/USD or GBP/JPY for a similar price action.

Thursday, January 31st, 2008 (5:00 a.m. New York Time) EURO ZONE
At 5 a.m. we will have Eurozone Estimate CPI y/y. I would trade this with 0.2 trigger. If it comes out at 3.3% or higher, you want to buy EUR/USD, and 2.9% or lower you want to sell EUR/USD, looking for 25 pips or more in the first half hour of the report.

Thursday, January 31st, 2008 (8:30 a.m. New York Time) CANADA
At 8:30 a.m. we will have Canadian GDP coming out. I would trade it with 0.2 trigger. If it comes out 0.4% or higher, I would sell USD/CAD, looking for 30 pips or so of the price action. If it comes out at 0 or negative, that would be weakening the Canadian dollar, and I would buy USD/CAD and look for 30 pips or so of the price action. Some people may want to trade EUR/CAD because of the U.S. reports coming out at the same time but keep in mind that if the U.S. report moves EUR/USD, it will also affect EUR/CAD.

Thursday, January 31st, 2008 (8:30 a.m. New York Time) USA
At 8:30 a.m. we will also have U.S. Core PCE. If it deviates by 0.2 which happens very rarely, it will move the market as well. If it comes out at 0.4% or higher, that is going to be strengthening for the U.S. dollar, and you can go short on EUR/USD or GBP/USD, looking for 25 to 35 pips of price action. If it comes out at 0 or negative, that would be weakening for the U.S. dollar, and you want to go long on EUR/USD or GBP/USD, whichever looks better at that time. Of course, if you have all other indicators in line deviating the same way, it may move the market even more.

Thursday, January 31st, 2008 (8:30 a.m. New York Time) USA
Also at 8:30 a.m. we will have U.S. Initial Jobless claims coming out. It is expected to come out at 320 K. If there is a 20 K trigger on the initial jobless claims, you may consider entering the trade. If it comes out at 340 K or higher, that would be weakening the U.S. dollar, and I would trade USD/JPY on that ASSUMING THERE ARE NO CONFLICTS, and I would sell the USD/JPY. If it comes out at 300 K or lower, that would be third month in the row it is lower, and it would be a very positive indication that jobs are doing OK, and I would buy USD/JPY on this, expecting around 30 pips of the price action.

Thursday, January 31st, 2008 (9:42 a.m. New York Time) USA
At 9:42 a.m. we will have Chicago PMI. Not a great indicator so I will not be paying attention to it.

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Forex Fundamental Analysis - 30 January 2008

Fundamental Analysis

Wednesday, January 30th, 2008 (8:15 a.m. New York Time) USA
First, we will have U.S. ADP Employment Change. I usually say trade it with 75K or even 100K trigger. However, I don't recommend to put any trade on this report unless you know what you are doing. All because of the U.S. Interest Rate statement that is coming out at 2:15 p.m. so it is hard to judge how the market will react on the ADP indicator right before the interest statement.

Wednesday, January 30th, 2008 (8:30 a.m. New York Time) USA
Then at 8:30 we will have the GDP Annualized q/q which is much more powerful that the ADP. It is expected to come out at 1.2% for the 4th quarter. I would trade this with 0.5% deviation. Keep in mind that even with 0.5 deviation (which is significant) sometimes it hits only 20 to 30 pips target on the EUR/USD or USD/CHF. This is also a situation where you may want to stay out. I personally will be trading it put I will also put less money than usually on this trade. If it coms out at 1.7% or better, I would look to buy the USD/JPY. If it comes out at 0.7% or lower, I would sell USD/JPY, looking for about 30 pips price action. It may make more pips but I would just be careful here. Why? The interest rate decision at 2:15 p.m....

Wednesday, January 30th, 2008 (2:15 p.m. New York Time) USA
Then at 2:15 p.m. we will have U.S. Interest Rate Statement coming out. Currently it is at 3.50%, and it is expected they will cut it off down to 3.00%. Based on my sources, 75 to 80% chance they will cut by 0.50%, and about 20 to 25% chance they will cut only by 0.25%. Keep in mind that a week ago on Tuesday they lowered the rates by 0.75% from 4.25% to 3.50%. That means that in a matter of a few days they would cut the rates by as much as 1.25% so there is a lot of worries and no one wants to put any bigger bet on one or another direction. Here is how I would trade it: if they cut by 0.75% from 3.50% to 2.75%, that would be a very weak signal for the U.S. dollar so you may want to sell USD/CHF or buy GBP/USD or buy AUD/USD or buy EUR/USD, looking for a ton of pips such as 60 or 70 pips, potentially more. This is, however, highly unlikely. Also, if they keep the rates unchanged at 3.50%, it is going to be very good for the U.S. dollar, and I would stay away from the USD/JPY and I would focus on GBP/USD, AUD/USD or EUR/USD to sell them. This also would give a lot of pips. If they cut only by 0.25%, that would be a surprise because the market expects a cut by 0.50, so it also would be good for the U.S. dollar and disappointing for the equity market, and you would have a good selling opportunity on EUR/USD, GBP/USD or AUD/USD, looking for about 40 to 50 pips. If they cut by 0.50% that would be as expected but it would bring some relief to the market so I think it could be a buying opportunity on GBP/USD, EUR/USD or AUD/USD even if it is as expected. Trade less money on as expected signal but still you can give a try; however, do not rush into the trade.

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Forex Fundamental Analysis - 29 January 2008

Fundamental Analysis

Tuesday, January 29th, 2008 (8:30 a.m. New York Time) USA
At 8:30 a.m. we are going to have U.S. Durable Good X Transportation (Core) m/m. It is expected to come out at 0.0% or 0.1% according to some other sources. Based on the current situation, I recommend trading it with 1.5 to 2.5 trigger, and I would trade EUR/USD this time. Well, let's say if it comes out at 2% or higher, it would be positive for the U.S. dollar, and I would sell EUR/USD looking for 30 to 40 pips price action in the first hour of the report. If it comes out low, at -2% or even more negative, I would then buy EUR/USD and look for 30 to 40 pips price action in the first hour. This report is "hit or miss" type. If it comes out against a strong trend, then I would not recommend taking the trade on given pair and I would look for an alternative pair such as USD/JPY or USD/CHF (don't forget to flip triggers for USD based pairs as the trigger is provided for EUR/USD) or GBP/USD. Just try to pick a pair that will let you go with the trend if the trigger is hit.

Tuesday, January 29th, 2008 (9:00 a.m. New York Time) USA
At 9:00 a.m we will have U.S. National HPI Composite-20 y/y coming out. It is expected to come out at -7.0% or even -7.1%. If it comes out at -7.3% or more negative, it is going to be bad enough to create some weakness, and I would sell the USD/JPY or buy EUR/USD, whatever is more appropriate at the time the news is given. On either pair I would expect 25 to 35 pips price action. If it comes out -6.7% or less negative, that would be good for the dollar so I would buy USD/JPY or sell EUR/USD, looking for 25 to 35 pips of price action as well.

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Forex Fundamental Analysis - 28 January 2008

Fundamental Analysis

Monday, January 28th, 2008 (10:00 a.m. New York Time) USA
At 10:00 a.m we will have U.S. New Home Sales coming out. It is expected to come out at 645K. Last month it came out at 647 K so it was a very shocking negative number. This time I would trade it on the USD/JPY. If it comes out at 700 K or higher, then I think it would constitute a good buy signal on the USD/JPY. If it comes out at 550 K or lower so a very large trigger on a negative side, then I think it would be enough to put a sell trade on USD/JPY and look for 30 to 40 pips of movement, if not more. The reason why I set up much bigger trigger on the lower side is because the negative news on housing is largely priced in so it is not shocking to the market any more. Be very careful on this one, you really need to have a shocking number if you want to sell USD/JPY.

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Forex Fundamental Analysis - 24 January 2008

Fundamental Analysis

Thursday, January 24th, 2008 (4:00 a.m. New York Time) GERMANY, EURO ZONE
At 4:00 a.m. we will have German IFO. I would not trade this, leave it alone.

Thursday, January 24th, 2008 (8:30 a.m. New York Time) USA
Then at 8:30 a.m. we will have the U.S. Unemployment Claims coming out, and it is one of the rising stars now. It is expected to come out at 320 K. It is the best to trade 20 K trigger so if it comes out at 340 K or higher, it is more unemployment so it is bad for the U.S. dollar, and I would sell USD/JPY. If it comes out 300 K or lower, that's less unemployment and good for the dollar, and I would buy the USD/JPY. If the trigger is hit, I would expect 30 to 35 pips or more of the price action.

Thursday, January 24th, 2008 (10:00 a.m. New York Time) USA
At 10 a.m. we will have U.S. Existing Home Sales coming out of the U.S. If we get a shockingly low number, it will not really move the market like it used to. What people are looking for is if there is any sign of recovery here. You should just trade the upside trigger; the downside trigger may or may not work. Last week the housing market indicator had a huge sell signal and it completely went the other way. It is expected to come out at 4.95 M. I would trade a 0.2 trigger so if it comes out at 5.15 M or more positive, that should be good for the U.S. dollar and the equity, and I would buy USD/JPY.

Thursday, January 24th, 2008 (6:30 p.m. New York Time) JAPAN
Then at 6:30 p.m. we will have Tokyo CPI X Fresh Food y/y. It is expected to come out at 0.3, and last time it came out 0.3 as well. I would use 0.2 deviation on this. If it comes out at 0.5 or higher, I would sell USD/JPY (40 pips price action) or EUR/JPY or GBP/JPY. If it comes out at 0.1 or lower, I would buy USD/JPY or EUR/JPY or GBP/JPY and expect 40 pips price action on USD/JPY.

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Forex Fundamental Analysis - 23 January 2008

Fundamental Analysis

Wednesday, January 23rd, 2008 (4:30 a.m. New York Time) UK
At 4:30 a.m. we are going to have UK GDP as well as BOE Minutes. Because M. King spoke today at 3.10 and said enough about inflation like it may be over 3%, a lot of people think they will not do an emergency cut, implying they are going to cut but not an emergency cut. This makes the Minutes a little less important than usually it is. However, if they vote 9-0 to hold the rates steady on January 10, that would be bullish for the British pound, and if they voted 5-4, then it would be weakening for the pound. We will also have the GDP indicator at the same time. Last time the BOE Minutes dominated; this time, I think, the GDP may be more important. However, you have to look at the whole picture and try to get a good sense what is going on. Even 0.1 trigger is significant on the advanced GDP out of the UK but to be safe due to BOE Minutes coming out at the same time, I would trade 0.2 trigger. If the GDP q/q comes out at 0.7% or higher, we should see GBP/USD going up by 40 to 50 pips (assuming there is no conflict with the BOE Minutes), and it if comes out at 0.3% or lower, that would be weakening the GBP/USD, and it should drop by 40 to 50 pips in the first hour (if there is no conflict).

Wednesday, January 23rd, 2008 (3:00 p.m. New York Time) NEW ZEALAND
At 3:00 p.m. we are going to have New Zealand Interest Rate statement. They are expected to keep the rates steady at 8.25%. If they cut the rates, you can sell NZD/USD and look for 50 to 70 pips price action. If the price drops a lot before the report, you may consider buying NZD/USD if there is no cut, and I would take quick 20 pips only. If they hike the rates, then of course you can buy NZD/USD, and expect 50 to 70 pips price action. The real potential is if they either hike or cut, no change can be tradable only if there is a big down move right before the report.

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