Forex Trading Signals by Magister Pips, 2012/08/01
1000 US ISM Manufacturing (50.2 expected, 49.7 prior, 48.5 to 52.0 range)
Last month even the USA printed below 50, it appears the rest of the world's PMI figures
are being dragged down to where Europes have been for awhile now. Coming in at 49.7 below
the 52.0 expected this was very bearish for sentiment. USDJPY spike down 25 pips immediately,
but with very little retracement continued to sell off for the next hour to achieve a move of
45 pips, when it started a long slow bounce back up of 20 pips over hours and hours. CADJPY
also dropped off, but with more steep exaggerated price action, 35 pip spike but continued
over the next 35-45 minutes to sell off for a total of 65 pips, where it bounced many times,
like 4 times bouncing off 77.80s before beginning to rally back up half the move beginning
1.5 hours after the release. US data has been good to trade on stock indices and the EMini
S&P 500 8-9 handles over 8 minutes, most of that occuring in the initial 2 minutes after the
data hit the wires. It then chopped in a tricky sloppy way for a couple of hours before
like the CADJPY beginning to mount a rally 1.5 hours after the release, in this case, it
managed to fully trade back up to the pre-release area withing 6-8 hours. Obviously regardless
some went for the fast money moves on the data if they could penetrate the bots order flooding
the colocation exchange hub and jamming out the retail wire order inflow, but others saw it
as a chance to buy the dip as it is just another dull statistic at the end of the day and
actually there is plenty of cool stuff humans are doing which is progress, I just suppose
some might not understand how to quantify it using dated economic models. So decent moves on
a -2.3 deviation, normally we look for triggers of 2.0 or 2.5. For awhile earlier in the year
with consistent prints above 50 there was a general positive sentiment running and this data
was not causing such good moves but now as the figure pulls back off those highs it becomes
more noticed, so +/-2.0 should be good. Actually it is more psychological than anything, if
we see good prints back above the expansion/contraction line at 50 it will be bullish or else
if there is further deterioration of this figure below 50 then that will be bearish.
if 52.2 or higher then buy EMini, DAX, CADJPY or USDJPY
if 48.2 or lower then sell EMini, DAX, CADJPY or USDJPY
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