Friday, June 15th, 2007

Let's now talk about what's going on tomorrow, Friday.

1. Friday, June 15th, 2007 (8:30 am New York Time) USA
We have only one major report that's coming up tomorrow. We have CPI
coming out of the United States at 8:30 a.m. New York time. In
addition to that, we have consumer price index core number, then we
also have the Empire State Business Conditions Index, we have current
account and few other year-over-year numbers on CPI. The most
important of all of these indicators will be the consumer price index
core m/m. It's expected to come out at 0.2%. If it comes out at 0.4%
or higher, I think GBP/USD may possibly go down by 50 pips or more in
the first hour of the report. If it comes out at 0% or negative, GBP/
USD may possibly go up by 50 pips or more in the first hour of the
report. The reason being the higher the number on the CPI, the better
is going to be for the US dollar. Now, if the CPI doesn't come out
deviating the 0.2% but it only comes out deviating but 0.1% from
expectations, meaning instead of 0.2% it comes out at 0.3%, I think
we are going to see a move; it may be a smaller one: only maybe 30 or
40 pips, and it will largely depend on the strong price levels before
the report. As you can see right now, the GBP/USD is at 1.9700 level.
If it stays at that level or it's a little bit lower of that level, I
am not sure whether 9670 or 9680 can be broken decisively if the CPI
comes of slightly higher. On the other hand, if the CPI comes out of
0.1% and the price is still around similar levels right now, we may
see GBP/USD go up by maybe as much as 40 or 50 pips. Again, the price
is not as important, and it's very difficult to predict where the
price will be before the report but the point is if there is a
deviation from the expectations of 0.2% on the core number, we are
going to see some volatility in the dollar crosses. So, the higher
the number, the more positive for the dollar, bearish for GBP/USD;
the lower the number the more negative for US dollar, bullish for GBP/
USD. There's definitely some account has to be taken; current-account
imparts the business conditions has to be taken into consideration
but not too seriously. CPI core is what is going to drive the move,
in my opinion.

2. Friday, June 15th, 2007 (9:00 am New York Time) USA
Then, at 9 a.m. NY time, we have treasury international capital long-
term investments coming out, also known as TIC. It's expected to come
out at approximately 72 billion and this report has been a very
unreliable report lately. I personally will not be trading it. I will
be watching it and there may be some opportunities depending on what
the CPI will do. So be aware of it. You may see a price move by 15 or
20 pips either direction, very fast back-and-forth, but I do not
recommend trading that unless you know what you're doing.

3. Friday, June 15th, 2007 (9:15 am New York Time) USA
Then at 9:15 a.m. New York time we have industrial production coming
out of the United States. Industrial production measures
manufacturing activity and mining activity in the United States. This
is another report that's usually a bad mover; very inconsistent
report. It's expected to come out around 0.1%. I personally will be
watching this report but I will not be too quick to jump on it. The
way I trade this report will largely depend on what the CPI will do
but generally speaking the higher industrial production, the better
is for the dollar (GBP/USD down); the worst industrial production,
the worse it is for the dollar, meaning GBP/USD up. There may be a
move of 20 or 30 pips if Industrial production comes out deviating
but 0.5% either direction but as I said, this is going to be a long
shot.

4. Friday, June 15th, 2007 (10:00 am New York Time) USA
Then, at 10 a.m. NY time, we have University of Michigan consumer
sentiment coming out. I will not be trading this report for sure.
Reason being, this is a private report and many times it has low
integrity. Sometimes it leaks and you can see the move happening
before it's actually released, and when it actually comes out there
may not be a trading opportunity. Also, the market doesn't care much
about that report. So just be aware of some small price action, maybe
10, 15 or 20 pips at 10 a.m. and I personally will be skipping that
report.

Okay, that's all for tomorrow. I hope you will have a wonderful
weekend and I hope you will make some money tomorrow so we could
spend some during the weekend, and I'll talk to you again on Sunday
night.