Friday, June 29th, 2007

Let's now talk about what is going on tomorrow.

1. Friday, June 29th, 2007 (4:30 am New York time) UK
Tomorrow we are starting a day with UK GDP and current account balance coming out at 4:30 a.m. New York time. The current account is expected to come out at negative -12 billion versus -12.7 billion last month, and the GDP, or Gross Domestic Product, is expected to come out the same at 0.7%, same as it did last month at 0.7%. This GDP is simply a revision of a quarterly number; it's same for the number it was released last month, and deviations of those almost never happen. Most likely this will be a no trade but just in case the GDP comes out at 0.9% or higher GBP/USD may possibly go up by 30 pips or more in the first hour of the report. On the other hand, if the GDP comes out at 0.5% or lower, we possibly see GBP/USD going down by 30 pips or more in the first hour of the report. The current account my also cost some volatility, but the GDP, if deviates, is going to move the market.

SUMMARY:
* Report: UK GDP
* Possible BUY on GBP/USD if a reading comes out at 0.9% or higher
* Possible SELL on GBP/USD if a reading comes out at 0.5% or lower
* Expect 30 pips move or more in the first hour of the report if a trigger is hit

2. Friday, June 29th, 2007 (8:30 am New York time) CANADA
Then at 8.30 New York time we have U.S. Core PCE Price Index, and we have Canadian GDP coming out at the same time. My focus will be on Canadian GDP. It is very interesting what is going on with Canadian dollar right now. It has been strengthening, and the GDP can be very crucial for their next interest rate decision. It is expected the Canadian GDP will come out around 0.2% versus 0.3% previous month. In my opinion, if it comes out at 0.4% or higher, we may possibly see USD/CAD going down; I would, however, focus more on EUR/CAD instead because we do not have any possible conflicts with the U.S. reports that come out at the same time. If the number comes out at 0.4% or higher, we may possibly see EUR/CAD going down by 40 pips or more in the first hour of the report. On the other hand, if the GDP comes out flat at 0%, we may possibly see EUR/CAD going up by 50 pips or more in the first hour of the report.

SUMMARY:
* Report: Canadian GDP
* Possible SELL on EUR/CAD if a reading comes out at 0.4% or higher
* Possible BUY on EUR/CAD if a reading comes out at flat at 0%
* Expect 40 to 50 pips move or more in the first hour of the report if a trigger is hit

3. Friday, June 29th, 2007 (9:42 am New York time) USA
Then at 9:45 a.m. New York time we will have Chicago PMI coming out. It measures manufacturing activity in a very industrialist part of the United States, and it just happens to come out always one day before the ISN manufacturing so it gets a lot of spotlight. Chicago PMI is expected to come out at 58 versus 61.7. This report will actually come out to special subscribers at 9:42 a.m. instead of 9:45 a.m. I do have access to that and I will get the number. Anyway, it is expected to come out at 58, and if it comes out at 62 or higher, it would be higher than the previous month in a large deviation so we may possibly see GBP/USD going down by 30 pips or more in the first hour of the report. If, however, the number comes out at around 54 or lower, I think GBP/USD may possibly go up by 30 pips or more in the first hour of the report.

SUMMARY:
* Report: US Chicago PMI
* Possible SELL on GBP/USD if a reading comes out at 62 or higher
* Possible BUY on GBP/USD if a reading comes out at 54 or lower
* Expect 30 pips move or more in the first hour of the report if a trigger is hit

That's all for tomorrow. I hope you will have a wonderful trading day, and I hope both you and me will make some money tomorrow.