Forex Trading Signal 05/05/08

5.5.08    

Forex Trading Signal 05/05/08 - Today, 04:05 AM

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Hi my dear Trader

Let's review what happened last Friday.

We had only one report coming out that was worthy watching and possibly trading.

The U.S. Non-Farm Payroll came out better than expected by +55K but did not hit my trigger. The actual number was -20K and I was going to buy USD/JPY if it came out at least 0K or better (positive). Surely +55K deviation was a positive surprise but what really gave a lot of fuel was the unemployment rate that fell down by 0.2% from 5.2% to 5.0%. +55K deviation on Employment Change combined with -0.2% deviation on Unemployment Rate moved USD/JPY greatly. This time both reports complemented each other but imagine what would happen if they were conflicting. Anyway, based on my signal it was a no trade. For more details, please watch the video.

Let's talk about Monday.

On Monday we are going to have only one report that is worthy watching and possibly trading.

1. Monday, May 05th, 2008 (10:00 a.m. New York Time) USA
At 10:00 a.m. we are going to have U.S. ISM Non-Manufacturing. It is expected to come out at 49.1, and the expectation is coming down from 49.5. This indicator is getting hotter and hotter since they changed the method how they calculate the number so now this indicator more accurately predicts the future GDP. Therefore, it is a leading indicator for GDP and therefore it predicts what the Fed is going to do. I am going to use 1.0 trigger here. Last month 0.8 deviation moved USD/JPY by 44 pips, and in the previous month we had 67 pips move on 2.0 deviation. I believe we can get 40 to 50 pips move on 1.0 deviation on USD/JPY. If it comes out at 50 or higher, it would be a buy signal on USD/JPY, and I would look for 40 to 50 pips move in the first hour of the report. If it comes out at 48.1 or lower, I would sell USD/JPY and look for 40 to 50 pips as well.

That's all for Monday. Tomorrow we are going to send our signals quite early so you can prepare for the Australian Interest Rate.

Thank you and good luck with your trades.

To Our Success!