On Friday 08-21-09 at 10:00 AM ET 2 USD reports were released, they were the Existing Home Sales for July and the MoM reports by the National Association of Realtors.
Probably the most important report of the 2 is the “Existing Home Sales for July”.
Along with these two reports, FED Chairman Bernanke was speaking.
As a rule, when the FED Chairman speaks – the currency market pays attention, and traders paid attention this time.
I was set up to trade the currency pair EUR/USD, which I did and monitored 5 other currency pairs – GBP/USD, USD/JPY, USD/CAD, EUR/JPY, and GBP/JPY.
In hindsight, I did not make the right decisions, neglecting to follow my own warnings in the preview post I wrote on Thursday 08-20-09, click here for a review
Here are the stats for USD Existing Home Sales for July and the results:
Previous = 4.89 M
Forecast = 5.03 M
Actual = 5.24M
This “forecast” indicated that there would be an increase in home sales of about 140,000 homes sold over the July sales, the “actual“ came out 350,000 homes sold over last month, and 210,000 more than “forecast“.
The 3 currency pairs involving the USD and not the JPY moved in what I shall call an “unexpected” direction in the first 4 to 8 minutes into the report, and the three currency pairs that did involve the JPY, moved as “expected” right off.
Eventually, all six currency pairs made a good showing for some good “scalping” and “short term” trading.
Let’s take a look at the charts and see how things worked out:
First, my trade of the EUR/USD chart – not a pretty sight.
a one minute EUR/USD chart
#1. This was my first trade, a “sell”, along with a fast “stop out” for a loss of 21.4 PIPS, my broker spread had moved back to normal, and I thought that the market would move in favor of the USD.
#2. It appeared to me that maybe the FED Chairman had said something in his speech that was seen as negative for the US economy, so I tried to enter a “buy trade” – the first arrow, but the market was moving and “slippage” was greater than I thought and my ”buy” order was not executed until over a minute later – 2nd arrow.
#3. I was “stopped out” again for a loss of 21.2 PIPS.
This currency pair moved down about 90 PIPS in 45 minutes, my “short term” trades netted me 15.8 PIPS, my over all loss was 26.8 PIPS – not a good day!
The currency pair did move as “expected”, but not as soon as “expected”.
a one minute GBP/USD chart
The GBP/USD moved up the first 4 minutes about 64 PIPS, not “expected“, then it moved down in the “expected” direction about 125 PIPS in 56 minutes.
a one minute USD/CAD chart
The USD/CAD moved down the first 8 minutes about 63 PIPS, not “expected“, then ranged the next 7 minutes, then moved up in the “expected” direction about 50 PIPS in 42 minutes.
a one minute USD/JPY chart
This USD/JPY currency pair did move in the “expected” direction right from the start, it moved up about 115 PIPS in 52 minutes – wish I had traded this pair – next time?
The two “crosses” were as “expected”.
a one minute EUR/JPY chart
This EUR/JPY currency pair did move in the “expected” direction right from the start, it moved up about 130 PIPS in 18 minutes.
a one minute GBP/JPY chart
This GBP/JPY currency pair did move in the “expected” direction right from the start, it moved up about 168 PIPS in 18 minutes – this would have been the best to trade.
The next scheduled release of this report will be Thursday 09-24-09 at 10:00 AM ET.
I will probably be writing a preview post for this report.
So, stay tuned!
