Trading News Update For Thursday.

Thursday, August 30th, 2007 (2:00 a.m. New York Time) UK
At 2 a.m. New York time we will have UK house price index coming out. It is expected to come out around 0.5%. Usually I don't trade this indicator but I think the timing for this indicator is crucial because the inflation came out very low last week or the week before, and the question is whether it's a legitimate reading or simply a byproduct of a bad weather and other seasonal things. If the housing reads 0.8 or higher, that means the inflation still probably be uncomfortably high, and I think GBP/USD may possibly gain 50 pips or more in the first hour of the report. On the other hand, if the reading is 0.2 or lower, then it would be a second lowest reading in a row after 0.1 last month, and that may mean that the inflation is indeed possibly slowing down because house prices are slowing down so GBP/USD may possibly drop 50 pips or more in the first hour of the report.

2. Thursday, August 30th, 2007 (8:30 a.m. New York Time) USA
Then at 8:30 a.m. New York time we will have U.S. GDP coming out. It's a second reading, basically a revision of the previous reading. It is expected to read at 4.1% versus 3.4%, mostly due to more data that has been gathered about exports. Don't mistake this with the GDP reading that we had last month - this is simply a revision of that reading so it has a lot weaker affect on the market. In my opinion, if the reading comes out at 4.5 or higher, we may possibly see GBP/USD going down by 40 pips or more in the first hour of the report. On the other hand, if the GDP reads at 3.7 or lower, GBP/USD may possibly gain 40 pips or more in the first hour of the report. If you trade this indicator, try to get in within the first 10 pips of the pre-release price. If you cannot get in around that price, don't chase it. Trail your stop-loss very closely because this indicator can turn around and go the opposite direction. Be careful with this one.

3. Thursday, August 30th, 2007 (2:00 a.m. New York Time) JAPAN
Then at 7:30 p.m. New York time we will have Japan CPI coming out. The most important reading will probably be Core Tokyo CPI excluding food. It is expected to read at -0.1%. If it reads -0.3% or more negative, it would surely mean that Japan probably is not going to raise rates for a while, and USD/JPY may possibly gain 50 pips or more in the first hour of the report. On the other hand, if CPI reads at 0.1% or higher, I think USD/JPY may possibly go down by 50 pips or more in the first hour of the report.

4. Thursday, August 30th, 2007 (2:00 a.m. New York Time) AUSTRALIA
Then at 9:30 p.m. New York time we will have Australian retail sales and Australian trade balance coming out. The retail sales is expected to read around 0.5%, and the trade balance is expected to read -1 billion. The retail sales is definitely the more important indicator; however, if the trade balance conflicts or doesn't conflict it would make a big difference how to trade this report. If the retails sales comes out at 0.8% or higher, and the trade balance does not conflict so comes out also better or the same as it was expected, AUD/USD may possibly go up by 30 pips or more in the first hour of the report. I would try to get in within first 10 pips on the retracement of the initial spike. However, if the trade balance conflicts, I would try to get in at the pre-release price because the price may go down very well. Use about 15 pips stop-loss, and maybe 20 pips take-profit. On the other hand, if the Australian retail sales comes out at 0.2% or lower, I think AUD/USD may possibly go down by 30 pips or more in the first hour of the report. Same situation with the trade balance: if the trade balance also comes out worse, I would try to get in within first 10 pips of the pre-release price but if the trade balance comes out conflicting meaning better-than-expected then I would try to get in at the prerelease price, short. Be very careful on this one, do not chase it. If you could not get in within 10 pips, just stay away because usually when price goes like 30 pips then it consolidates, and it is too risky to trade.

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