$ For The week of 10/30-With Trade Ideas
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Thread: $ For The week of 10/30-With Trade Ideas

  1. #1
    Never Marry Your Remarks

    If you look back in the beginning of last week you will notice the market doing some thing called buying the rumor, selling the fact.

    The market anticipated the Fed to hold. No more rumor there. The action occurred around what the Fed would say afterwards, i.e. a hawkish statement. That's the rumor which was bought in to; (GBP shorting). From a near on 10/20 of around 8850, we watched it shorted the way to the 87's all thru London on the 23rd. Once the facts where known, the $ was sold off all the way to 9000.

    All together I thought that the hawkish statement was in the cards. Turned out the announcement was neutral to market certainly interpeted it that way and that's my point: My idea about the announcement was wrong. After that, I changed my opinion and traded accordingly. BTW, I do not deel poor at all; a lot of people had the same opinion of the way the Fed announcement would be regarding the tone.

    With an opinion is not like being married in which you stay with your spouse thru good times and bad, in sickness and in health. You do not do so with transactions and your remarks. With trading, you have to be able to change your thinking 180 degrees based on new fundamentals. You gotta trade whether that fact fits with what you thought or not. Good you're a genious if your view was right. If it was wrong, so what. Recognize that and do what has to be done. I developed an opinion that Friday's numbers could be as it was, according to what the Fed stated on Wed. That's precisely what happened and I was able to have a trade out of that. I'm not bragging, I'm just pointing out that you have to be able to think fast without allowing yout feelings get hurt and change your view.

    How can things look heading into Monday's really importatnt core PCE? Well due to a variables on how it's calculated, core PCE tends to grow slower the core CPI number. Owner's equivilent rent contributes approximately half to core PCE vs core CPI. Medical prices are also figured differently, as gov't progr (where prices are regulated) play a part in core PCE and do not in core CPI.

    Aside from that, we've got the Fed statments to work from. I'm pretty sure that the Fed knew the core PCE last Wed and that what they saw didn't frighten them. According to that, I see the core PCE coming then consensus out, however I'm temporing my view as you'll see below.

    Considering that the BoE is still tipped to boost the rate and the Fed isn't, I'll still concentrate with this pair. Right now, there's a lot of GBP profits on the table, from traders who obtained long from the reduced 8700's and continued to buy following Wed right thru Fri.. When London opens Mon, I would not be surprised to see some profits obtained. No saying as to what amount we can see, but look what happened on Fri in London. Profits were taken down to approximately 8875 from 8910. Further GBP buying occured thru there as traders were convinced that the Fri #'s would be neg. They had been before closing around 8965, and the run-up continued all the way to 9000. There's plenty of profits left on the table for the taking. Here is what to look for:

    If the market is of the brain that the core PCE is going to be neg, we can see profits taken down to approximately 8920-30. The idea is to loe a bottom and see if it holds, although I don't think if that's the believing 8900'll crack. The above will be confirmed, if it does hold. You might wish to consider going long in this point and holding it thru 13.30 GMT once the core PCE is declared. You'll be doing what a lot of professional money is currently performing.

    If no profit taking happens, to my thinking that the market is absolutely convinced that the core PCE is going to be neg, so I would go long here. It hold for a while and ought to move thru 9000.

    If a free-fall happens, all bets are off. They'll be selling cable onto a popular rumor that the core PCE will be inflationary. From what the Fed stated Wed I doubt that's gonna happen, but when it does, you will know what it means.

    That's what I mean by not getting married to an opinion. Yes, I feel that the core PCE is going to be neg, but if the free-fall happens...

  2. #2
    OK, 1 minute of research and I got the family survey info:


    lt;! --StartFragment -

    Technical information: Household info: -LRB-202-RRB- 691-6378 USDL 06-1903 http://www.bls.gov/cps/ Establishment data: 691-6555 Transmission of material in this release http://www.bls.gov/ces/ is embargoed until 8:30 A.M. (EST),Media contact: 691-5902 Friday, November 3, 2006. THE EMPLOYMENT SITUATION: OCTOBER 2006 Employment increased in October, and the unemployment rate declined to4.4 per cent, the Bureau of Labor Statistics of the U.S. Department of Laborreported today. Nonfarm payroll employment grew by 92,000 at October follow-ing earnings of 148,000 in September and 230,000 in August (as revised). InOctober, job growth continued in many businesses, whileemployment declined in construction and manufacturing. Average hourly earn-ings rose by 6 cents over the month. Unemployment (Household Survey Data)

    The number of jobless men (6.7 million) edged down in October, andthe unemployment rate declined to 4.4 percent. A year before, the number ofunemployed men was 7.4 million and the jobless rate was 4.9 percent.

    Unemployment rates for most major worker groups--adult men (3.8 percent),teenagers (15.4 percent), whites (3.9 percent), and blacks (8.6 percent)--showed little or no change over the month. The jobless rates for mature women(3.9 percent) and Hispanics (4.7 percent) dropped in October. The unemploymentrate for Asians was 2.7 percent, not seasonally adjusted. (See tables A-1,A-2, and A-3.) The number of persons unemployed for 27 weeks or longer dropped by 189,000 to 1.1 million in October. This group accounted for 16.0 percent of totalunemployment, down from 18.2 percent in September. (See table A-9.)

    Total Employment and the Labor Force (Household Survey Data) In October, total employment increased by 437,000 to 145.3 million, and also the employment-population ratio increased up to 63.3 percent.

    The civilian workforce,at 152.0 million, was about unchanged in October; the labor force participationrate has held 66.2 percent since June. (See table A-1.) Persons Not in the Labor Force (Household Survey Data) About 1.5 million people (not seasonally adjusted) were marginally attachedto the labor force in October, roughly unchanged from a year before. The 12 months, these in-dividuals wanted and were available for work and had looked for a project sometimein. They weren't counted as unemployed because they hadnot hunted in the 4 weeks preceding the survey. Among the marginallyattached, there were 331,000 discouraged workers in October, down marginally. Workers weren't currently looking for work specifi-cally because they believed no jobs were available for them. Another 1.1 mil-lion marginally attached hadn't searched for work in the 4 weeks preceding the survey for reasons like school attene or household responsibilities. (See table A-13.)



  3. #3
    Quote Originally Posted by ;
    Shorts (BK, summit) took money from the Longs (news, trend).

    Dont worry, we'll give free drinks after.
    Really, I was joking around. Was out on my big trade. Today I am sitting at about 90 pips brief right now...

  4. #4
    That's it Newstrader. Both surveys are published - the household survey is where the unemployment rate stems from. That's why, in theory, a complete rise can be shown by NFP but the unemployment rate may go up.

    It certainly looks like the derivatives auction was nearer to the headline NFP number compared to economic analyst consensus. It had been about 103k when I looked.

  5. #5
    Well it'll be interesting to see how things proceed from here. No one's gonna be talking about a cut out of the Fed, but so far an incr is not in the cards. Still status quo.

    Everyone was stating the pound was just about fully bought into @ 9090 off the certain BoE rate incr next week. It is not. There is their GDP the day and some additional UK data out monday, I think. Let's see how London puts their bets...

  6. #6
    I believe GDP is about the 21st. Industrial Production is monday morning though. Its hard to call at which next. I believe down. At least to the reduced 1.89s

  7. #7
    Quote Originally Posted by ;
    Well it will be interesting to see how things proceed from here. So far an incr is not in the cards , although no one's gon t be speaking about a cut out of the Fed. Still status quo.

    Everybody was stating the pound was just about fully bought into @ 9090 off the particular BoE rate incr next week. It is not. There's their GDP the next day and some further UK information out early monday, I think. Let us see how London places their stakes...
    Amazing thread! Magnificent ideas! I wont exchange a day without seeing this thread keep it up guys!!!

  8. #8
    Hey news!

    You chose more money from everyone else more than I did! Excellent Job!

    I was being conservative with my straddle and made only 25 pips on NFP (but with the biggest lots I ever traded so far excluding demo accounts of course).

    Last month, I opined that the 50K will unquestionably be upgraded/revised upwards since this is afterall POLITICS week. Guess I was right on the money there (but heck I shorted GBPUSD in the incorrect place yesterday so I didn't make much money on such position)...

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