Top 5 11.15.13

TOP 5 HOT IDEAS

DATE: Friday Nov 15, 2013

Guidelines for Top 5 Trading:
Proactive –
Enter trade 20 minutes before data, 25 pip stop, 25 pip first target
Reactive – Enter trade 5 minutes after data release, 20 pip stop, 15 pip target

1. USD/SGD – Singapore Retail Sales



FUNDAMENTALS
Singapore Retail Sales expected @ 1% (0 AM ET / 5 GMT)
Our View – Neutral
Reason – Neutral
If retail sales stagnates or declines = Buy USD/SGD
If retail sales rises by 3.5% or more = Sell USD/SGD

Singapore’s retail sales report is scheduled for release tomorrow but the data is difficult to handicap and therefore best traded reactively. If retail sales stagnate or decline, USD/SGD can be bought for a move higher. If spending grows by 3.5% or more, representing acceleration in economic activity USD/SGD can be sold. REACTIVE TRADE

TECHNICALS

1.2500 double top
1.2400 support
Retrace run out of momentum

The retrace rally in USD/SGD has run out of momentum at the 1.2500 level forming a double top and the pair now sees support 1.2400 as it looks ready to move lower again.

2. USD/TRL – Turkish Unemployment

FUNDAMENTALS
Unemployment Rate expected @ 9.5% (3 AM ET / 8 GMT)
Our View – Neutral
Reason – Neutral
If the unemployment rate rises to 9.6% or higher = Buy USD/TRL
If the unemployment rate drops to 9.2% or lower = Sell USD/TRL

Turkey’s unemployment rate is scheduled for release on Friday. Unfortunately the data is difficult to handicap and not incredibly market moving unless there is a big surprise. Therefore we feel that it is best traded reactively. If the unemployment rate rises to 9.6% or higher, we expect USD/TRL to rise. If the unemployment rate drops to 9.2% or lower, we expect USD/TRL to fall. REACTIVE TRADE

TECHNICALS

2.0500 caps the rally
Lower top in place
2.0200 near term support

The rally in USD/TRY failed at a lower 2.0500 high suggesting that the pair is in a bearish bias and could drift lower towards the 2.0200.

3. EUR/USD – Eurozone CPI

FUNDAMENTALS
EZ CPI expected @ -0.1% (5 AM ET / 10 GMT)
Our View – Neutral
Reason – These are final numbers so no revisions expected
If CPI growth exceeds 0.1% = Buy EUR/USD
If CPI growth drops by -0.2% or more = Sell EUR/USD

With the Eurozone flash PMI report already released, tomorrow’s final CPI figures can only be traded reactively. If CPI rises by 0.1% or more, showing that disinflation is less of a problem, the EUR/USD can be bought for a move higher. If CPI growth drops by -0.2% or more, showing even weaker price pressures, the EUR/USD can be sold. REACTIVE TRADE

TECHNICALS

3500 caps the move
3400 still support
3550 stiffer resistance

EUR/USD rally remains in place but 3500 caps the move so far and the pair needs to clear that level in order to make a run at the bigger resistance t 3550 level.

4. USD/JPY – Empire State Manufacturing Survey

FUNDAMENTALS
Empire State Manufacturing Survey expected @ 5 (8:30 AM ET / 13:30 GMT)
Our View – Neutral
Reason – Neutral
If Empire State index exceeds 8 = Buy USD/JPY
If Empire State index is less than 1 = Sell USD/JPY

As one of the first manufacturing reports out of the U.S., the Empire State survey is difficult to handicap and therefore best traded reactively. If the Empire State manufacturing index exceeds 5, USD/JPY can be bought for a move higher. If the index drops to 1 or lower, USD/JPY can be sold. REACTIVE TRADE

TECHNICALS

100.00 taken out
Little follow through
99.00 still support

USD/JPY has taken out the 100.00 level but the pair saw little follow through on the move and could stall out unless it can clear the 100.50 level. Meanwhile 99.00 acts as near term support.

5. USD/CAD – Canadian Existing Home Sales

FUNDAMENTALS
Existing Home Sales expected @ (9 AM ET / 14 GMT)
Our View – Neutral
Reason – Neutral
If CAD Existing home Sales fall by -1% or more = Buy USD/CAD
If CAD Existing home Sales rise by 1.5% or more = Sell USD/CAD

Canadian existing home sales is a difficult piece of data to handicap and also not incredibly market moving for the CAD unless there is a big surprise. Therefore the data can only be trade reactively. If existing home sales fall by -1% or more, we expect USD/CAD to rise. If existing home sales rise by 1.5% or more, we expect USD/CAD to fall. REACTIVE TRADE

TECHNICALS

1.0500 fails again
1.0400 still support
Range remains in place.

USD/CAD remains rangebound failing at 1.0500 once again as it is proving to be very stiff resistance and the pair looks to be headed for a retest of the 1.0400 support.

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