Top 5 – 11.26.13


DATE: Tuesday, Nov 26, 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 Industrial Production

Singapore Industrial Production expected @ 1.7% (0 AM ET / 5 GMT)
Our View – Neutral
Reason – Neutral
If IP rises by less than 1% = Buy USD/SGD
If IP rises by more than 4% = Sell USD/SGD

Industrial production numbers from Singapore are scheduled for release tomorrow but the data is difficult to handicap and therefore best traded reactively. If Industrial Production rises by less than 1%, USD/SGD can be bought for a move higher. However if industrial production rises 4% or more, representing acceleration in economic activity USD/SGD can be sold. REACTIVE TRADE


2550 caps
Possible triple top
2450 support

USD/SGD continues to hit resistance at 2250 as it continues to channel in the 2450-2550 zone.

2. USD/JPY – Small Business Confidence

Small Business Confidence @ (12 AM ET / 5 GMT)
Our View – Neutral
Reason – Neutral
If Small business is less than 45 = Buy USD/JPY
If Small business Confidence exceeds 55 = Sell USD/JPY

Japan’s small business confidence survey is not a huge market mover for the Yen unless there is a big surprise. Therefore the data should only be traded reactively. If the country’s small business confidence index drops to 45, we expect USD/JPY to rally. If the small business confidence index exceeds 55, it may drive a sell-off in USD/JPY. REACTIVE TRADE


102.00 resistance holds
101.00 near term support
Break opens run to yearly highs

USD/JPY has run out of steam ahead of the 102.00 level and could now correct towards 101.00. A break above 102.00 opens the run to yearly highs.

3. EUR/USD – U.S. Building Permits

Building Permits expected @ 930K (8:30 AM ET / 13:30 GMT)
Our View – Neutral
Reason – Neutral
If Building Permits rise 900K or less = Buy EUR/USD
If Building Permits rise by 950K or more = Sell EUR/USD

The U.S.’ Building Permits report is not huge market mover for the U.S. dollar unless there is a big surprise. Normally housing starts is released alongside building permits but this month’s report is delayed until December. Therefore if Building Permits rise by 900K or less, we expect the EUR/USD to rally. If Housing Starts rise by 950K or more the EUR/USD could be sold. REACTIVE TRADE


3550 caps
3500 supports
Narrow range persists

EUR/USD remains in a narrow range as 3550 caps the upside but 3500 supports for now. The break of either side could lead to steeper moves.

4. USD/CHF – Consumer Confidence

Consumer Confidence expected @ 72.6 (10 AM ET / 15 GMT)
Our View – Bullish USD
Reason – IBD up Slightly, UMich Down
If the index is 74 or higher = Buy USD/CHF
If the index drops to 70 or lower = Sell USD/CHF

We have good reasons to believe that the U.S. Conference Board consumer confidence improved in the month of November. The University of Michigan consumer sentiment deteriorated this month while the Investors Business Daily report increased.
As such, we feel this data should only be traded reactively. If the index rises to 74 or higher, we expect USD/CHF to rally. If the index drops to 70 or lower, we expect USD/CHF to fall. REACTIVE TRADE


9050 holds
9200 caps
Range in place

USD/CHF remains in range as 9050 holds and 9200 caps and we may remain in low volatility for time being

5. NZD/USd – Trade Balance


New Zealand Trade expected @ -350M (4:45 PM ET / 21:45 GMT)
Our View – Bullish NZD
Reason – Rise in Business PMI Index
If NZ Trade deficit is -150M or smaller = Buy NZD/USD
If NZ Trade Deficit exceeds -500 million or larger = Sell NZD/USD

We have good reasons to believe that New Zealand’s trade surplus will surprise to the upside. The RBNZ is hawkish and the business PMI index increased, signaling stronger manufacturing activity. As such, we feel the data can be traded proactively or reactively. For those who choose to wait, if New Zealand’s trade deficit is -150 million or smaller, the NZD/USD can be bought for an extension higher. If the trade deficit is -500 million or larger, the NZD/USD can be sold. PROACTIVE or REACTIVE TRADETECHNICALS

8125 support
8300 caps
Possible bottom in place

NZD/USD has held its support at 8125 and for now looks to have set a near term bottom but 8300 caps the upside

*Top 5 Archive Members Only Top 5

Leave a Comment

Your email address will not be published. Required fields are marked *