Euro Gains On Weaker Than Expected GDP Growth.

Euro managed to gain further following the second quarter's Gross Domestic Report for the year 2006. US Growth slowed to 2.5% from 5.6% in the first quarter. The consensus was 3%. Before the report, markets were expecting a stronger number, higher than 3% for stronger economy growth. However for the major sign of inflation, core Personal Consumption Expendictures were lower compared to the first quarter but is above the economists' consensus. It was reported 2.5% in the second quarter versus 2% in the first quarter. I managed to take another trade again at 1.2680 Long EUR/USD with maximum leverage. Looks like my margin call weeks earler proved to be a good thing that happened afterall. Since my margin call, I managed to scalped with maximum leverage 1 pair of currency at a time at least 500 pips. From $18 dollars left after my margin call, I now have $50 completed profit and another $13.00 unrealized profit. I wouldn't know what to call myself by I guess I'm a semi day-medium trader. Usually I let these profits run until my stops are triggered.

I realised that recently my post hasn't been anything much as I'm very much occupied by the chores that need to be done on the launching of my new gold business company. Hopefully when everything is well established, I will get back to my normal routine and providing more analysis for those who've been reading my posts.

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Existing Trades
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Long EUR/USD @ 1.2680

As I'm always tired these few days, I'll mostly keep my posts short and merely just for journal charting.

USD gains hoping for Inflationary GDP Numbers.

The US dollar traded significantly lower on the dovish Fed's Beige Book, but despite this there is still mixed feeling in the market as the report showed production activity appeared to be expanding at solid pace and labor markets in general were tight. I still believe that this report is just what Bernanke was looking for to confirm his own dovish view on rates. The report showed many local areas actually with slowing growth and we believe in his mind this will only get worse as we head into the fall and will then in return keep a damping factor on inflation. Also not to forget Bernanke main focus is to fight a slowing economy and not inflation. I still believe that whether we see a 25 bps point hike on August 8th we still believe that the following statement by the Fed chairman will leave the market with a strong sense of them putting rates on hault for now which should send EURUSD well above 1.3000 on a 3-months time.

However, the strong numbers coming out from Orders for U.S.-made durable goods rose more than forecast in June, pointing to momentum in manufacturing that's likely to keep the economy growing even as the housing market sputters. The 3.1 percent jump in orders followed a revised 0.3 percent gain the month before. But the sales of new homes in the US declined in June, the latest sign that the American housing market is cooling. The 3% drop from May was the first monthly fall in sales since February. The mixed data continued to push the dollar further down. But current as from the graph, the greenback managed to gain some ground as much as 70 pips from EUR/USD as it reaches 1.2771 early during the early New York Session. My trade was triggered a stop-loss with a huge profit of 110 pips with maximum leverage. I'll be looking forward to continue selling the dollar expecting the GDP index tomorrow for the second quarter to show negative USD data.

Euro awaits Beige Book from Ben Bernanke.

The IFO survey satisfied neither bulls nor bears in early European trade today as the report printed below the consensus estimate of 106.0 but above the whisper number of 103 registering a reading of 105.6 The latest sentiment gauge of the German business community suggested that the Eurozone recovery continues to maintain pace, but the high cost of energy and the prospect of new value added taxes in the region’s largest economy due to take effect next year are tempering enthusiasm about future growth. After a sharp decline in last week’s ZEW and a material correction yesterday in Belgium’s business indicator which often acts as an accurate proxy for IFO, the market was primed for a downside surprise. So, the data release was somehow interpreted as Euro positive. As the market not showing much reaction to the data, we all know that the whole world is waiting for the Beige Book release in the afternoon, US Time.

I took a new trade again today although I thought I could finally make myself rest for a few days, but proved that I couldn't. I'm too much a forex-holic. New term I would call myself and million other traders that couldn't get their eyes off the world politics and the hourly graphs. I took a trade at 1.2580 and the whole afternoon it's going nowhere. I'm expecting the Beige Book to contain mixed message stating that the world's largest economy is undergoing a transition phase to a slower economy growth. Which then, will be interpreted as a negative dollar as traders will dump the dollar. For the interest rate issue, I'm not too much concerned about it as even the August hike took place at 5.50% it will be short term before a interest rate deductions. So I'm seeing overall negative in dollar. I'll update about the Beige Book on tomorrow's update.

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Existing Trade
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Long EUR/USD @ 1.2580

US Consumer Confidence Higher Than Expected, USD continue the bull run.

German CPI for matched consensus, lower German Import Prices, higher than expected French Business Confidence Indicator, all for the month of July were reported and I should say these data was marked as positive for the Euro currency. However, the market didn't take it as it should be. Instead Euro was having a tough time being bullish and the market is being indecisive 4 hours before the US Consumer Confidence is released. I was stopped on breakeven on my EUR/USD trade earlier during early London session where EUR/USD was showing weakness on declining prices due to market expectations on the US Consumer Confidence. I maintained sidelined for the first time since I started trading to observe what would be wise and unwise to do. However, US Existing Home Sales was down 1.3% to 6.62 million units for the month of June. But Richmond Fed Manufacturing Index was reported much higher than expected of 12 for the month of July versus 4 for the month of June. Add on to the USD positive data is the US Consumer Confidence which is higher than expected of 106.5 in July vs. 105.4 in June. Consensus was 104.4. This came out surprisingly that US consumer confidence is unstirred by the high consumer prices and gasoline prices that is trimming out their savings and extra pocket money that they used to have.

Temporarily for the time being, I will remain sidelined until USD reversed to negative. I missed the ride on the bullish USD due to the Consumer Confidence and I'm not going to risk taking a late ride to it. I could use this time to concentrate on my gold business that I've been planning and working on for weeks now. In near future, I might now have the time to update this blog everyday. But I'll continue to do my best analysis and improve my trading experience.

Bernanke Dovish Statement Fading, Middle East War back in talks...

The markets continues to lack focus and drift, for most of Asia and Europe sessions, showing a lack of conviction in traders' outlook. The impact from the war between Lebanon and Isreal on the world major foreign exchange currencies is once again making greenback acting as a safe haven when Isreali armies moved their forces to the border preparing the invasion and initiated the attack over the weekend. Today's Australian's session has proved to be USD bullish when markets has pushed the EUR/USD, 50 pips down during the Asian session before the Tokyo lunch break. I took profit on my EUR/USD trades with a handsome profit and took a USD/CHF trade with maximum leverage expecting it to increase due to geo-political instabilities particularly the middle east. Commodities such as gold and silver has dropped today which might due to the increasing of the interest rates throughout the world and economic growth slowdown in the US. Gold dropped to as low as $605 per ounce today from $618.

I didn't do much of observing and trading today because I wasn't feeling too well myself and I figured that my condition could not work the best for me in my analysis and critical thinking which I consider the BASIC skills to be successful in trading. I hope I could get better tomorrow and resume my trading as soon as possible.