Over the past two trading days there haven’t been strong fundamental data expected and the market is focused on Friday’s NFP which will ultimately provide the barometer readings on Rate Hike probabilities. Yesterday, we only had the CB consumer Confidence released from the US and it printed out a 101.1 reading, this was buoyed by the positive summer sales and grew by a respectable 3.8% on a year on basis and this also was the fourth consecutive month over which consumer spending was advancing in a positive direction. It’s no doubt that consumer spending is what is going to drive the economy in the third quarter and with the current labor conditions improving, the projection for a bigger acceleration of GDP growth-of upto 3.5%- in the 3rd quarter is a possibility.
Today we watch for Crude Oil inventories and ADP Non Farm employment change at 1430 GMT and 1230 GMT respectively.
To the charts and I’m looking to add to short positions even though there is conflicting trend moves in the 4 HR and Daily charts. If support at 0.722 is broken in the 4 HR chart, then our shorts will continue and our immediate target comes at 0.705. Look for major break always in the daily chart and especially that support trendline, if broken that will be about it, we continue to short and if you are in this trade, we move our positions to break even and ride with the trend, only adding positions on all highs.
We look to initiate our shorts in the 15 min chart and follow it up closely with a 50 min stop loss as follows:
Sell Limit: 0.725-0.726 (representing a sell between yesterday’s highs and the 23.6 Fibonacci level)
Stop Loss: 0.73
TP: 0.71-0.715-this is at your discretion
Otherwise, that’s it for today, have a good trading day