OCTOBER TRADE #5 - BUY EUR/USD

Nov 2, 2009 9:32am (Manila)

Trade got stopped-out at -76 pips/lot for a total of -304 pips.

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Oct 30, 2009 9:23am (Manila)

BUY EUR/USD @ 1.4836 (4 Lots)
Stop - 1.4760
Limit 1 - 1.4866
Limit 2 - 1.4918

German Retails Sales data comes out at 3:00pm today. It is expected to be positive for the Euro. This, combined with the positive US GDP data last night should trigger further risk appetite and drive this pair higher. On the daily charts, there is a bounce which could be the start of the reversal of a trend which saw the dollar hammer the other majors this past week.

Why this might be important: Germany is the biggest economy in the Eurozone. Retail Sales impacts consumer spending which is a big chunk of GDP. The expectation is that higher retail sales will translate to higher GDP number, which will have a domino effect of causing price pressures which would result in higher inflation which will cause the European Central Bank to raise interest rates as part of the inflation-control mandate. Quite a long trail, isn't it?