Trade Team Update

Fundamentally, we had a rather interesting day... today was all about CPI for the U.S. and France.

Not surprisingly, France's CPI ticked down a touch, which falls in line with the ECB's softer inflation tones. But the real story today was the U.S. CPI which also ticked down. This certainly caught me by surprise and I can't honestly see this is at all possible.

Now, I consider myself a halfway intelligent person, so what I'd like the Fed to explain to me is how inflation can be easing when food prices are up anywhere from 15% to 20%, and crude is pushing $130 a barrel, and the price of fuel at the pump is at highs never seen before...

Core CPI exlcudes food and fuel prices, and this came down and was cooler than expected. Fine, whatever. But even the CPI data that includes fuel and food prices was cooler than expected.

To me it's almost shocking to see this blatant data manipulation by the Fed. But not too shocking when you consider the Fed is an illegaly operating organization that is above the rule of constitutional law and is controlled by bankers, liars, and thieves who see fit to price fix markets.

I was expecting the dollar to come under pressure today after that data. Althought there wasn't an instant reaction, I think it's coming to be honest. I think this weak inflation data could put the market back on thinking the Fed's going to cut rates again and we could see the EUR make a move against the USD in the days or weeks to come... stay tuned.

Tomorrow:

Take one look at tomorrow's fundamental calendar and it will make your head spin. It's even too much for me... it's data overload and it's one of those days when I don't even really bother to research it or try to figure out in advance how to trade it. We're talking about 12 straight hours worth of key fundamental data...

But, let's cover a few of the key pieces so you can get your money's worth out of this update.

Out of the Eurozone we have growth and inflation data... growth may come in a touch weak and inflation should stay as is for the most part. I think the only real downside surprise could come in the growth data tomorrow. That being said, I'm not heading into tomorrow over-the-top bearish on the EUR.

Out of the U.S. we have all kinds of crap... production, inflation, foreign investments, housing, jobs, plus Bernanke. I really don't expect any USD upside surprise tomorrow either. Overall, lets just say I'm not going into tomorrow's mega data event over-the-top USD bullish.

I really don't have much else to add about tomorrow. Like I said, we'll be on data-overload and it's not worth the brainpower to even try to make sense of it all ahead of time. But, with proper risk management and depending upon price action and price patterns, tomorrow should be stress-free and fun to watch it all play out before our eyes.

EUR/USD:

Our downside testing and downside momentum has visibly slowed up this week compared to last week. Now this could mean a few things... the market could be taking a breather or we could be building some momentum to test the top of the range again...

I'm leaning towards the potential for some more topside testing... not 1.6000, but at least 1.5600-1.5800 level. I have gone back to buying these dips this week. I've been shorting the tops, as you well know, but I've also been adding select euro longs when we've hit a bottom.

For me, I see a higher potential to return to 1.5600++ than we do to correct below 1.5300. That's just me and just my opinion on what I'm seeing right now. You have to make your own trades and do your own analysis on the market.

Obviously you know what's at stake tomorrow... we could see some serious volatility and price swings, so prepare accordingly and only add new trades with caution and a good gameplan.