November 3rd signal

On Monday there are two reports that are worthy mentioning.

1. Monday, November 3rd, 2008 (10:00 a.m. New York Time) USA
At 10:00 a.m. we will have U.S. ISM Manufacturing PMI. Because expectations are kind of wide on this report, I would use bigger triggers here. If it comes out at 39.0 or less, I would sell USD/JPY and expect 30 pips move. If it comes out at 43.5 or higher, I would buy USD/JPY and expect 30 pips move as well. This is not a killer report but if it is going to deviate, there might be some room to make a few pips.

2. Monday, November 3rd, 2008 (10:30 p.m. New York Time) AUSTRALIA
Then at 10:30 p.m. we will have Australian Interest rate. It is expected to come out at 5.50%, down from 6.00%. This is very early to say how to trade it because the expectations may change but it seems if it comes out at 5.75% or 6.00%, this would be good for the Australian dollar because they did not cut as much as it was widely expected so it would be buy signal for AUD/USD, and please take your profits rather quickly. I would be careful with +0.25 trigger, however, because it is still a cut on interest rates.. If it comes out at 5.50%, then it is hard to say how the price would react so it is no trade. If it comes out at 5.25% or lower, than it would be bad for the Australian dollar, and I would sell AUD/USD and expect 50 pips move. I would take profits rather quickly, just in case.

That would be all for Monday.