Today's Signal

Let's first review what happened on Friday.

U.S. Retail Sales came out lower and USD/JPY moved down by over 20 pips but then it reversed. One thing for sure, I did say not to trade it on EUR/USD or other pairs, and surely it did not work there. USD/JPY was not the best trade either but at least not as horrible as EUR/USD trade would be.

U.S. Consumer sentiment came out a bit better than expected, not enough to enter a trade.

Let's now talk about Monday.

1. Monday, October 17th, 2008 (8:30 a.m. New York Time) USA
At 8:30 a.m. we will have U.S. Empire Manufacturing coming out. If it comes out at -40 or lower, I would sell USD/JPY and expect 25 pips move. If it comes out at -12 or less negative, I would buy USD/JPY and expect 25 pips move as well. This is not a killer report but it might be an opportunity to make a few pips. Do not overlaverage yourself on this, however.

2. Monday, October 17th, 2008 (9:15 a.m. New York Time) USA
At 9:15 a.m. we will have U.S. Industrial Production. A deviation of 1.0 may work on USD/JPY either at the time of the release or 15 minutes later when the stock market opens but I am not going to trade it.

That's all for Monday.