core PCE for 10/30

I posted a more detailed analysis on my "$ For the Week of 10/30" thread, but since I believe so strongly in this trade, I wanted to make a seperate thread.

My own opinion is that based on the Fed statement last Wed, we're very likely to see a lower the consensus reading here (.1 vs .2). I'll change my opinion on a dime however if a large sell-off is seen in the EURO and/or GBP in the London or early NY sessions tomorrow. To my thinking, all this long money is not going to stay in the market if they're worried about an inflationary reading. In fact, I believe the only way a big sell-off would occur is if a hot rumor starts to circulate among traders. We definately could see some profit taking (maybe down to around 20-40 in the GBP), but if a bottom holds that will also be a great place to get long thru the announcement.

If no profit taking is seen, or if buying continues, that means to me that the long money is absolutely convinced of a $ neg reading. You can't let it get too far ahead, so if buying is seen, you'll have to get in if you want to trade this.

After the announcement, assuming you're profitable, as after the GDP on Friday you'll have to watch this carefully and take profits accordingly; a round of profit taking might be seen. That didn't really happen Friday as cable breifly touched 9000 before settling back inthe 80's. Could happen after this one so watch for it.

A reading of .1 or lower could set up a scenario similar to what we've seen many times. A nice pop up, followed by some profit taking, followed by a re-newed round of buying. The BoE is still tipped to be raising, the Fed isn't and in my mind that signals no better time to buy.

i like this trade even better if the dollar strengthens in london.

I agree to a certain level Merlin, but free-fall down into the 8800's without much re-buying does signal to me that a rumor of an inflationary reading is circulating, especially if it occurred fairly quickly. I don't think I would short the $ from there; I'd have to wait for the actual release and trade accordingly.

The best trade in my opinion is to see some profit taking in cable to around the 8930-50 level over a liesurely period of time, then stay there. That would confirm traders are fairly well convinced of a lower reading and leave plenty of headroom. I definately would ake a long GBP position prior to the release.

If re-buying occurs after profit taking, or if cable stays as is or goes higher, then without question traders are convinced the core PCE will be lower then consensus and maybe even into negative territory. I think they'll still be plenty of headroom left for a nice trade before retracing (profit taking) occurs. I would go long in cable prior to the release if this happens as well.

There's several scenarios possible, but simply put I'm long in the GBP prior to the release as long as a free-fall doesn't occur. If that happens I have to wait for the number, then trade.

Seems like a very hot data to ignore.

How often does this data occur? After every GDP? I'd like to do some historic chart for this one.

http://img6.picsplace.to/img6/22/core_pce.png

Source is here.

Based on those 3 dates, the movement is slow. A simple compare the number and place market order will be sufficient to trade this.

Well there are several factors to consider here as to what kind of trade this could be. First, we have a Fed policy/statement that has been interpeted very $-. I'm also looking to trade a pair (GBP/USD) where you have a rate that's tipped to go up (maybe twice) vs. one the is not for the forseeable future. That should lend some more volitility to this trade.

Overall, the markets are reading this Fed very well-they've gotten used to their language. I think more activity will be seen because it's easier for traders to see where policy is going.

In any event-I want to be in the market whenever possible before an announcement. I think to really trade succsessfully you need to be able to read where the money is and how it's thinking. It's not so much about the actual pips-getting the thinking right is the ultimate goal.

I dont think GBP/USD will strengthen further without a sub 0.2% number on core PCE. Its obvious m/m PCE will be less than consensus and personal spending will be higher. If 0.2% is hit, i think we'll see some profit taking.
On the upside 1.9078 is the target.

hey guys ..

Someone told me now that the CORE number came out 0.1 ( Bloomberg ) .. i'm not sure .. but maybe it's right , the move is VERY SLOW .

you are on the dot about GBPUSD not going up further indeed.

the result was 0.2% at par with concensus. some of the numbers were USD positive and I shorted the pair for 10 pips.

but it all went up again.

at any rate... FF took 30 minutes to reboot?
Merlin, you should seriously fix the site. what is causing the site to crash? and it ALWAYS happen a few seconds after a news!?!?!?!?!

If the cause of the crashes is those calendar refreshers, PLEASE move the calendar to a separate computer and network to prevent this from happening. It is totally deterioratng the whole forum.

i just hope it is not a week of non farm paralysis.

Im surprised not to see more dollar strength with this news anouncement, gbp went back up a bit weird, and I seriosly doubt we ll have Non Farm Paralasis this week with the GBP being where its at

You are right Burgerking. It took me 40 minutes to get this forum.

Merlin

Please do something to get Forum on first click. This is totally deterioratng the whole forum.

The Aug core PCE was revised up-so the sept number does reflect weakness. There is really so much long money in the pound, I would expect some profit taking eventually, but we do have GBP housing prices tom and that's an important number.

Most of the trading in this occurred prior to the report from about 5.00 EST...I took a long position and got lucky...
Still the core PCE did not scare the long money as no big sell off was seen. Probably now is a good time to sit back and get some further readings....

on a tech angle seeing a poss double top at the 9040 level, nothing impressive has happened so far, looks more like stop hunting type action to me.. just plain choppy so far, currently short from 9032 with a stop at 9055..

d TOP on smaller time frame ie 5min 3min...

theres still alot of bullish sentiment and support need to see a clear break lower here... the fundies werent too impressive either..

But momentum on the pound is clearly divering.. making long trades more risky...

Did anyone else hear about the Aug core PCE revission? It does make the Sept number look more $ neg...

Prior PCE Core revised to 0.3% from 0.2%.

It's up, so shouldn't it be $+?