Newsletter 12/10/2007

Trading Discussion News and Economy
1

ASIAN SESSION

A) CALENDAR

-11/10/2007
-GMT 23:50 JPN CGPI (m/m), (Sep) EST 0.1% PREVIOUS 0.0%
-GMT 23:50 JPN CGPI (y/y), (Sep) EST 1.9% PREVIOUS 1.9%
Definition
The domestic corporate goods price index is classified into five groups based on the Japan Standard Industrial Classification and the Annual Census of Manufacturers with reference to the Standard Commodity Classification for Japan.
The indices measure monthly average changes of prices received by producers of commodities. The indices are referred to as domestic corporate goods price indexes by source. They cover products of manufacturing industries for domestic sale (imported goods are excluded). Prices are those of inter-enterprise transactions at the primary wholesalers stage or manufacturers’ shipment prices in the case of commodities directly sold to users. They are net of discounts but include a consumption tax from April 1989.

-GMT 23:50 JPN Import prices (m/m), (Sep) EST -0.3% PREVIOUS -2.3%
-GMT 23:50 JPN Import prices (y/y), (Sep) EST 2.8% PREVIOUS 4.2%
-GMT 23:50 JPN Export prices (m/m), (Sep) EST -0.9% PREVIOUS -3.2%
-GMT 23:50 JPN Export prices (y/y), (Sep) EST -0.6% PREVIOUS 1.2%
Definition
The export and import price indexes measure the transaction prices of goods and services exported from or imported into Japan.

B) SUPPORT-RESISTANCE
EURO/USD USD/JPY GBP/USD
R3 1.4280 118.10 2.0390
R2 1.4240 117.90 2.0370
R1 1.4215 117.75 2.0350
S1 1.4165 117.00 2.0310
S2 1.4140 116.80 2.0275
S3 1.4105 116.65 2.0255

C) WATCH
-Interest Rates

  • (11/10/2007) GMT 23:50 JPN CGPI

D) TRADING TIPS
While the ascending triangle most often appears in an uptrend and is considered a continuation pattern, it sometimes appears as a bottoming pattern. It is not unusual toward the end of a downtrend to see an ascending triangle develop. However, even in this situation, the interpretation of the pattern is bullish. The breaking of the upper line signals completion of the base amd is considered a
bullish signal. Both the ascending and descending triangle are sometimes also referred to as right angle triangles.

2

EUROPEAN SESSION

A) CALENDAR

-GMT 09:00 EU Industrial Production (m/m), (Aug) EST 0.3% PREVIOUS 0.6%
-GMT 09:00 EU Industrial Production (y/y), (Aug) EST 2.1% PREVIOUS 3.7%
Definition
Industrial production consists of the total output of a nation�s plants, utilities, and mines. From a fundamental point of view, it is an important economic indicator that reflects the strength of the economy, and by extrapolation, the strength of a specific currency.

B) SUPPORT-RESISTANCE
EURO/USD USD/JPY GBP/USD
R3 1.4240 118.10 2.0390
R2 1.4215 117.90 2.0370
R1 1.4190 117.75 2.0350
S1 1.4165 117.00 2.0250
S2 1.4140 116.80 2.0230
S3 1.4105 116.65 2.0190

C) WATCH
-Interest Rates
-GMT 09:00 EU Industrial Production

D) TRADING TIPS
While the ascending triangle most often appears in an uptrend and is considered a continuation pattern, it sometimes appears as a bottoming pattern. It is not unusual toward the end of a downtrend to see an ascending triangle develop. However, even in this situation, the interpretation of the pattern is bullish. The breaking of the upper line signals completion of the base amd is considered a
bullish signal. Both the ascending and descending triangle are sometimes also referred to as right angle triangles.

3

US SESSION

A) CALENDAR

-GMT 12:30 USA PPI (m/m), (Sep) EST 0.4% PREVIOUS -1.4%
-GMT 12:30 USA PPI (y/y), (Sep) EST 3.7% PREVIOUS 2.2%
Definition
The PPI gauges the average changes in prices received by domestic producers for their output at all stages of processing. The PPI data is compiled from most sectors of the economy, such as manufacturing, mining and agriculture.

-GMT 12:30 USA PPI Core (m/m), (Sep) EST 0.2% PREVIOUS 0.2%
-GMT 12:30 USA PPI Core (y/y), (Sep) EST 2.2% PREVIOUS 2.2%
Definition
This indicator is a derivative of the PPI that excludes the volatile Food and Energy items.

-GMT 12:30 USA Retail Sales (m/m), (Sep) EST 0.2% PREVIOUS 0.3%
Definition
The retail sales report is a measure of the total receipts of retail stores from samples representing all sizes and kinds of business in retail trade throughout the nation. It is the most timely indicator of broad consumer spending patterns and is adjusted for normal seasonal variation, holidays, and trading-day differences. Retail sales include durable and nondurable merchandise sold, and services and excise taxes incidental to the sale of merchandise. Excluded are sales taxes collected directly from the
customer. It also excludes spending for services, a large component of consumer expenditures. Retail sales is a the first picture of consumer spending for a given month. Retail sales are often viewed ex-autos, as auto sales can move sharply from month-to-month. Also, gas and food component changes are often a result of price changes rather than shifting consumer demand. Retail sales can be quite volatile and the advance reports are subject to large revisions.

-GMT 12:30 USA ex Autos (m/m), (Sep) EST 0.3% PREVIOUS -0.4%
Definition
This indicator is a derivative of Retail Sales that excludes the volatile Automobile Sales component.

-GMT 13:10 USA Bernanke Gives Opening Remarks at Dallas Fed Conference

-GMT 13:45 USA Michigan Sentiment (P Oct) EST 84.0 PREVIOUS 83.4
Definition
This survey measures the attitudes and expectations concerning both present and future economic conditions of 500 consumers. Just like Consumer Confidence, the level of consumer sentiment is directly related to the strength of consumer spending. It is almost identical, with two subindexes - expectations and current conditions, but has two monthly releases, a preliminary and final reading. The consumer expectations portion of the Michigan survey is a component of the leading economic indicators index. Consumer spending accounts for two-thirds of the economy, so the markets follow any indicator relating to consumer behavior and attitudes. The more confident consumers are about the economy and their own personal finances, the more likely they are to spend. It is interesting to note that changes in consumer sentiment and retail sales don’t move in tandem.

-GMT 14:00 USA Business Inventories (m/m), (Aug) EST 0.2% PREVIOUS 0.5%
Definition
Business inventories consist of items produced and held for future sale.

B) SUPPORT-RESISTANCE
EURO/USD USD/JPY GBP/USD
R3 1.4280 118.10 2.0390
R2 1.4240 117.90 2.0370
R1 1.4215 117.75 2.0350
S1 1.4165 117.00 2.0245
S2 1.4140 116.80 2.0230
S3 1.4105 116.65 2.0190

C) WATCH
-Interest Rates
-GMT 12:30 USA PPI
-GMT 12:30 USA PPI-Core
-GMT 12:30 USA Retail Sales
-GMT 12:30 USA Retail Sales ex Autos
-GMT 13:10 USA Bernanke Gives Opening Remarks at Dallas Fed Conference

D) TRADING TIPS
While the ascending triangle most often appears in an uptrend and is considered a continuation pattern, it sometimes appears as a bottoming pattern. It is not unusual toward the end of a downtrend to see an ascending triangle develop. However, even in this situation, the interpretation of the pattern is bullish. The breaking of the upper line signals completion of the base amd is considered a
bullish signal. Both the ascending and descending triangle are sometimes also referred to as right angle triangles.