Forex Trading Strategy For U.S. Existing Home Sales 06/22/10

The plan for Existing Home Sales release from U.S. will be the typical retracement trading method, where we’ll wait for the release and then wait for a decent retracement before getting into a trade.  Here is the forecast for this release:

10:00am NY Time US Existing Home Sales    Forecast 6.17M     Previous 5.77M
ACTION: USD/JPY          BUY 6.60M            SELL 5.80M

Because the Housing sector is one of the most important news events out of the US, this release will certainly cause some volatility in the market, especially if our tradable figures (+/- 400K) were hit. With the focus of the nation, and of the world, on the possible recovery of U.S. housing sector, this release may bring about a strong sentiment of risk appetite if our BUY trigger is hit…

Furthermore, with this release scheduled at 10:00am US Time, it is the last high impact news for the NY session, we could see some exaggerated market movements as traders may just wait for this release to be out of the way before committing to a position.

It is also important to consider that the New Home Buyer’s credit has ended… This number may very well be a huge disappointment, similar to the building permits release last week, which came out at 60K less than expectation… 

As usual, our deviation is the usual 400K, therefore on a release of 6.60M or better, we’ll be looking to BUY USD; on a release of 5.8M or worse, we’ll be looking to SELL USD… 

Definition:

“Measures the annualized number of existing residential buildings that were sold during the previous month. A rising trend has a positive effect on the nation’s currency because large purchases tend to be made by consumers that are optimistic and confident in their financial position. The sale of a home also triggers commissions for real estate agents, and often home owners will purchase goods such as appliances and furniture shortly after purchasing a home. Traders watch this report closely as it’s the month’s first demand-side housing indicator to be released.”

Related posts:

1. Forex Strategy For US Existing Home Sales 07/20/11
2. Forex News Trading US Existing Home Sales 06/21/11
3. Forex Analysis For US Existing Home Sales 09/21/11
4. Forex News Trading US New Home Sales 02/24/11
5. Forex Trading News US Existing Home Sales 08/18/11
6. Forex Strategy For US New Home Sales – August 23, 2011
7. Forex News Trading US New Home Sales 01/26/11
8. Forex Trading Plan For US New Home Sales 08/25/10
9. Forex News Trading US New Home Sales m/m 03/23/11
10. US New Home Sales Forex Trading Plan 10/27/10

Tagged as: Consumers, currency, economic recovery, Existing Home Sales, Financial Position, Forex, Forex Housing Data, Forex News, Fundamental Trend, Housing Market, Housing News, Housing Sector, Real Estate Agents, Real Time, Residential Buildings, risk appetite, risk aversion, safe haven, sentiment, U S Treasury