Case Study: Speeches vs. Economic Data

It was expected that Henry Paulson's speaking at Senate would be dollar-supportive even when it is about a rescue plan for the two US home loan lenders, Freddie Mac and Fannie Mea.

Almost at the same time, 8:30 EDT, Fed's Plosser was to give speech on US economy. He said the interest rates should be raised "sooner than later" to fight inflation. It was not surprise knowing that he voted against lowering rates in recent FOMC meetings.

All worked in favor of dollar despite weak economic data from contraction in Richmond Fed Manufacturing Index or falling House Price Index.

30 pip profit from less profitable side of portfolio

I had another position, selling USDJPY at 108.15, which I opened earlier this morning. The technical condition was very great and I was a too conservative when I reduced the size later. However totally 30 pip profit made at 107.85 and as always I closed positions before US data. It was less profitable than having EURUSD which I closed it earlier.

When flexibility matters

I closed my position (buy EURUSD) in 10 pip profit, just before German GfK. As the chart shows even a weaker than expected GfK was unable stop Euro rising. Reducing the size was the best decision but I have not that flexibility. I am going to increase my capital to let me have more effective control over my positions. (the trade plan)

Buying EURUSD; Starting to price FOMC Rate Decision

Upcoming data from US housing market, manufacturing, and consumer confidence are all expected to reinforce concerns and make it easier to expect the Fed to delay raising interest rate.
In about one hour to the market close, technical data suggest that the recent negative impact from German IFO on Euro has started to fade. So I decided to buy EURUSD at 1.5516, and I might increase the size if I find more supportive facts.