Jul 312012

CL 09 12 (1 Min) 07.31.12

7/31/2012 Monthly CB Consumer Confidence (0400 HI time / 1000 EDT)
Forecast: 61.5
Actual: 65.9
Previous revision: +0.7 to 62.7
Started @ 89.55
1st Peak @ 89.65 – 0402 (2 min)
19 ticks

Reversal to 88.40 – 0408 (8 min)
125 ticks

Notes: Report exceeded the forecast with a small upward revision to the previous report. This caused a small long spike that had to fight through the 50 SMA near the origin for only 10 ticks, then surrendered and fell precipitously for 125 ticks in the next 7 min crossing the S1 and S2 Pivots, bottoming out at 88.40. The market was in a down trend prior to the report, but had been able to fend off the bears for the last hour as the traders waited on the economic news. Then the CB report came in better than expected, but not enough to bring the bulls back. This resulted in the small spike, then the downtrend resumed again with strong conviction. This is a case where you have to be careful and close out with a small profit or loss as the JOBB fills long, but do not let the market hit your stop loss as you rely on hope for the long move to reengage.