Hi Folks.

Let me officially welcome you to Summer Doldrums trading, at least in terms of news-based trading opportunities.  After closely reviewing this week's economic news offerings, I can pretty much sum up the entire week in one word: Pass.  And you thought last week was miserable.  And it was, overall. But at least we had a couple of numbers that were worth watching.

This week?

Not so much.

So I'm going to save you some time and whip through the week without a lot of comments, aside from the pertinent "this really sucks" observation from time to time.  The good news is this kinda sorta marks the midpoint of summer trading (technically it's next week but since everyone takes off the last 2 weeks of August, we can make a case for this week as being Peak Summer Doldrums) which means we are just a few weeks away from September and the return (hopefully) to normal trading conditions.

Let's hope so, anyway.

Now on with the (abbreviated) show.

SUNDAY:  Between 9 and 9:30 p.m., we have three numbers dropping: 2 out of Australia and 1 from New Zealand. None of the three move price around more than 5-6 points/pips, so Pass on the lot of them.  

MONDAY:  Asian/London Session:  Asian and London session economic news providers certainly do their part this week to contribute to the Summer Doldrums by giving us a pile of worthless numbers to stare at. As I mentioned a few weeks ago lately I've been going back and looking at some of the charts to see if any of these numbers have awakened recently.  Today I'm looking at the EUR PPI and Retail Sales. Both drop at 5:00 a.m. my time and typically come out on different dates each month, so this is a rare occasion we see them paired together. The last 3 numbers for PPI came in at 11, 21, and 8, while Retail Sales brought home 11, 10, and 15 pips over the last 3 releases. One out of 6 broke my 20 Pip minimum line (barely) while the rest stayed nestled comfortably below any price point that looks vaguely interesting. So pass on this not so Dynamic Duo. The rest of the session, morning and evening, are trash.

          USA Session: After taking Mondays off for a few weeks in a row, we finally get a few numbers thrown our way to start the week.  That fake Final Services PMI at 9:45 is on everyone's pay-no-mind list, but the 10:00 a.m. ISM Services PMI is still Red Folder, although for how much longer is anyone's guess.  The last 3 numbers it posted were 29, 15, and 17.  That 29 showed up in April when the number missed to the downside by 8/10ths of a point. But the June number did the exact same thing except it missed to the upside and the market only generated 17 pips. It doesn't seem to matter if this one is paired up with another report (and hopefully a better/stronger one at that!) It still lands below 20 more often than not. But given the barren nature of this week's calendar, this one is probably worth watching. And if you take a trade and it looks like price is stalling out in the mid-teens, don't hesitate to close the trade and bank the pips. Keep in mind our old buddy Stu's maxim: No one ever went broke taking profit. One incident of FedSpeak at 11 can be ignored.

TUESDAY:  Asian/London Session: Another one of those days where we find 18 entries covering morning and evening sessions, but it's all trash, except for the New Zealand Cash Rate (Interest rate) release at 10:00 p.m.  And I say that with tongue firmly in cheek, because while some Interest Rate decisions can really rock the house, the New Zealand version has posted a combined 25 pips over the last 3 months (9, 9, and 7 pips). Just a depressing pile of useless numbers for the entire day.

          USA Session: And it doesn't get any better down here.  We get a pair of ADP Weekly Unemployment numbers because they just couldn't get around to releasing the June 13th version on time. Now we get a glimpse into the market's reasons for absolutely ignoring this one each week.  Pass.  Trade Balance at 8:30 is a Pass, along with that floating RCM/TIPP Economic Optimism report that drops around 10:05 to 10:15 if it drops at all.  Don't pass, just don't bother going looking for the number later on. No one else will. And we close as we do each (or mostly each) Tuesday at 4:30 p.m. with the API Oil Report. It's a report, not a number. Pass.

WEDNESDAY:  Asian/London Session: Absolutely nothing of any value dropping in either session. Pass.

          USA Session: Final Wholesale Inventories at 10:00 is one that has had Zero Impact on the charts since they started tracking it with an abacus and keeping track using charcoal marks on a shovel head. Absolutely Pass.  Crude Oil at 10:30, 10 year bond auction at 1:01 p.m., Fed Meeting Minutes at 2:00, and yes, it's Red Folder but no, there isn't much you can do about it or with it, so Pass. Finally, that Consumer Credit number drops at 3 p.m. after anyone who cares has already shut down for the day. Pass.

THURSDAY:  Asian/London Session: Yet another session where a bunch of electrons had to needlessly die to create a calendar session with such barn burners as German Trade Balance (2:00 a.m.) and the Japanese PPI (at 7:50 p.m. (and whose last 3 numbers of 4, 3, and 5 go a long way of supporting the idea that PPI numbers only matter to traders if they originate in the USA). Pass on the entire session.

          USA Session: Just a dumpster full of garbage. Weekly Unemployment at 8:30 (formerly red folder, now beige, awaiting a final decision to turn yellow). Pass.  Fed Speak at 9:00, Existing Home Sales at 10:00, NatGas at 10:30, and the 30 year bond auction at 1:01 p.m. Just a whole lotta Pass.

FRIDAY:  Asian/London Session: Early session is comprised of the EU member states dropping their own CPI numbers, which the EU incorporates into their CPI number, which usually generates about 10-12 pips in the hour after dropping.  I don't need to see these charts to already know what they say: they say Pass. The only vaguely interesting number drops at 8:30 with the Canadian Non-Farm Payroll (they call it something else but that's pretty much what it is). It usually appears on the 1st Friday of each month, paired with the US NFP. And since I look at the USDCAD to get a feel for how the charts react to the numbers, when the US and Canadian NFP drop same day, same time, the U/C is kind of a roller coaster ride.  But some months the Canadian version drops a little late and ends up a standalone number.  Over the last 3 months, the CAD NFP has been a standalone number once. The numbers generated were 15, 39, and 27. Can you guess which month the CAD number dropped without the US support? If you guessed 15, go to the Head of the Class! And today, the CAD NFP is a standalone again.  I'm not going to say Pass though. Since this week has been so miserable in terms of tradeable numbers, and this is the last one we're going to see for 3 days or so, it's probably worth keeping an eye on at a bare minimum. But just like I mentioned earlier, if price stalls out around +15, don't be ashamed of closing out the trade and banking the meager winnings. Some is better than none and a hell of a lot better than -15.

          USA Session: Nothing aside from a floating Fed Monetary Policy Report. Don't know when it will drop, if it drips at all (and I've seen this appear and then disappear from the calendar twice in the last 6 weeks so not showing up at all is a legitimate bet to make). Plus, it's a report, so not much to work with here anyway. So Pass, and maybe give some thought to making this a 3 day weekend. I'm planning to do that myself.

See you back here next week with more Summer Doldrums forecasting.

Jeff