MidSession Review 04/07/12
The following article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.
Data releases from across the globe continue to add weight to the the view that the world economy is slowing down.
Chinese HSBC Service PMI Index at 52.30 previous value was 54.70,
Germany's service sector PMI at 49.9 versus 50.3 expected
French's service sector PMI at 47.9 exceeding 47.3 expected
European's service sector PMI at 47.1 exceeding 46.8 expected, below the 50 mark that separates growth from contraction for nine of the 10 months
Uk's service sector PMI at 51.3 versus 53 expected.
The good news came from European retail sales reading up at 0.6% versus the 0.3% expected, as gains from France to Ireland and Portugal helped offset decreasing demand in Germany.
These sets of Data had the following results: Stoxx50 fell 0.69% to 2,304.52, German Dax trades at 6,535.93 or -0.64%; on the commodity side Gold flirted with the 1,600.00 mark, it trades at 1,615.40 or -0.39%, while Oil (WTI) fell 0.74% to 87.01 after yesterday bull run. The cross lost steam, it cleared the 1.2600$ level and it's now trading at 1.2564$, -0.35% versus yesterday fixing.
The down leg of a 3 days bull run came in a day with the number of shares changing hands in Stoxx600 companies at 34% less than the average over the past 30 days, according to Bloomberg data.
Therefore you should be really careful in executing your plan, it's easy to get whipsawed by a fake move or get nervous due to the slow motion during some time interval.
For what it may concern our daily game plan we put on few trades, short at 2310 with a target at 2297 and a stop at 2317, an unattractive risk reward ratio, and to make things worse it was really painful to hold it up to 2303 just before the data. But at least we had some index points. It's a clear example how the slow motion can lead to excessive nervousness, the assumption of a slow day plus the holiday type volume made us going for a fast trade other than trying to hold it longer.
Yes now it's trading at target but before that it went straight to 2310.
Let me share with you another rule we trade by:” do not let a winning trade becoming a losing one”
Originally posted at www.77sigmatrading.com