Daily

.
HSBC and BNP Paribas earnings proved catalytic. China PMI and US ISM data certainly helped the broad rally as well.
The ten day range was cleanly broken with a strong close, suggesting a new ten day range will be established this
Journal week, if not a break of the three month range. The euro also closed above key resistance. Many more markets rallied
02 Aug 2010 sharply by August standards. Tomorrow, inflationary and growth data on tap and the earnings bonanza continues.

Calendar GMT Area Event Mkt Risk Exp Prev Remarks

Tuesday 0130 AU Retail sales Jun MoM Ccy Med 0.2 AUD pairs, watch ex-inflation Q2
0430 RBA rate decision statement (Aug 3) Ccy High 4.50 4.50 AUD pairs
0715 CH CPI Jul YoY Ccy High 0.5 CHF pairs, watch MoM Jul
0900 EU EZ PPI Jun YoY, MoM C/E M/L 3.1 3.1 DAX, EUR, CHF intraday, not a big mover
1230 US PCE deflator Jun YoY C/E High 1.9 ES, DAX, DX, CL, ccy majors, watch core
1400 Pending home sales Jun MoM C/E Med -30 See above, likely priced in
2100 ABC consumer confidence Equ Med Likely priced in

Tuesday's theme: Chinese PMI data helped set the tone for a broad rally in risk overnight. US ISM data surprised to the upside,
with the labor component suggesting good employment figures this coming Friday. Both HSBC and BNP Paribas printed strong
earnings, together responsible for some of the rally in US stocks. HSBC is Europe's largest bank by market value. BNP is France's
largest bank. Their earnings confirmed in the minds of speculators the results of the EZ stress tests. Particularly encouraging was
that the sharp increase in profits was driven by less bad debt. The strong showing could provide more momentum for financial
stocks, and lift the broader market this week. I will be watching Barclays, Lloyds and RBS as they report later in the week.

Trade ideas:
Long -- Trade a bounce above 6320 targeting 6360, trail thereafter. Fade moves to 6450 on responsive selling after EU close.
Short -- Trade a failure below 6260 targeting 6220, trail thereafter. Trade moves to 6120 on responsive buying after EU close.

The Lonely Trader

Disclaimer: All information is provided as market commentary and not as investment or trading advice. The Lonely Trader
expressly disclaims liability, without limitation, for losses or damages resulting from reliance on such information. Past
results are no guarantee of future performance. Please consult a registered financial advisor before risking your capital.
 Extreme range H ↗
DAX 30min
It is tempting to call a key break in the two week range. DAX
broke out and closed at 6284, just shy of the high at 6310,
for a 2.2% gain. There is still work to be done if I am to
believe a real breakout is taking place. For starters, I would Likely range H
like to see a sustained break of the 21 June high at 6359.
Nevertheless, today was impressive -- a low volume attack, Trade a bounce above 6320,
putting fear into the minds of those considering a short at targeting 6360 and trailing
the range high. The euro and crude also printed impressive thereafter.
gains, considering the headwinds.

Primary range: 166

Alternate range: 108
High Extreme: 6450 (int range breakout)
High primary: 6390 (int range breakout) Trade a failure below
HVN
Low primary: 6175 (near range supt) 6260, targeting 6220,
Low Extreme: 6120 (int range bucket) trailing thereafter.

HVN

HVN

As always, keep in mind that range projections are

guidelines -- asking where the market will likely try to go HVN
when long and when short, and how much friction is Likely range L
involved in getting there. Keep an eye on volume and the
time of day -- particularly the US open and the European
close.
HVN

Extreme range L

Range studies for other instruments available by request.

Comments -- and insults as long as they are clever -- are welcome.
See contact info below.

Interested in contributing to this study? Jay Schneider -- FX and futures, range studies
Want to exchange ideas? Have a suggestion? San Diego Area, USA
Email
Please contact --> Blog

The Lonely Trader

Disclaimer: All information is provided as market commentary and not as investment or trading advice. The Lonely Trader
expressly disclaims liability, without limitation, for losses or damages resulting from reliance on such information. Past
results are no guarantee of future performance. Please consult a registered financial advisor before risking your capital.