Hi Folks.

Before we get started with the Forecast for this week, just a quick reminder that we are in mid-Summer, a time we traders not-so-lovingly call the Summer Doldrums. Price action is just not that great right now, and in August is likely going to be even worse. Most of Europe takes the entire month of August off and heads for a beach somewhere, and most years I do the same (I take he time off from trading...I live in Florida so I'm never more than an hour away from some beach all year round.). So if you're setups are looking kind of shaky, or not spitting out the pips/points like they were in the Spring, worry not. Once Labor Day is behind us things will return to some semblance of normalcy. And yes, even though I'm taking a break from trading, I'll still send out these forecasts each week during August.

On to the forecast.

MONDAY: We open the week with the Empire State Manufacturing Index at 8:30, followed by Head Fed Poohbah Powell at noon and lesser Fed Clown Daly at 4:30. For reasons I am at a loss to understand or explain, the FF calendar lists the ESMI as a red folder news event. When I see red folder I think "big economic deal" which the ESMI definitely is not. It's not quite as irrelevant as the one out of Richmond, but it's a lesser number to the Philly Fed number, and that one got downgraded to beige folder status some months back. It would not be correct to expect some decent price action to develop around red folder events, but it's just not likely to happen with this one.

TUESDAY: For the second day in a row we have some red folder news at 8:30: Retail Sales (Core and overall) along with Import prices (yellow folder) and all lost in the shuffle of about a gazillion Canadian CPI numbers. I've mentioned before and will say it again now: Retail Sales used to be one of the bellwether numbers traders looked at to gauge the health of the economy, so a number that misses the expectation used to generate some price action. Since the focus has shifted almost entirely to Inflation numbers (which is what Import Pricing is) Retail Sales has lost a lot of it's previous impact on the charts. A seriously off number could still end up pushing price up or down some, but if the number is anywhere close to being on target, this is another red folder report that likely won't mean anything to traders. The rest of the day are some lesser numbers (Business Inventories and the NAHB Housing Market Index) at 10, neither of which historically have any impact, and yet another Fed clown (Kugler) at 2:45. A lot of numbers today but nothing that looks like it has the ability to move the charts around.

WEDNESDAY: Sort of like yesterday, a lot of numbers, but nothing worth paying attention to (unless you trade Crude at 10:30).Building Permits/Housing Starts at 8:30, Fed clown Barkin barkin' at 9:00, Industrial Production/Cap. Utilization rate at 9:15, Crude at 10:30 and the Fed's Beige Book (a non-event so don't bother sticking around) at 2:00 p.m. As they say in Texas, these numbers are all hat, no cattle.

THURSDAY: The aforementioned Philly Fed Manufacturing Index is set for 8:30, a formerly red folder report now downgraded to beige (along with the unemployment number, which I rarely mention here because it comes out every week and is universally ignored every week). Philly Fed is a "zero" number meaning anything above zero is good and anything below zero is bad. Economists, both real and the fake bartender variety, expect the number to come in slightly above zero, at 2.9. That's above zero, so I guess that makes it good. But if it comes in below zero, watch for some fireworks. There haven't been many numbers set for this week, so a bad number will give the few traders who are still around right now a reason to start firing in some trades. If the number hits the mark, or is even a little better than expected, it likely won't generate enough activity to be worth trading.

FRIDAY: Two Fed clowns (Williams and Bostic) at 10:40 a.m. and 1:00 p.m. respectively. I could have alternatively written "no news" for Friday. Either is 100% correct. Take the day off. Enjoy an early start to the weekend.

Jeff