BK and Inflation

I just read an article on the effect that the current inflation pressure is having on business and was saddened to find out that Burger King just last week had decided to raise its price of the Double Cheeseburger from $1.00 to $1.19 AND to remove a slice of cheese from the Double Cheeseburger currently on its dollar menu and change the name of this wonderful burger to the BK Dollar Double.

We saw an increase in producer prices but no growth in consumer prices (www.bls.gov). The dilemma corporations have to deal with. Producers need to do something to make up for their increase in prices. Some may be having a tough time passing the increase onto the consumer but what’s the alternative? Eat the cost or make the product smaller? With prices going up and demand going down businesses like Burger King are being forced to make their products smaller and raise their prices. In a healthier economy they’d just raise their prices and move on. Now if you want that Double Cheeseburger with two slices of cheese you’ll have to pay an additional $.19 or opt for the one with less cheese. Is that a good thing or a bad thing…I don’t know you decide. The thing is it’s not just Burger King. I’m seeing it all over my local area. I’m sure Burger King will be around tomorrow, but some of the smaller restaurants will not fare so well. Restaurant operators can lose money on some items but when the costs of even those items go up the problem is just exacerbated. With the unemployment rate at almost 10% (really its closer to 17%) it makes it tough for everyone.

So, if you still want a $1.00 double cheeseburger with two slices of cheese you’ve got until April 26th. That’s when the price increase is to take effect. Actually you may see it go away all together since they been getting their butt kicked by McDonalds and are in the middle of a class action lawsuit filed by the franchises over this very burger.

Morning Results 02/22/2010

Despite the extremely slow night and few stops, we should have managed to be up a few pips provided pips are getting booked along the way.
GBPUSD Long position hit first target of 15511. Move stop to just above entry and book some profit. The Short orders obviously did not trigger...leave orders in the system.
EURUSD Long stopped for a loss (about 15 pips). Short triggered and stopped for a 16 pip loss. Reentered...triggered a second time and came within 3 pips of first target. Book some profit and move stop to 13615, just below entry.
USDCAD Short triggered and stopped (-15 pips)...reentered. Long triggered...book some profit and move stop to above break even.

Happy Birthday George :)

Sunday nights trades

EURUSD Long targets 13660 (.618) and 13715 (.786)
Short targets 135372 (.382), 13523 (.618) and 13444 (1.0/Dbl bottom)

GBPUSD Long targets 15511 (R1 and .5 fib) and 15550 (.618 fib and R2 pivot)
Short targets below 15429 (pivot) are 15383 (S1 and .786 and high of adr) and 15300 (S2)

USDCAD Short targets are 10370 (Dbl bottom and gann level) and 10337 (S1 and 1.414)
Long targets above 10410 are 10433 (Pivot and .382) and 10480 (S1 and .707)

Week Ending Review

EUR/USD stopped at 13505 after an entry at 13492 and SL at 13522. You should have booked profits at around 13461 and moved stop to 13505. Bias for this pair has been to the downside…the short term bias may change. I still like the 13400 and 13000 to the downside. The down trendline was penetrated at 13540. It looks like this is holding, so now watching for price to reach 13700 and even 13800, both are key resistance levels.

GBP/USD stopped at 15418 after an entry at 15460 and SL at 15475. Profits were taken 15389 and SL moved to 15418. My bias has been to the downside and still is. I’d expect this rebound heading up to slow down and then the pair to continue further to the downside. My targets are still 15350 for a double bottom and then a clear path to 15300. If the upside prevails above 15475 (as of this writing price is 15 pips away) my upside target is 15560 to 15650, both are pivot calcs and levels of resistance.

USD/JPY stopped me at 9170 for a 22 pip loss. The entry was 9192. Bias is still to the upside with targets at around 9200 and 9250. If support at 9135 does not hold, then I'm looking for my downside targets to be around 9080.

USD/CHF worked well this week in reaching the upside target of 10790 and stopping second have of order at 10768. Initial entry was at 10670. After the stop the re-entry would have been around 10810 which would have been good for another 80 or 90 pips. Bias is still to the upside. Closed today at support.

EUR/JPY kicked my butt for the end of the week. Took two 35 pip loses on two short positions. Bias is still to the downside though. The rebound is at resistance with RSI, MACD and STOCH indicating the downtrend is still strong. My targets to the downside are still 12075 and 11600.

As for the Dollar all indicators are still strong to the upside. Remember to keep the direction of the Dollar Index in mind when trading the Dollar pairs. This will play a role in how big my orders are. But hey…that’s just how I do it.

EURGBP

US Dollar

GBPUSD