US GDP tomorrow-50 50?

The Dow rallied off its 10,000 base as earnings from the likes of UBS, Alcoa, Caterpillar have gotten earnings season to a great start. However notice the Dow is finding it difficult to hold, let alone break through 10567 resistance.
Initial jobless claims falling to 11k to 457k.
GDP forecast at -2.5%, which is to be expected with what Greenspan described as the natural "wall" facing the economy in June, implying his view that its a momentary setback.
The dollar index falling back down to 81, just like it fell back last earnings season, with risk aversion falling away as earnings takes the spotlight away from Greece and the eurozone issues. Also of note is that Gold has sold off, as the dollar declined, having recently broken its 50 day moving average, and breaking below 1160 briefly yesterday, and now up to 1167..
Talk of deflation and a possible japanese style outcome for the US economy by a Treasury member, adding to possible concerns of a larger scale slowdown.



Dow 10457
FTSE 5290
GBP/USD 15608
EUR/USD 13074
Crude 7834
Xstrata 1031


Right now, from comments from Bernanke and the Fed revising their estimates, and pushing back when they think unemployment will decline below 9%, even if GDP outperformed no one is going to be bringing forward expectations of interest rate increases. So until earnings season is over the Dollar is likely to remain weak (until risk aversion over Greece etc comes back in).

Worse than expected GDP will weaken the dollar, but only slightly, as pretty much everyone is looking at a weak Q2 result. If GDP outperforms I see the potential rally in the dollar to be greater.

Given the Dow is close to resistance I would be looking to go Short Dow, prior to the results, and close it out at 10420, 10410 before the results. Then if the results are positive, wildly larger than expected, buy into the Dow 10470,10490 to target 10550.

Buy USD index at 81.50 to target 82.50.

Trading Idea for UK Open 30/07/2010 (if GDP better than expected):

1) Short Dow prior to result, Sell 10450 and above, stop 10475, target 10400 before results


Immediately after results if Dow rallys to 10470-10510, as indicative of good news

Buy dow, 30 point stop at recent support, Target 10590

2) Buy USD index 81.50 equivalent, to target 82.5