Daily EUR/USD, GBP/USD Analysis May 13, 2013
First of all I hope all members and nonmembers alike had a great Mothers Day.
We did get the third intraday push on the EUR/USD Friday which increases the chance that we see a reversal today. It may not be the full blown reversal we might normally expect if the market was trading the long term pushes but at this point keeping an open mind on direction. With the GBP/USD showing two clear long term pushes the Euro will either go into extended pushes while the GBP/USD makes its third push or the Euro will reverse while the GBP/USD holds or turns also. It will all depend on the USD and probably more so what the big boys think of the Hilsenrath article that started as a rumor last week but did come out late Friday. Even though this guy is seen as the Feds mouthpiece and has somebody leaking him information my thoughts are this may not be seen as that much USD positive unless we start to hear more Fed speak that backs it up. I will say there has been a little rhetoric but I have my doubts it was substantial enough to create a sustained move without some backing from Bernanke or at least Yellen.
The level I will be willing to take a long position are at the lows Friday of 1.2935. Seeing a clear stop run below there would be optimal but I will be watching for an hourly conviction close below and if I am long I will be closing the trade break even/small loss and look for the short. The levels I will be looking to short from are the highs after London closed Friday at 1.2994 or the breakout level of 1.3009.
As I mentioned above the GBP/USD is clearer looking at it as 2 long term pushes to the downside and I will expect the third today. Its possible that the highs during the end of the US session Friday will hold but I want to see the Asian range widen up or see it tested during Asia then see them play the break out traders there with some clear manipulation. Otherwise the 1.5380 level has a better chance with the 4 hour 200 EMA sitting just above.
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Forex News Today
Scheduled releases are light during the London session but there is the start of another Euro group two day meeting so we will most likely get at least a couple “all is well” tape bombs if not more. I still don’t see that anything has changed in Euroland but I guess if they can make everybody think all is well than they can at least buy time to get their ducks in a row. Will it be enough? Probably not but as I have said many times nothing surprises me about the markets any more.
The US does have Retail Sales figures released today. Expectations are for a slight improvement but still below zero. If we see a surprise into positive territory I am thinking it will need to be big to create mush USD strength but a miss to the downside will have a more negative impact for the USD with a smaller miss.
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