EUR/USD, GBP/USD Analysis August 30, 2013
We got the second push on the Euro yesterday with it taking off during the Asian session and never looking back. In a normal situation I would be expecting the third push but being its Friday and the end of the month there is the possibility we see the flows at the end of week/month today and get a reversal. I should also point out that the second push was long and it is presently sitting on some solid daily support. I will have a small bias for the short since the war drums are still pretty loud even though Cammeron from the UK got a bit of a slap from parliament yesterday with them voting not to attack Syria. The problem is its looking like Obummer is willing to blacken his own eye and go it alone. Lets hope he’s not that big of a fool.
The best levels I see for the short are at 1.3250 and just above at 1.3266. When considering a long I would prefer to see the stop run to the lows but will be open for a play of the breakout traders at the Asian high and low if the range it tight. Otherwise if we do get the hourly close below yesterdays lows during the London session I will remain bias for the short and look to trade the continuation. If that does happen I wont be holding for a long run since the end of week/month flows have a good chance of slowing it down.
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The GBP/USD could only muster a 60+ pip move to the downside showing they may be ready to reverse now which would agree with a pullback to the upside on the weekly/monthly flows as well. Now that it has extended pushes and a nice daily pin that has held, well my gut tells me they will make the attempt at the pullback. There isn’t anything clear on the pushes as of now so playing it safe is the best option. The best level for the long is yesterdays lows and if it gets the hourly close below those lows they will probably test the overall lows at 1.5426. The opportunities for the short are at the psych 1.5520 but being in the middle of the chop it carries more risk. The better place is 1.5551 but if it gets there I hope I am in a long position and it breaks 😉
Forex News Today
The economic calendar is light with nothing high impact of note. Therefore I expect the end of week/month flows along with the war drums to be what gives the best chance for manipulation and good entry. I have my doubts they will break these daily lows on the Euro and the GBP/USD looks to have the better chance for the reversal now all considered.
Have a great weekend
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