EUR/USD, GBP/USD Commentary May 15, 2013
My concern about the push up on the EUR/USD during the Asian session being a false push was validated with a nice exhaustion type candle during London yesterday. I cant say it qualifies as real exhaustion or even a stop run but it was a clear signal they wouldn’t let price rise. There was also a nice set of manipulation candle patterns in that hourly candle but it never did give me a pullback for an entry.
Today I will be expecting the next push down but my bias will not be strong since this is a first push. The levels I will be watching are the Asian highs at 1.2940 since it coincides with Mondays lows. I would prefer that the Asian range open up more so the manipulation will need to be clear at that level. The good thing is we are seeing good candle patterns already during the Asian session so that will help if we see them form at the same level during the London session. Otherwise we could se it test higher around 1.2955. The only way I will be considering a long today is a clear stop run to yesterdays lows at 1.2912 and if we get the hourly close below and I am long I will close break even or a small loss.
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The GBP/USD has gone into extended pushes and could show the reversal any time so I will cautious and just be looking at the manipulation at key levels. The best level to take a short at is the 1.5277 break out form Mondays lows yesterday but it also has a chance lower at 1.5260 but I will want a really good entry from the lower level. With a daily support level just below yesterdays low at 1.5195 I would be happiest to see the stop run there for a long entry.
Forex News Today
The calendar looks rather busy today but there are only a few high impact events we need to be concerned about. We have German French and Euro Zone GDP figures. Germany being most important as usual. Expectations are for a rise but if we see a disappointment it will be Euro negative. My thoughts are it will be close since German data has been positive lately. The UK has their unemployment data expected to drop by 3K. and barring a large miss will probably be a nonevent because the BOE Inflation Letter is released later followed by a Governor King speech explaining it. This will be scrutinized to see if he hints at more asset purchases. If he does hint that direction it will be GBP negative.
The US has PPI figures and TIC long term purchases but I doubt these will have much impact. Inflation has been so manipulated it probably wont show anything substantial and the TIC data has missed big in the recent past with not much market reaction so I don’t expect that to change this time around. A little later is the US Industrial Production and expectations are for a drop so a surprise to the upside should have the bigger reaction.
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