EUR/USD, GBP/USD Forex Commentary June 25, 2012
The EUR/USD has had yet another gap to start the week off. This time not such an intense gap as we have seen in the recent past. However the fact that there was not much interest in closing it tells me something of the Euro weakness. There is still the chance of it to close during the London session and thats where I will be looking for the manipulation for the short.
We have seen the first push to the downside again after the failed push last week and the topping formation I talked about in the June 21 forex commentary so I will be looking for the continuation of the down move today. With the fundamentals backing the smart money trend I will consider holding this position for the third push later in the week providing I get a clear entry today. The red line on the chart is an hourly break out level that held well on Friday and I dont expect it to be broken during the Asian session. Since the Asian high coincides with the gap open. That will be the first place I look for the trap move.
The GBP/USD has opened with a gap also but was filled within the first few candles. Considering the Euro weakness I wont be looking as close at this pair today but will be keeping an eye on it as any USD strength will drag it down withe the Euro. However with the potential for the EUR/GBP dropping heavy too the move may be limited.
The clearest count on the pushes are that we have seen either 2 intraday pushes and are expecting the third or potentially the first push long term and expecting the second. Either way the short is the higher probability. At this point I favor the first scenario as the moves from the top have been 90+ pip moves. Having said that I will be looking for the potential deeper pullback during the London session as any weakness in the EUR/GBP will have an upward push for the GBP/USD either into the 15min 200ema or the previous resistance at the 1.5600 level.
Forex News Today
In short there is no news today. We do have New Home Sales from the US late in the trading day but that is it. The way I see it is there will still be plenty of tape bomb news with the upcoming EU Summit in a few days. They will be trying their best to show that they have found the grand plan all while other news that is released shows that they are no closer to solving the issues that actually caused the crisis than they were 2 years ago. Go figure
The World Of Liars
I am relatively sure I have mentioned this before but every so often as I am reminded my self of such things going on in the world that should not be ignored as they are we see more on the Chinese and how they manipulate their figures. Much like the US does even if its not to such an extent as the Chinese. This is from the Financial Times.
As the Chinese economy continues to sputter, prominent corporate executives in China and Western economists say there is evidence that local and provincial officials are falsifying economic statistics to disguise the true depth of the troubles.
Record-setting mountains of excess coal have accumulated at the country’s biggest storage areas because power plants are burning less coal in the face of tumbling electricity demand. But local and provincial government officials have forced plant managers not to report to Beijing the full extent of the slowdown, power sector executives said.
Electricity production and consumption have been considered a telltale sign of a wide variety of economic activity. They are widely viewed by foreign investors and even some Chinese officials as the gold standard for measuring what is really happening in the country’s economy, because the gathering and reporting of data in China is not considered as reliable as it is in many countries.
But an economist with ties to the agency said that officials had begun making inquiries after detecting signs that electricity numbers may have been overstated.
Another top corporate executive in China with access to electricity grid data from two provinces in east-central China that are centers of heavy industry, Shandong and Jiangsu, said that electricity consumption in both provinces had dropped more than 10 percent in May from a year earlier. Electricity consumption has also fallen in parts of western China. Yet, the economist with ties to the statistical agency said that cities and provinces across the country had reported flat or only slightly rising electricity consumption.
You just cant make this crap up.
If you would like more information on how to trade with the banks please view our forex bank trading course & forex forum description.
Do You Enjoy The Daily Forex Commentary? Please Click The Like Buttons Below & Tweet It !!