Forex Daily Commentary EUR/USD, GBP/USD, EUR/JPY May 1, 2012
Happy May Day everybody. Its actually Labor Day here in the Philippines. Considering many countries around the world are on holiday the market could be rather boring and at the same time have potential for wild swings on low volume. This is the prime opportunity for the manipulators to be taking weak position stops so be careful out there.
Looking at the EUR/USD we are still in the nasty chop. Yesterday didnt quite turn out as I expected with a manipulation down and push up however there was a trade short. No I didnt take it as there wasnt quite enough confluence for me and I did have a small bias to the upside so in order to override that I need some good confluence to change that. Today considering the holiday it could go either way. I do have a small bias to the upside again mainly due to the fact of the fundamentals all point to downside for the Euro at the moment but given the chance for manipulation on low volume the Smart Money may have an easier time taking higher stops and I expect them to take advantage of that.
The GBP/USD looks to be starting a retracement of the long run up its had over the last couple weeks. The push up I expected yesterday never came true so at this point I will be looking for the continuation of the turn to the downside. The move down from the highs dont quite fit the criteria of a first push so a deeper manipulation up may be in store. possibly a test of the highs for a stop run. Today I will be keeping an open mind and looking for the manipulation outside the Asian range.
The EUR/JPY did what I expected in the April 30 commentary with a move down. However it never gave me a high probability trade and I did not get a trade during my best trading hours yesterday. Today looking at the hourly chart I see a clear 3 pushes to the downside and a potential bottoming formation. There hasnt been a real test of the lows with rejection to clearly show it has bottomed but the reversal is the higher probability trade today. As I mentioned above be careful out there with the volatility on low volume. Only take very clear entries and watch the USD/JPY. In order for this pair to make the reversal the USD/JPY should go with it.
Forex News Today
Given most of the world is on holiday the news is light and we only have Manufacturing PMI from the UK during the London session.
The US session has ISM Manufacturing PMI which is expected to drop slightly but still be well above 50 considered to be expansion. I have my doubts this its self will move the markets but may look like it does as they use any deviation and the low volume to manipulate. At the same time the US PMI figures there is Construction spending and ISM Manufacturing Prices both of which are low impact events. After that there is 2 members of the Fed speaking 30 minutes apart. My feeling is that these guys will be watched the closest and the market will try and get a clue for any more QE. I think the market will be disappointed but dont go by my thoughts on that since these guys do what I expect only about 50% of the time haha.
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