January 23, 2013 EUR/USD, GBP/USD Daily Analysis
The price action on the EUR/USD yesterday was about as sloppy as it gets whipping around like a chicken with its head cut off. Of course there was news to start it off during the Asian session only to have Europe throw in its share. It would seem as though the algos had a hay day with the news wires. 🙂
At this point it is best to keep an open mind on direction and look to the significant levels for the manipulation. Since the safest entries would be taken at the highs or lows of yesterday and price it rather far from those levels right now I will wait for the Asian session to finish and see where they drive price. If it manages to stay in this tight range I will be looking for the confluence at the 200 EMAs or there is a good chance that it will just chop around again today while they make up their mind.
The GBP/USD is holding a much smaller range and this pair is the one I will be looking to trade today. We did get a trade during the live London training session with some nice manipulation at the lows. Great job to any member who got the 50+ pips that was there before the reversal down.
With the lows still in tact at the 1.5800 I do have a slight bias for the long on this pair today. There is a nice bottoming formation and price did spend some decent amount of time above the Asian highs yesterday with a slight hourly close above it. I am still sticking with what I mentioned in the room that even if they do intend to break these lows there should at least be a shake out of weak shorts while they do a push to the upside. The best level for the long is again the 1.5818 area but just as yesterday I will be wanting an entry as low as possible due to the fact they may try and do a stop run to the lows around the 1.5800 level. The only way I will take a more aggressive entry is if the manipulation is very clear. I am still open for a short here but only from a stop run to the highs from Monday at 1.5882 or possibly the NY reversal after we see the first push up later in the day or if we get an hourly close below the 1.5800. Then I will be looking for the manipulation to the upside for the short.
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Forex News Today
Scheduled releases today look a lot busier than it is. The big one of note is the MPC Meeting Minutes from the UK. With Governor King saying yesterday that more Asset Purchases are ready if needed there may be some talk in there of increasing them and if so will be GBP negative. Otherwise there is their Unemployment rate but this will be overlooked unless there is a big miss.
The US dont have any releases of note today.
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