June 13, 2013 Analysis of EUR/USD and GBP/USD
We got the third intraday push on the EUR/USD yesterday as I expected in the daily commentary. However it also managed to push a little deeper than the level I saw as the highest probability at 1.3291. Even though the 1.3267 level was not mentioned specifically in yesterdays commentary as you can see I always start my day by moving the lines accordingly to the levels that have the highest significance and probability to see the manipulation at. The good thing is the set up at the 1.3291 level was questionable and warranted waiting until there was more clues and I will explain why during the live London session to members today.
I did take the entry after the second test of the 15min 200EMA and had to endure 17 pips of heat while I waited for the shift. With the US session getting rolling soon after I almost manually closed it at break even but wanted to give the US pump a chance to kick in. Once it shifted away at the 8:30 (NY time) candle it was worth holding and tightening up the stop so at least I wouldn’t take a full hit. By the time I was ready to get off to bed for the day it was getting close to my take profit at 1.3352 so I moved the stop to +30 and went to bed and woke to a nice 70 pip profit.
As I was talking to a member who actually got a better entry than I did by about 10 pips. He was 60 pips up and had the same TP I did but tightened up his sop and got knocked out before the last push up. No worries Felix you followed your plan which is much more important than another 30 pips. 🙂
I will be being cautious today considering the intraday pushed are a little less reliable for the reversals but that will be what I am looking for first. The levels I will be looking at for the short are the current Asian highs if they hold or possibly the 1.3394 daily level but only if the hourly close above the current Asian highs happens during the Asian session. If London has the conviction close above I will look for the long on a pullback, most likely to yesterdays highs at 1.3358 or the Asian lows this morning. All of these set ups will need to be rather clear as this is a third push chop scenario.
The GBP/USD made a very weak push for only 68 pips so its hard to say if it is finished or not. However with the rejection we are seeing this morning I would say it is a topping formation taking shape. the daily level I mentioned in yesterdays commentary held well yesterday even though it had a hourly conviction close above it. As I always say to members even though we are looking for the conviction intraday, what is most important about daily levels is that we see the daily close above or it is still valid the next day.
I will be keeping an open mind on this pair also today with a small bias for the short the way price action is going this morning. What I see as the highest probability for the short would be a run down during Asia and a stop run to the current highs at the psych level of 1.5700. Otherwise I will consider a long from either Tuesdays highs at 1.5651 or yesterdays lows at 1.5631 of course keeping an eye on that hourly close.
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Forex News Today
The calendar is light today with only the ECB monthly report and an Italian bond auction during the London session. The report will likely echo the statement and press conference but the big boys will be looking to see if the issues have changed much that would increase the chance of another rate cut. The Italian auction does have a chance of not going so well but my thoughts are it most likely will and be a non event.
The US only has Retail Sales figures and Thursday Unemployment Claims. Retail Sales is expected to be positive but not much so a miss to the upside will be positive and the opposite for a disappointment. There wont be much without a larger miss in either direction. Claims are expected to drop slightly and I don’t expect much without a big miss here either.
Some Ric Santelli and Jim Cramer
This was kind of funny to see that the majority of these guys said they had no clue that UoM released the data on Consumer Confidence early to those who could pay for it. To be honest I didn’t know either on that particular release. However considering Reuters releases other data 2 minutes early to its subscribers and it has been well known and publicized for years (just check Forex Factory in PMI figures for the UK) it to me would seem at the very least naïve or at worst stupid to think that wasn’t true for other releases. Like we have been seeing more and more of these “leaks” lately. I have to say I disagree that HFT will be around forever considering all the bad publicity, investigations and legislation being considered on banning it. It would only make sense to me that the retail investors sitting on the sidelines will only come back to the market if some radical changes are made. however I will say it again. Common sense is not all that common. Anyway enjoy the video.
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