Daily EUR/USD, GBP/USD Analysis July 25, 2013
This morning I woke up thinking about the comment on yesterdays commentary asking what made me think the EUR/USD would turn at the 1.3253 level. To be honest when it hit me that the EMA I was looking at was the 800 rather than the 200 on the daily chart I was surprised that I didn’t have a bunch of comments telling me that the 200 EMA was not there and about 200 pips lower. I’m comfortable calling it a typo but members will know it was more likely a brain fart since they know how I use the 200EMA on various time frames by putting the 800 on a chart so I can know where the 1 hour 200 is when I am looking at the 15 minute chart. Thanks for not raking me over the coals guys 😉
The price action I see today looks more like a first push down and considering all the pushes over the last 5 days have been around 70+ pips I will be treating this as the first push down with a small bias for the short. Its also possible this is a false push to clear out weak holders before they keep on pushing it up too. Which is why I will still be open for a long.
The problem I have with a short is the best level is very close at 1.3200 so in order to consider a trade there I would prefer to see them push it down during Asia this morning and test yesterdays lows then play the breakout traders there during London before they come back and give the stop run to 1.3200 or at least have them leave the Asian box around the lows then come back and show they wont let it pass 1.3200 with some nice trapping patterns. Otherwise I will consider a long form yesterdays lows at 1.3176 or Tuesdays lows at 1.3162 depending on the price action.
The GBP/USD has a clearer push down with a nice 100 pip run to the lows yesterday. However the choppy price action before the move concerns me a little. It shows that they might have been fighting a bit before the US session took charge and dropped it after London closed. I will have the same bias short here also but the same is true with the best levels in close proximity to current price. The 1.5324 seems the best but they could easily push as high as 1.5339 or even 1.5366 before they turn it south.
There is also the chance of this being a false push as with the Euro but again the best level is too close for comfort at 1.5293. They do seem unwilling to let it go past the 1.5300 psych level but I would want to see another test and the right price action during the Asian session to take an aggressive entry there. They may also push it as low as 1.5280 where there is daily support so I will be wanting to see some nice trapping to take it above there.
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Forex News Today
Scheduled releases start off with German IFO Business Climate figures. Expectations are for a rise and with the manufacturing data having a small surprise upward yesterday it increases the chance that this could do the same.
The UK has GDP data also expecting a couple ticks up so watch for the surprise here as it could go either way.
The US has Durable Goods and the Thursday Unemployment Claims releases at the same time so I will be watching for conflicting data. Since the New Home Sales was better than expected we could see a surprise up in Durable Goods but a surprise increase in Unemployment Claims will trump that if its bad enough. Be careful around that time of day guys.
This Video Cracks Me Up
I had to share this Rick Santelli video with you all. Its not so much that I enjoy his rants in this case but the CNBC bonehead (I cant recall his name nor would I want to) commentator sitting next to the pretty girl. I almost fell out of my chair laughing when he literally said the Fed should just print 85 billion or more per month for literally for ever. Of course after they all admit that the so called recovery is due to nothing but the Feds print fest. This guy should be exported to Zimbabwe to see what that does over time. I should also point out that there was actually some truth brought out by the guest in that the real unemployment figures are actually around 30% taking into account all the folks that are able to work but don’t want to find a job. Not only are the numbers a big lie but something is wrong when such a large part of the folks who can work don’t want to. I wonder why? Government hand outs maybe? Of course Rick is good and to the point as usual. Enjoy
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