Daily EUR/USD, GBP/USD Analysis June 5, 2013
With yesterdays price action on the EUR/USD it seems as though the big boys are waiting for some more news to tell them which direction to push the market. We have a meager 57 pip range yesterday which tells me they are waiting for something. Since there is some big news coming for the next 3 days I cant say I blame them. Today is ADP Nonfarm and rate decisions Thursday and the big NFP Friday s there is a decent chance we will see the same thing today up until ADP which without a large miss will probably be a non event. Therefore the only thing we can do is wait it out and trade the plan.
Today I will be focused on the hourly conviction close during the London session to give me a clue on direction. The first levels I will be looking at are 1.3089 for the long and 1.3056 for the short. Keep in mind the conviction will need to be clear and see a close at the extreme of the candle in order to be confident in seeing a break of the more significant levels which are 1.3106 for the long and 1.3042 for the short.
On a side note I am still holding a short from 1.3092 from yesterday hoping for the break down but not really that confident they will give it to me since they have almost knocked me out break even four times while I slept. I guess at least I am still in for now. My buddy Felix got popped by a pip or so with a little worse entry I am pretty sure. They are some sly suckers 🙂
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The GBP/USD is in a slightly different situation looking a little more bearish on the price action but still managing to have the close in the middle of the 68 pip range. The same thing applies on direction here. Since there is some significant resistance at the 1.5320 level, seeing the hourly close above will be convincing that they will take it long. However with the 1.5340 level just above it will need to be closing at the extreme just like the Euro. Otherwise I will wait and see the reaction at the upper level. Since the 1.5280 found good support yesterday it qualifies as a good level but to be totally convinced they will take it short it would be best to see the close below the 1.5272 level even if its just by a few pips. The closer to the lows of the candle the better but I will cut it a little slack as long as it closes below. As usual after we see something happen giving clues on direction I will wait for the pullback and manipulation against the conviction close.
Forex News Today
The calendar starts off with low impact Services PMI figures from Spain, Italy, France, Germany and the EU as a whole. The way I see these is there will need to be a substantial surprise to get a decent reaction of which I doubt.
The UK also has Services PMI and is a medium impact event. With some better than expected data lately this does have a chance to surprise to the upside but since its well above 50 already it would need to be big to create a sustained move. The logic is that yesterday we had a HPI figure that was better than expected, popped above 50 nicely and what did we get? Just about nothing.
The US has ADP Nonfarm expected to rise but I have my doubts. Considering its 2 days until the real (fixed) NFP figures this always needs a big miss to make a sustained daily move. Later in the day is the ISM Non-Manufacturing Index but I doubt this will be much. The Beige Book later on may surprise so keep that in mind if you are in a trade during the end of the S session.
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