Daily EUR/USD, GBP/USD, EUR/JPY Analysis August 3, 2014
When it rains it pours they say. Well that applies to my situation as well with the emergency last Friday and this morning my computer goes down so here I am at the internet cafe getting my commentary done. I will be brief and to the point today.
The EUR/USD made a first push up on the terrible NFP data last week so I will have the bias for the next push today while still open for the short from the highs. With the good rejection at the 1.3440 level I have my doubts there is enough conviction to keep the move going since the way it looks the Fed wont be ramping up more QE in the near future. The best levels for the long during the London session today are 1.3414 and the psych 1.3400. As long as they hold this low and run it up closer to the highs this morning then the Asian lows are valid as well but I will need to see them play the breakout traders to the Asian highs if the range stays tight.
The GBP/USD made an extended push to the downside Friday with no false push or fake out to push out weak holders so the possibility of the reversal is still there and its best to be open on direction today. It did test the next daily breakout support so if it does manage to drop below Fridays lows with conviction we will likely see them push to the 1.6739 level before turning. The best level for a short is at 1.6840 but they may push it as high as 1.6856. If they do run it down early in the London session I will consider the Asian highs or lows depending on how big the move is. The only place I will consider a long is at Fridays lows with clear signs they wont let it pass.
The EUR/JPY tried to make a push up but ended the day at the lows with risk aversion taking hold after NFP. I wont have a bias on direction on this pair today and look to trade the highs for the short or lows for a long. The 137.85 daily level is valid for a short but carries more risk so I will need them to push lower during the Asian session to consider it.
Forex News Today
The calendar is slow today with only UK Construction PMI data during the London session. Expectations are for a slight drop and I expect it to be close. I havent been seeing much on ending the help to buy scheme so there isnt much reason to believe it will miss much. Otherwise if they are going to make a push today it will most likely be risk related.
Asian session traders have Chinese HSBC Services PMI and the Aussie interest rate decision tomorrow so it would be best to wait until after the release to be trading Aussie crosses.
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