Daily EUR/USD, GBP/USD, EUR/JPY Analysis September 29, 2014
The EUR/USD did make that third push Friday having come off the lower level at 1.2753 rather than going up to test 1.2766. However I wanted to point out that they pushed it 30+ pips from the days highs before they stopped it at that level. This is often what they will do as they get orders stacked in their favor before they make the push. As for the set of legs to the lows, I did have a member skype me about them of which I said they were nice but I wasn’t happy with the level so passed. I sure hope some members caught the short from the trapping to the 1.2753 level. The best entry was after the pin because the legs weren’t that great. Once it pulled back to the 1.2753 it was a low risk entry that never went more than the spread against the trade.
As for today I will be expecting the reversal off the lows. Its at a very significant daily low that it will take some conviction to break. However it wouldn’t surprise me if they go into extended pushes here with all things considered. Of course they will more than likely give us a 40 to 50 pip reversal first as they push out weak holders so I will be watching for a set up at the Asian lows or just below at the 1.2662 daily low from November 2012. If we get a daily close below that level this week the next level to likely test is down around 1.2500. I will be open for the short at 1.2715 but only if I miss the long or I will be looking to take profit and call it a day.
The GBP/USD had a nice push down for almost 100 pips Friday and even had a 40 pip long in it from the psych 1.6300 level. The set up for the short wasn’t really there and had I caught the long I would have been knocked out at break even on the move down. Today I will be looking for the next push down but I am a little concerned with the bottoming formation starting off early in Asia this morning. Even though the pushes are clear the first is intraday while the second could be a first long term. Either way I am looking for the short but one is stronger than the other on probability. The best level for the short is up at 1.6275 but considering the drop down this morning and it being 60 pips from the lows there is a good chance they stop it at 1.6254 for the push lower. It will take a lot to convince me they are going to be pushing it up today so if they do I will likely miss it.
I did not catch the EUR/JPY trade Friday. In all honesty the trapping wasn’t as clear as it was on the UJ. At the time of entry I wasn’t watching the UJ or I might have taken that, needless to say I didn’t. With the EJ making the reversal as I expected I will be open on direction today. Since they didn’t make a full push the chance that they start more pushes to the downside is better but the safer way to approach this pair is to be open on direction. If they do manage to test the lows during the Asian session I will be open for the long from there during London but if they don’t show anything clear on a set up I will wait for the run up to 138.76 or the Asian highs. Being in the middle of the range the entry is more risky there so It will need to be a clean set up. Otherwise the safest short will be from the psych 139.00 level.
Forex News Today
The calendar is slow during the London session today only releasing some German CPI data when the NY session starts. It will be trickling in all day but the final figured will be released then. For the most part I dont expect much baring a big miss and I doubt that will happen.
The US does have Pending Home Sales later in the day but thats pretty much it until Asia starts back up tomorrow. They are expecting a drop below zero but not much so any thing better than zero will be good but I dont expect much movement on this either. Housing just isnt as important as it used to be so will be awhile before it is again.
During Asia tomorrow the Japanese have Household Spending, Industrial Production and Retail Sales. The big ones are the latter two but if they are close to expectations while the Spending data misses big then they will push the Yen around.
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