Daily Forex Commentary EUR/USD, GBP/USD September 21, 2012
Yesterday we saw the third push down on the EUR/USD beginning during the Asian session and never looking back. With bad data from China and the growing rift between China and Japan causing a risk off scenario that just never caught a break all day. The New York reversal did provide some pips to those that took the aggressive entry but thats a bit late in the day for me.
Today I will be looking for the reversal to continue on the EUR/USD to at least the break out level of Wednesdays lows of 1.2990 and possibly push up into 1.3000 where there is a good possibility for a 1 hour stop run entry for the short. At this point it has a higher likelihood of going into a third push chop as the GBP/USD hammers out a third push to the downside from the larger pullback it did after making its second push down yesterday. So once this range is established trading it from the extremes will be the safer bet rather than looking to see the full blown reversal at this time.
The GBP/USD really only needs a push to break yesterdays lows to be considered as fulfilling the requirements for the third push to the downside today and at that point the chance for the reversal is higher. If we do see that the support level at yesterdays lows and the hourly 200ema at the 1.6150 area hold then we will be in a third level chop scenario along with the Euro. First off today I will be looking to see if we can get the test of yesterdays highs of 1.6235 for a 1 hour stop run for the short but it sure looks as of now that the resistance of the psych level at 1.6220 is holding during Asia so we may only get the test to that price area before we see the push down today.
Forex News Today
Scheduled news releases are light today with only Public Sector Net Borrowing from the UK and late in the London trading day there is Belgium NBB Business Climate. I dont expect much from either of these releases so the action of the day should be mostly price driven barring any tape bombs that may be dropped. However the change is not all that high for one of those but you never know.
End Of The Week
I always try and find something educational and enjoyable to end the week with but after a couple hours of searching I just couldnt find anything worth while to show you all. It seems that since we have all jumped on the money printing wagon around the world we are in a wait and see mode while everybody holds their breath hoping that all this money doesnt cause the inflation we all know is coming. Its just a matter of time.
Since we cant have educational and enjoyable I decided that enjoyable will do. Here is a pic that is food for thought.
Have a great weekend
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