EUR/USD, GBP/USD Analysis December 17, 2013
Todays commentary is going to be short due to some meetings I have to take care of this morning and I’m going to spare you guys the surgeon general warning on trading this time of year 😉
At this point it seems as thought they have hammered out the range they will potentially keep the EUR/USD inside of for the time being. The Fed could easily change that when the have the meeting tomorrow but for today trading the high or low of yesterdays range will be the best opportunities. There are the two levels in between at 1.3768 for the potential short and 1.3741 for a long but taking entries there adds risk so be very particular about the set up and if unsure just let it go.
The GBP/USD has made its reversal and has potential for a push in either direction. By looking at price action alone it looks more to be headed down but in order to be more sure I would want to see the hourly close below yesterdays lows and even then may only test the overall lows at 1.6261 before it turns. Of which also brings the potential for a long down there with a nice stop run to those lows. The trade that would have the most confluence is the short from the hourly 200 ema at 1.6341 but by the time price gets up there the 200 will probably drop to the 1.6334 level where another significant level is. This would be my preferred trade outside holiday markets.
Forex News Today
High impact news today starts with UK CPI data expected to be flat at 2.2% . Any surprise to the upside will likely have less impact while a drop below 2% will open possibilities for more Asset Purchases if need be. having said that the housing bubble they are blowing over there seems to be working although its going to pop and make things worse reliving the US in 2008. However that could also create a spike on thoughts of higher interest rates and less Asset Purchases so be careful at that time and wait for the release rather than trading any set up before hand.
Later is the German ZEW economic Sentiment figures expected to improve and if it does then it will be a sign the strong Euro isn’t effecting Germany much and since they wont complain the EU may just make higher highs next year. I don’t expect much today unless its a big surprise and then we may see a big move on low liquidity. There is also CPI data from the Euro Zone but I don’t expect much there.
The US CPI data also but with it being held low by how they figure it I doubt there will be much to move markets on barring a large surprise which is doubtful.
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