EUR/USD, GBP/USD Analysis September 26th 2013
Yesterdays price action on the EUR/USD gave us a first clear push to the upside after the four weak pushes down. With the way the S&P chopped around and closed on its lows it makes me think the issues with the US debt ceiling are coming to the forefront again and we might get a more normal type of market for a couple weeks anyway. At least until this blows over and they raise the debt limit like we all know they will. As you will see in the Rick Santelli video below the credit rating agencies are covering their butts saying it wont effect the US in the short term. Interesting stuff but we have yet to hear from the other two big ones.
Since we have a first push I will have a small bias for the next push long but will still be open for the short as there is still potential this is a false push before a bigger drop. As long as this 1.3515 area can hold during Asia and make an attempt at the highs I will look for the stop run to the Asian lows for the long today during the live London training session. With the average daily range at a tight 80 pips I will make an exception on wanting to see the wider Asian range as long as the trap is clear. I will consider a short from a stop run to the highs yesterday but only if I am not long already and it gives me good reason to change my bias.
The GBP/USD made the reversal as Sterling expected and we did discuss the possibility of that but it did seem clearer to me at the time that we would see the next push down. Now we have the first push up with some conviction at the end of the US session making a few hourly closes above the recent highs. Here I will have the bias for the long also but cautious of the potential this is a false push. The best level I see for the long is at 1.6062 and its looking like it will leave the Asian box close to the highs so it would be nice to see them play the break out traders there and then I will consider the Asian lows for the long also. There is the slight possibility for the short but as with the Euro it will need to be rather clear in order to change my bias for the long.
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Forex News Today
The calendar is light during the London session today with only UK GDP figures. Expectations are for flat figures and no change so barring a big miss I doubt there will be much but an opportunity for the big boys to manipulate on a smaller miss. The funny thing is as with most of the western world its just outside of the margin of error as to whether or not there is any growth at all.
The US later has weekly unemployment data expected to jump a bit so a small miss upward probably wont do much while a miss to the downside may create some USD strength but I have my doubts. Later is US GDP figures also and expecting a small rise from 2.5 to 2.6% on a quarterly basis. With the Fed stuck between a rock and a hard place a miss will need to be big to the upside to created any true taper effects. We also have the Fed members starting up with speeches again today so watch out for those later in the day. It seems like the last few have been taken with a grain of salt and not caused much commotion but we never want to assume we know what they are doing 😉
Enjoy the Rick Santelli video I mentioned above. We already know politicians will say anything to get elected and do the exact opposite when they get in office but I thought this was worth sharing.
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