EUR/USD, GBP/USD Daily Analysis August 7, 2013
The EUR/USD has made another push to the upside breaking and closing barely above the 1.3300 level on the daily chart. It is technically a second push from the Monday lows but I expect if there is much conviction in the move there would have been a larger push since the daily range is tightening up. I will have a bias for the next push to the upside today but will also be keeping an open mind with regards to a short. As usual I will need to see a clear set up to disregard the bias for the long.
The best level I see for a stop run to take the long position is 1.3280 and since we are getting a push below 1.3293 right now during the Asian session it has a good chance of widening out the range making the test more probable during the London session. Otherwise if this does hold here and leave the Asian box closer to the highs I will look for them playing the breakout traders to the highs before I consider the long at the Asian lows. If it can manage a larger push during London the next level is 1.3265that it has a good chance to turn.
The GBP/USD was held up by the daily resistance at 1.5393 yesterday looking more now that its going to make the turn for the reversal so I will be open on direction on this pair today. So far with the hourly closes below yesterdays low it seems there is conviction but I always question any conviction moves during the Asian session. If it can push below the 1.5300 during the London session I will be more convinced and have the bias for the short. At that point the best place for the short will be a test of yesterdays lows at 1.5329 or just a little lower at the psych 1.5320. In order to take the long today I want this to hold here and get the trapping around 1.5300. If it can manage to make the push up from here the Asian lows will be a valid place to take the long with the 46 pip range.
Forex News Today
Scheduled releases today start off with the BOE Inflation report from the UK. Since this will be Carneys first it should be interesting to say the least. With UK data improving it should be more about inflation rather than what it has been of late being considered the “UK economy in the tank” report.
The Euro Zone has German Industrial Production that has a decent chance of a surprise upward with Factory orders having a big miss upwards yesterday.
The US has a 10yr note auction that will most likely go well as usual but should be watched anyway just in case it don’t. Later Bernanke has a speech but I cant find any information on if he will be answering questions.
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