First Real Wave Of US Dollar Weakness – 2/8/16 Forex Daily Forecast
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Big EUR/USD Stop Run Of Previous Highs
From a longer term perspective we have some mixed signals on the EUR/USD. Looking at the Euro COT data we can see some buying pressure coming it. This however does not include the price action that followed Non-Farm Payroll. Friday we had a major stop run of the previous highs which was followed by continued aggressive selling pressure. This gives me more of a short term bias to the downside, but ultimately I would not be surprised if later in the week we pushed up higher. As always my opinion is not a reason to take a trade and we always need to see a stop run of a high probability manipulation point before entering a position. For today I do not have a lower manipulation point from which I would consider a trade. The fact is, through early last weeks move to the upside, we had very few stopping points which leaves us with limited options. We do however have 2 upper manipulation points from which I would consider a stop run short as you can see in the chart below.
Pound Slides South On Mixed NFP Data
Looking at the GBP/USD, the 1.4600 level is a very significant point for me. If your looking at your daily chart this level is quite substantial in regards to being the yearly lows for 2015. Last week we retested the backside of the 2015 lows and this does lend itself to further downside being likely. Should we see an aggressive daily close above this level then the reverse becomes true, and further upside on the short term becomes the likely outcome. From a short term perspective I do not have a market cycle bias to start the week. Often I like to start the week with only wider/stronger manipulation points and trade with an open directional bias. I wish we had better upper manipulation points for a potential short, but I only have one upper point which is the previous weeks high. This level is quite a distance away and we are unlikely to see it hit. As far as a lower level we have 1 point listed I would consider a stop run long from as you can see in the chart below.
Forex News For February 8th 2016
For today we do not have any listed economic data that is worth mentioning.