Forex EUR/USD, GBP/USD Daily Market Commentary May 30, 2012
Welcome back to another daily forex commentary.
Today we finally see the drop on the EUR/USD from the range bound market the last several days and have a clear push and 90+ pip run. There are 2 ways we can look at this. Using intraday pushes we have 2 starting from the high of the range for a 160 pip total move over 2 days or we can look at it as the first push down long term and look for the 2nd longer term. Either way we are looking for the short. However the longer term perspective does have the possibility of pushing back into the range. The way I see it considering the break of the psych level of 1.25 we will at least see an effort to test that level. If it makes it I will actually be surprised considering the push during the Asian session but its not impossible. At this point I would be happy to see the attempt and the trap move to short from.
The GBP/USD is showing similar price action and has broken from its range also and showing an intraday 3 pushes down. We did catch this pair in the live trading room yesterday from 1.5711. There was a very nice hourly stop run and trap move during the first hour or so of the London session. However once the market moved off 50 pips I moved my stop to +20 to protect some profit and during the pullback during the US session got hit by less than 2 pips before the run off to my TP at 1.5630. Dont you hate it when that happens? Still a good day but could have been much better. With this pair coming up on daily support the pullback and test is higher but it sure looks like the USD strength is winning the battle. Here we also have the clear first push down and will be looking for the short. I will be happier taking the Euro today but still keeping an eye on the GBP and if its the cleaner entry then all is well.
Forex News Today
The scheduled news releases today are fairly light especially considering how busy tomorrow is. Starting with EZ M3 Money Supply that is expected to have a slight rise. There is also an Italian 10tr bond auction tentatively scheduled and if it dont go well the results will have the largest impact during the London session. Later in the US session ECB Draghi speaks and this should be interesting considering all the rumors flying around about the ECB helping Spanish banks so those that trade the US session should pay attention to that.
The UK has Net Lending to Individuals and two other low impact events. I dont expect too much volatility from these releases.
The US has Pending Home Sales that is expected to be flat with no improvement. A surprise to the upside would be significant and would add to the decoupling theory but I have my doubts it will.
A Funny Thing Happened on the Way to the Facebook IPO
I just couldnt help it and had to post this video of Reggie Middleton regarding Facebooks IPO and how the big boys bent over their clients once again. Will they ever learn? Enjoy
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