June 1, 2014 Daily EUR/USD, GBP/USD, Gold Analysis
The EUR/USD finally got a push out of the range to the upside giving me a bias for the next push upward today. The next daily level to test is 14 pips from where our ADR is sitting at 1.3740 so that’s where I will be looking to take profit on a long position today. There is still the smaller chance for the short with a stop run to the highs but I would be more comfortable if they at least attempted to close the inefficient move first.
My preferred entry will be a long from 1.3662 while closing the inefficiency created during the NY news yesterday but if they can dip the Asian lows a bit deeper I will consider them as well. Otherwise if the Asian range stays tight I will want to see them play the breakout traders to the highs first and then catch the long at the Asian lows.
The only way I will consider a short is if they play the breakout traders to the lows and get the stop run to yesterdays highs afterward. At the same time watching for the conviction to exit.
The GBP/USD had the same move showing the larger move due to the weakness of the EUR/GBP. Here I will have the bias for the next push up as well but the best level being at the daily high of 1.7060 being so far away is concerning. Therefore if I do take the long they will have to either show the conviction above yesterdays highs before running to the Asian high/low or form some clean set up at the 80 psyche level and give me a great entry because there is no other confluence there. Otherwise the short from the stop run to the highs is valid as well but it does have a ways to go before it finds the more significant daily levels that have more potential to turn it.
The move on gold yesterday shows they weren’t moving on risk appetite but more so of the USD weakness. This potential Asian fake out did test the next significant daily level that I would expect them to attempt a beat down from but if they cant push it down as more buyers come in then it will more likely hold this range for a day or more before the next break upward. If it does break it has a long way to up before a highly probable turn area so they are more likely to try it here.
Forex News Today
I am going to have to skip the news today in an effort to get it posted before the London session open. Unfortunately we had issues with the site this morning I had to get sorted before I could start which is why its so late. In short there is Mfg. PMI from the Eurozone to watch out for as well as in the US later in the day.
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