Key Support Approaches For GBP/USD – FX Trading Commentary 3/15/16
Key Support For EUR/USD
The EUR/USD is approaching the first major firewall support after the huge surge up last week. One of the things I talked about in the members daily market preview video was the fact that our one and only lower manipulation point is also a good level from which to take a backside short should it break. Overall I think this is a key line in the sand from the short term perspective and a point worth watching today. To put it simply if this level doesn’t hold then its hard to remain short term bullish, and if it does then I think upside is your higher probability. As far as upper levels go we really don’t have much to consider. As you can see in the EUR/USD chart below, I only have one upper manipulation point from which I would look to see a stop run short. This leaves us with a great deal of room for a new level to form.
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Major Line In The Sand For Pound
The GBP/USD is approaching a short term line in the sand as well, although it is not quite as precise of a level. To the downside the 1.4260 area has seen quite a bit of action over the last 2 months. If the GBP/USD is going to push higher then this is the point I think it will need to defend. This level is our first lower manipulation point, and like the lower level on the EUR/USD I would also consider a backside short if we were to break through it. The only other lower level on the chart is quite a distance beyond the ADR and therefore we are unlikely to touch it. To the upside our upper point is also unlikely to be hit given its distance from the current price. Like the EUR/USD this presents an opportunity for new level creation to the upside.
Forex Market News For March 15th 2016
US PPI & Retail Sales 8:30 AM Eastern: Both PPI and Retail Sales have the ability to spike the market. As far as continued follow through in the direction of the spike, the key point to look for will be any conflict in the numbers. If PPI and Retails Sales conflict in their deviation then a reversal of the spike becomes more likely. What amplifies the possability of a reversal in that situation is if the spike was large….around 20 pips or more. A large spike and a conflict is a recipe for a reversal of the initial move. When they both deviate in the same direction that is obviously your highest probability for continued movement in the direction of the release. For this month, PPI is expected at -.1% and Retail Sales is expected at -.1%