May 29, 2014 EUR/USD, GBP/USD, Gold Daily Analysis
At this point the EUR/USD has two intraday pushes to the downside or one long term push. Considering the moves over the past week or so its likely we will get the third intraday push down today. There is also a close beyond a significant daily close from February even though its just a couple pips. I would expect to see more buying at this level toward the end of the day if they intended to hold it and push up from here. We would also see a bottoming formation which is not there on the hourly chart. I am never that impressed when they run intraday pushes but with the lack of conviction to run long term pushes we have to deal with what they give us.
I will be bias for the short expecting the pullback to 1.3613 before the drop. The next daily support level is just above the ADR today right now and if they do pull it to 1.3613 that ADR will rise to just above 1.3561 making for a clean 50+ pip trade with a good entry. Otherwise the Asian highs right now are valid since they also coincide with a proven resistance point from yesterday. Its also the psych level of 1.3600 giving it more confluence. Having said that the current Asian range is a little tight for comfort so I will at least like to see it leave the Asian box at the lows preferably popping the breakout traders and then manipulate at 1.3600 in order to short there.
The GBP/USD making an extended push for well over 100 pips this time shows they are rather convinced that the BOE will not be raising rates any time soon. Moving off like that with literally no manipulation shows that much conviction so we will likely see another push down today. The best level I see for a short is the daily low at 1.6752 where it broke and tested yesterday but there is another just below at 1.6730 that they may turn at if the conviction still holds strong. The next good level to turn for a push up is at 1.6661 so running it up to 1.6752 before a drop will allow for a decent move without having to break those lows.
Gold did make a small push down yesterday but without a decent pullback I was leery of taking it short even though there were a few trapping patterns during the London session. I will be bias for the short here again today. The best level is the range between 1262.26 and 1265.83. If they do show conviction above yesterdays highs then it will most likely get the pullback to one of the upper levels before a potential larger move down.
Forex News Today
The calendar is bare until we get to the US session starting with Thursday Unemployment Claims released at the same time as US GDP figures which will be the one to watch with expectations for a drop below zero. If it does then recession fears will creep in and throw the question of whether the Fed can keep up the taper and the USD should weaken. However as long as it does stay above the USD strength will continue. The bigger the miss the larger the move will be. It will also take a large miss on Unemployment Claims in order to trump a small miss on GDP. Later Pending Home Sales is expecting a drop as well and may have high impact on a miss. My thoughts are with the bar set low a miss to the downside will have more of a larger move but if GDP has a large deviation then it will still be what they move on as long as the housing data is close.
Tomorrows Asian session has a bit of Japan news to watch with CPI and Industrial Production
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