Pound Has 2nd Day In Tight Range – Forex Analysis 12/22/15
EUR/USD Breaks 1.0900
In yesterday’s daily FX analysis I talked about the 1.0900 level as being a key short term line in the sand. Today the Euro made a strong push above that point which does support the potential for the short term bearish bias to be fading. The big key will now be what happens as we retest the backside of the breakout point. These areas tend to hold a great deal of liquidity. For all those who went long on a break higher their true belief in their position starts to be tested and therefore many of the weak holders stops will be in this area and slightly below. If you think about those with a short bias, should that level begin to break to the downside then the previous breakout will officially be failing and thus start attracting the selling pressure. This massing of selling pressure represents a great location to buy into retail dumb money if that is the desire. As always, a valid stop run is still required to take any long position according to the rules of the forex bank trading strategy. Additionally I have one other lower manipulation point should the first lower level break as well as one upper level.
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Pound In Super Tight Range
I really have very little to say about the Pound today. Overall the GBP/USD is in the exact same situation as yesterday and therefore the market analysis for the GBP/USD remains the same. At this point, we have one upper and one lower manipulation point I would consider a stop run reversal day trade from.
Forex News For December 22nd 2015
US Final GDP 8:30 AM Eastern: I don’t have a great deal of data for this release. 2 of the releases over the last 3 have deviated from the expected number. One followed through in the direction of the spike and created a nice move and the other created a complete reversal. That is what you call a coin flip. One thing that is for certain is its ability to spike the market more than 15 pips and therefore I would not carry a trade going into the actual release. This month 1.9% is the expected number.
US Existing Home Sales 10:00 AM Eastern: About 4-5 months back we had a spike nearing 20 pips making it a piece of economic news we need to worry about. I think this release provides a little more room for discretion for those that tend to be a bit more aggressive with carrying trades into news. If your sitting at BE or slightly negative then it would not be a good idea to hold into the release as a short term spike along with an increase in spreads could tag you. If you are slightly positive and want to continue holding you don’t have a great deal of risk as even the larger spikes almost always pull back to pre-release with this economic indicator. 5.33 is the expected number this month.