Pound Surprises To The Upside – Forex Daily Analysis 4/19/2016
ADR Shrinking For Euro
Today we had less than a 60 pip range on the EUR/USD as we compress into what I term as an inverse trend channel. I do favor downside but as I always mention, bias means nothing without a valid entry. As far as a short term line in the sand the upper level of 1.1330 is a key point. Should we break and hold above this point then we are likely to be retesting the highs at the very least. What that means is our first upper level represents a key point with two trade options. As long as the level holds a stop run short is still valid, and a clean break above it brings in a backside long option. To the downside there is really only one option to consider. The previous weeks lows represents a high liquidity level from which I would be happy to take any stop run reversal long.
Pound Surprises To The Upside
I was a bit torn on the GBP/USD cycle to the upside. Ultimately I have decided to keep the directional bias open given the lack of clarity with the starting point. Anytime I question cycle I always go back to one answer which is go back to trading with an open directional bias. Cycle is only 10% of our trading strategy contrary to popular belief, and therefore there is nothing wrong with dropping bias when you have a reason to question it. Regardless of having a cycle or not having a cycle, the reason we enter the market is because of a stop run of a high probability manipulation point and that alone. Like the EUR/USD I have one upper and one lower manipulation point. The upper level is a pretty significant line in the sand. Should we see a daily close above this level, medium direction may be shifting long. The one lower level we have listed is more of a continuation point if we are going to push higher as we would only be retracing 50% of the previous day’s move if that level was used.
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Forex Market News For April 18th 2016
We have no scheduled data I would look to avoid today. For those of you who looked at Housing Starts and noticed the 15+ pip spikes you have to remember what else is released at that time. Notice how CPI or another major news event is released at the same time? Go back and find the months where it comes out alone and you will have a better reference for its true potential.