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EURGBP moves below last weeks lows

By | July 5, 2012 12:17 pm | 0 Comments

The market could not care less about the BOE rise in QE and instead took it’s clue from the ECB rate cut. The move has taken the price below the lows from last week at 0.7983 and 0.79846 respectively.  Next support targets come from May lows that came in at 0.7977, 0.79698 and 0.7948

EURUSD moves lower after rate cuts

By | 11:51 am | 0 Comments

The ECB cut the benchmark interest rate to a record low of 0.75%. They also cut the deposit rate  to 0% from 0.25%.  This EURUSD has moved below channel trend line support after  the announcement (at  the 1.2485 area).  Traders will be eyeing this level as resistance now (Resistance up to 1.2493 will still keep the bears in control).  A move above 1.2493 would not be welcomed by the shorts today.

There is some support at 1.24519 and below that 1.2440 which is trendline support from the daily chart (see chart below). A break of that and the low from last week came in at 1.2406 and would be the next level to go for by the sellers. 

Stimulus day. BOE raises QE. PBOC cuts by 31 basis points. ECB next

By | 11:40 am | 0 Comments

The BOE increased their QE  by 50 billion pounds to 375 billion. The PBOC in a surprise move, cut their 1 year lending rate by 31 basis points to 6% from 6.31%

The ECB is on tap next with most expecting a 25 basis point to 0.75% from 1%. It would be the first cut since November 2011.   

The EURUSD has been trading below the 200 hour MA for the entire trading day in a very narrow trading range (again) of 46 pips (20 day average of 123 pips).  The 200 hour MA (green line in the chart)  comes in at the 1.2536 level. A move above this should lead to further upside momentum. 

On the downside, the bottom channel trend line comes in at 1.24856.

The market will decide from the decision.  Look for the momentum in the direction of the break of these extremes.

EURAUD hits channel support. Is it enough to slow the trend?

By | July 4, 2012 3:57 pm | 0 Comments

Is it time to take profit in EURAUD?  The hourly chart hit the bottom channel trend line and seems to have found some willing buyers/profit taking against the defined risk. On the daily, the all time low reached in February bottomed at 1.2130 (low today reached 1.21684).   If buying, I would not risk more than a new low as a break will likely look to attack the all time low one more time. 

Where would buyers feel more comfortable (you are trading against the trend after all)?  Move above the 1.2188 and longs can manage the correction better. This would take the price back into the intraday channel (i.e. failed break lower) and also above the 38.2%-50% Correction Zone of the last leg down. 

EURUSD triggers stops below the 200 hour MA

By | 2:46 pm | 0 Comments

The EURUSD is triggering stops below the 200 hour MA at the 1.2538 level and looks next toward the 1.2515 (see 61.8% in the chart above).  Traders will now look for the 1.25488 as topside resistance (50% of the move up).  Staying below the 200 hour MA and shorts/sellers really feeling good (that level comes in at 1.2538).

Overall, it is better action than I thought today. 

PS. The EURJPY also triggered stops below the 100 hour MA at 100.143 and EURGBP also moved lower.

EURJPY tests support. Finds buyers.

By | 2:33 pm | 0 Comments

The 38.2% of the move up from last weeks lows comes in at 100.207.

The 100 hour MA comes in at 100.143.

This is support for the pair and I would expect buyers against the level with stops below (100.143).  A move above the 100.49 level (high from London session) would be needed to give the buyers more upside momentum.

GBPUSD catches up to the EURUSD

By | 1:52 pm | 0 Comments

 

In a prior post I commented that the EURUSD and the GBPUSD were the same but different. The diffence was the GBPUSD was testing the 38.2% retracement of the move up from last weeks lows, while the EURUSD was testing the 38.2% retracement of the similar move higher.

That dynamic changed on the breaking of the 38.2% level at 1.56303. On that break, the price fell sharply, finding support at the 50% level (low reached 1.56039 vs 1.56023 for the 50% retracement level).  The GBPUSD had caught up to the EURUSD (at least from this perspective).

In the process, the price has also broken below the 200 hour MA (green line in the chart above) at the  1.56167 level (currently). Staying below would certainly be bearish but be warned that a move back toward 1.56266-1.56335 cannot be ruled out (38.2% -50% of the last leg down).  Staying below this area would also keep the bearish bias  for the days trading.  A move above, and I would expect more of a balanced trading between the buyers and the sellers.

AUDUSD is back above the 100 and 200 day MAs

By | 1:34 pm | 0 Comments

The 200 day MA (green line) is at 1.02539.

The 100 day MA (blue line) is at 1.02596

When the 100 and 200 bar moving averages converge with the price, I will look for the price  to move away (I call this Three’s a Crowd. The price is the third wheel that has to move away/leave). 

The low today came in at 1.0260. So the bulls are winning the battle on the break higher today as traders used the level to define risk and buy.  Stay above and the price should continue the move to the upside, with the next target at 1.0367. This level represents the 61.8% retracement of the of the 2012 trading range (see chart above).  

If the price, should instead find sellers and fail on the break above, look for stops and a move below the years midpoint at the 1.0216 level. This would be a signal that a top is in place – for now at least – and I would expect further selling pressure..

Looking at the hourly chart, although the market is bullish by virtue of the ability to stay above the key MAs on the daily chart, the failure on the break above channel resistance that could give traders a reason to pause (see chart below). If the price should move back below the key MAs at 1.0253-59, traders might consider that failure to be more significant than it is now. Until then, however, I still have to give the nod to the bulls. 

USDCAD keeps above the 200 day MA / 50% retracement in quiet trade

By | 1:06 pm | 0 Comments

The 200 day MA (green line  in the chart above) is at 1.0116.  The 50% is the 1.01215.  The low is 1.01177.  I don’t know if the price breaks this key support will there be the expected stops of such a key level.  However traders should be aware that the holiday trade and such key support can cause some fireworks on a break.  Be aware.  Currently, however,  the price is holding the line nicely in a very narrow trading range (24 pips low to high).   

Looking at the intraday chart, the price has resistance at the 1.0130 area. The midpoint of the days range is 1.0129. A move above and shorts/buyers may look to rotate the action more to the upside. With the range so narrow, it would not be out of the realm of possibilities for it to be extended – despite the holiday trade – but then again….how far can it go?  The 1.0150 and 1.0160 (midpoint of the weeks range) is the next upside targets.

GBPUSD similar to the EURUSD but different…

By | 12:45 pm | 0 Comments

Like the EURUSD, the price in the GBPUSD has fallen below the 100 hour MA (at 1.56427 currently – resistance now) but instead of targeting the 50% retracement of the move higher, it is testing the 38.2% of the move up from last weeks low.  That level comes in at 1.56303.   A move below will look toward the 200 hour MA at 1.5616 currently. 

The PMI Serice in the UK came out weaker today at 51.3 vs 52.9 expected (lower than last month at 53.3), but unlike the the German PMI, was still above the 50 level.   The market price bottomed just before the release this morning, but rebounded after the event.   The correction off that low, corrected toward the 50% level and started the move back lower (see 5 minute chart below). 

The topside trend line off that chart comes in at 1.5644. The 38.2% and 100 bar MA is at the 1.5653 area.  These too are topside resistance for the pair in the trade today. Stay below and the price continues the drift lower.

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