Forex Analysis

EUR/USD paused yesterday after the huge sell off Tuesday. On the candlesticks charts a hammer pattern apperad which means that further correction of the downside move could be expected. Today the forex market will watch closely the US GDP report (12:30 GMT). If we see a positive number the chances for recession in US will diminish and some market players could price in this fact. Tomorrow the mother of all reports - US NON-Farm Payrolls is expected to show -75K. ADP report suggest a positive surprise risk and if the number comse out above -50 the US dollar could find some support aiagin. Resistance is 1.5630/50, 1.5720 and 1.5770. Support is 1.5520 and 1.5455.

This is the chart of EUR/USD in the previous election year 2004. The price action looks similar to this year’s. Consolidation from the mid-Spring to mid-Autumn then breakout of the range. Previous elections had Republican winner but this time may be different. Could we see different direction of the break out? I think we can.

Huuuge sell off in EUR/USD yesterday. Two big figures is a serious daily range for this currency pair. The reasoning of the yesterday’s dollar strength is unclear but probably the strong US stock market and weaker oil were the main drivers. The move was accelerated by the large long euro positions unwinding. The sentiment is bullish for the US dollar across the board. The best strategy is sell the rallies in EUR/USD. Resistance is @ 1.5630 then 1.5735/65. Support is @ 1.5550/35 then 1.5460.

Choppy price action Friday. The Euro was lifted buy buy profit taking in the European morning and then was sold off after the much better than expected Durable goods orders numbers. Funds and sovereigns offers are capping the market @ 1.5730/40, but the US banks woes may weigh on dollar. While EUR/USD is below 1.5785 the best strategy is to sell the rallies. Above this level the 50% retracement @ 1.5830 is the next resistance and if the market climbs above we may see another life time high. Anyway, the focus is on the downside for now and if we break below Friday’s low 1.5660 a test of 1.5610 will follow and probably another leg lower towards 1.5540 and 1.5460.

The forex market is in a correction mode today. Economic data were dissapointing for EUR and USD and probably this is the reason for some profit taking. The sentiment is bullish for the dollar in the last few days and large players are selling the rallies. Strong offers currently cap the upmove near 1.5730. Resistance is in the 1.5760/80 zone and then 1.5830 and 1.5885. Support is 1.5610 and 1.5535.

EUR/USD was under selling pressure again yesterday and reached the 1.5680/70 support level. Today may be very important day. Ifo numbers are relesed @ 8:00 GMT. Market is expecting 100.5 and if we see reading below 100 Euro bears will have another good reason to sell. Next support is @ 1.5610 and 1.5540. Resistance is @ 1.5760 and 1.5880.

The last 1/3 of the position was stopped @ 169.82

The last 1/3 of our previous position was stopped. We opened another short position near the recent life time high. We closed 2/3 of the position @ 169.72 for 22 pips profit and placed a stop @ 169.93 for the last 1/3.

Yesterday the US Dollar was in demand against all major currencies. Weaker oil and hawkish comments form FED were the main drivers of the move. EUR/USD broke and closed below the uptrend line from mid June and the downside is favored now. Support is @ 1.5750/40 and 1.5680. Resistance is @ 1.5875 and 1.5945.

Our stop survived for a few pips. On the chart the support @ 169.00 is obvious and if the market breaks below next target is 168.20. Ours limit is @ 168.30.