CompassFX Webinar with Greg Michalowski Thursday 4:00PM
CompassFX is having a special webinar with Greg Michalowski this Thursday 4:00PM
EURUSD breaks lower….
The EURUSD has moved below the 100 hour MA and trendline support (at 1.4593 currently). Staying below this level (up to 1.4597 stop) now is the risk. ON the downside, the support at the 1.4553 (38.2% of the last major move higher – see chart above). The low from Monday came in at 1.4556. On the 5 minute chart below, the price decline has extended below a low trendline at the 1.4583 level.
EURUSD on a bumpy ride as news releases increase anxiety/fear
This morning there were no major economic releases in the US. However, there has been a number of news releases that have increased risk, anxiety, fear and volatility for the EURUSD.
For one, there were first reports of an OPEC agreement but that was shortly reversed with comments of a breakdown from OPEC. Next, there were comments that there were major obstacles with regard to a Greece accord. This was shortly followed by comments that Fitch would downgrade the US debt rating if the debt ceiling could not be passed by August 2nd.
Each news headline moved the EURUSD in opposite directions. The traders patience has been tested to the limit today. I think it is safe to say as well that anxiety and fear is increased – even though the range is relatively narrow (4 hour low of 1.4598, 4 hour high of 1.4638),
What to do now? From a technical perspective the EURUSD has a bearish bias. The price moved below the 1.4630 level and despite a move above that level during the news headlines, the move above was short lived. Looking at the chart earlier in the day, the price move above the 1.4654 level shows failure to extend above. This has added to the days bearish bias.
ON the downside, the price does have good support against the 100 hour MA and trendline support at the 1.4591 level. At the days lows, it got within 11 pips of the two key levels, but found early buyers.
The fate for the rest of the day may be subject to more headlines, but it also should be subject to the technical clues. Look for dips against the 100 hour MA/trendline to find buyers on the downside and for the 1.4630 and the 1l4654 level to provide resistance. Moves outside the range are more likely to be false breaks given the market’s jitters. Moves that don’t hit the targets could cause traders to give up – thus increasing the volatility. It is turning out to be one of those days. Be on alert.
Fitch expresses there are rating implication of a failure to raise US debt ceiling
Needs to be done by August 2nd debt ceiling drop dead date.
They add the US default would threaten US world financial stability.
The US is on rating watch negative. States would not initially be affected.
The news barrage continues for the market, with this being negative US.
Accord on Greece bailout faces major obstacles
This sends the EURUSD back down in the news filled day.
Today has had it’s share of market moving news. There was talk of a OPEC agreement, then a breakdown. Now the Greece bailout talk in the market has riled the market again.
Traders face market risk, event risk and liquidity risk. Some event risk is known. Some is not, like what we have seen today.
Oil price move above $101 on OPEC breakdown
Saudi minister says “It is one of the worst meetings they have ever had”.
The implications are not good for global growth/inflation should oil continue higher. The Eurozone is concerned about inflation. The US is concerned about growth. The EURUSD is more bid since the report with the price back above the 1.4630 level and within the 1.4630 to 1.4655 resistance area.
CompassFX Webinar with Greg Michalowski Thursday 4:00PM
CompassFX is having a special webinar with Greg Michalowski this Thursday 4:00PM
The USDCAD moves to resistance at 0.9815 and backs off as OPEC eyed
There are conflicting reports coming from newswires on OPEC. Initiallly there were reports of an OPEC agreement. Now there is a report of no concensus on an agreement. As a result, the price of oil is likely to remain volatile.
The CAD$ is influenced by the price of oil. The USDCAD tested the high resistance area at the 0.9814 level when word of an agreement circulated. Now the price is down on the “break down of talk” comments. Typically, oil price up, the USDCAD down/CAD dollar higher. Oil price down, USDCAD up/CAD dollar down. Below support at the 100 hour MA and 38.2% retracement at the 0.9775 area.
OPEC delegate: OPEC likely to approve output
Saudi Arabia wants oil prices at $80 per barrel
EU’s Barroso Speaks in Brussels
Says:
- Euro area to do whatever needed to assure stability
- Inclusion of aviation in ETS is now EU law
- EU not thinking of changing aviation-CO2 law
- Global action needed to combat climate change
GBPUSD tests its trendline support
The GBPUSD is testing the trendline support at the 1.6353 level. A break below targets the 1.6323 level and then the 1.6284. Above the 100 hour MA has contained the topside and keeps the pressure on the pair.
EURUSD looks to test the 100 hour MA/trendline at 1.4587
The EURUSD is looking toward the key support against the 1.4587 level where the 100 hour MA and the trendline off the low at May 26th. I would expect buyers against the level on the first test.
ECB Draghi need for highest level of credibility on price stability
His comments are reminder of the ECB meeting on THursday. The central bank is expected to keep rates unchanged. However, it will be what ECB’s Trichet says at his usual 8:30 AM ET press conference. The ECB is still focused on inflation. We know about the headwinds countries like Greece, Portugal, and Spain are facing. In Germnay today, they had weaker export and import numbers than expected. However, yesterday the Factory Orders showed stronger growth. How does Trichet see the economy? His comments will be the focus over the next few days.
Canada Housing Starts Slightly Better
Housing Starts: Survey: 182.0K Actual: 183.60K Prior: 179.0K Revised: 178.7K
May vs April
3-Month Avg: 183.6 vs 178.7
Urban Areas: 182.333 vs 182.367
Single Family: 161 vs 159.8
Multi Family: 61 vs 63.6
Rural Areas: 22.6 vs 18.9
Atlantic: 8.1 vs 7.3
Quebec: 42.0 vs 37.0
Ontario: 50.2 vs 65.1
Prairie: 30.7 vs 27.9
British Columbia: 30.0 vs 22.5
The NY Morning Forex Commentary for June 8th
- kenny on EURUSD tests 200 hour MA. Look for support against level
- Greg Michalowski on EURUSD tests 200 hour MA. Look for support against level
- kenny on EURUSD tests 200 hour MA. Look for support against level
- Greg Michalowski on EURUSD tests 200 hour MA. Look for support against level
- kenny on EURUSD tests 200 hour MA. Look for support against level
- Jan SFO
- Wall Street Journal 1-31-12
- CNNMoney 1-30-12
- Reuters 1-24-12
- CNNMoney_Stocks to get boost from China
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