EU Analysis:
MONTH- The candle is a below average spread (245pips) bull closing near the high on low vol<1month. The candle close suggests more upside.
WEEK- The candle is an above average spread (213pips) bull closing just off the high on low vol>1week. The candle close and volume suggests more upside.
DAY- The candle is a small spread (52pips) bear pseudo "upthrust" closing on average vol<5days. The candle close suggests more downside.
Background: FED's members still insist the "appropriateness" of rate hikes but the recent FOMC Statement have revealed some differences of views. In any case, it will likely be limited to one more for the year in light of the forthcoming US Presidential Election and uncertainty for the world economy post-Brexit. The continued uncertainty in Turkey with the latest bomb blast at a wedding celebration and the terrorism situation in France and Germany give rise to a risk aversion climate which is already keeping the US Dollar relatively strong regardless of any pending rate hike by the FED. In this situation, raising rates may be counter-productive and this is what the FED will need to contend with.
Oanda order book: Volumes are thin with more trapped shorts but also profitable shorts from 1.1330.
Apparently now 8 FED members are for a rate hike if US jobs data continues to improve. This has created US Dollar strength after the recent weakness. SM is likely to push to test 1.1280 or lower before reversing. Without orders there is no reason to keep dropping unless there is a news/data push.
EU short levels: 1.1350, 1.1365-1.1371, 1.1422, 1.1452, 1.1496-1.1500, 1.1518-1.1528, 1.1592, 1.1600, 1.1615-1.1620, 1.1711Apparently now 8 FED members are for a rate hike if US jobs data continues to improve. This has created US Dollar strength after the recent weakness. SM is likely to push to test 1.1280 or lower before reversing. Without orders there is no reason to keep dropping unless there is a news/data push.
EU long levels: 1.1270, 1.1250, 1.1200, 1.1185, 1.1150, 1.1130, 1.1118, 1.1108, 1.1100, 1.1045, 1.0950, 1.0938, 1.0911
GU Analysis:
MONTH- The candle is a below average spread (685pips) bear "spring" closing on very high vol<1month. The candle close and volume suggests absorption of selling.
WEEK- The candle is a below average spread (319pips) bull closing on low vol>2weeks. The candle close and volume suggests more upside.
DAY- The candle is a below average spread (81pips) bull closing near the high on average vol>1day. The candle close and volume suggests more upside.
DAY- The candle is a below average spread (81pips) bull closing near the high on average vol>1day. The candle close and volume suggests more upside.
Demand: Weekly/Daily: not applicable after 31 year low was broken through. Supply: Short term: 1.5574, 1.5600, 1.5619
The Oanda order book: Volumes are very thin with newly profitable longs from around 1.3020
Prices continued pushing north again as expected and also expected is the retrace movement. Medium impact UK mortgage approvals data will be the catalyst today. I don't suggest longs on GU because of extreme volatility. The emphasis is to continue to look for short positions.
GU long levels: 1.3150 (not a real demand level)
Posted at 3.01 am EST
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