Eur usd 3rd/4th august

Trading Discussion Currencies
1

]heavily short eur usd all the way up starting from 1.232 (large) to 1.238 (small due to account balance). Hoping that I haven’t made a mistake… As far as I see it:

Bearish considertions:

1 draghi said nothing at last press conference, “may buy bonds if governments continue austerity” surely means that QE on the euro could happen soon and if it does this devalues the euro, however nothing happening now so unlikely to change the bond yields and increase growth in euro zone until it does hence euro will remain weak.

2 US jobs increase to 163k suggests recovering economy which is strong for the dollar and suggests delayed/not happening Fed QE til at least Q4

3 Spanish and Italian short term yields are improving considering that draghi suggested buying short term bonds but this is temporary since the countries are still heavily indebted and showing recessionary data.

4 downward weekly trend on euro

5 flight from safe havens to risk on assets like gold/stocks/oil should cease once US data is fully analysed and the increasing unemployment to 8.3% takes
preference and reduce market sentiment

6 Greece had to have its loan allowance increased on Thursday

Bullish considerations:

1 daily and hourly technicals (EMAs 13 day) point up

2 potential for QE by the Fed if unemployment % continues to increase however strong jobs report decreases likelihood of fed using QE bullet

3 markets could continue to feel euro optimism due to decreasing Italian and Spanish short term bond yields, and any ecb efsm monetary stimulus could empower peripheral economies so increasing euro strength

4 Greece has accepted a new loan and increased loan allowance to tide it over until next bond sale/ troika meeting

5 risk on trading could continue on the basis of the above so devaluing the safe haven dollar

6 no immediate qe by ecb which would require printing more euros devaluing them and as a result the euro may stay strong

7 unemployment increase in us jobs report suggests us jobs increase could be a blip and may be revised down as the June data was (down to 64k I think from about 90k or so)

Conclusions:

Overall suggests to me a bearish Monday 6th with an immediate retreat from Friday’s high and hopefully will push down through 1.23.

My account needs this to happen before a push through 1.245

Any thoughts on my analysis for Monday trading would be GREATLY appreciated, I’m sure you are all much more experienced in forex trading than I am!

Thank you.

2

First word should read ‘heavily’ as in ‘heavily short eurusd’ rather than ‘easily’. Think i have managed to update it. Hate autocorrect sometimes! Please let me know if you think we are in a strong bull markets or even if you think that I am right to be IMMEDIATELY bearish on Monday trading

3

Hi Igjmac

First of all I probably should say that I am no expert by any stretch of the imagination. I base my trading decisions on technical analysis and my analysis supports your BEARISH view.

There is a significant level of support resistance at about 1.2410 that I am waiting to see if this break through or not on Monday. If the market turns south on Monday I will sell. If the market breaks through this level at about 1.2410 the next level is at about 1.27

I am going to play wait and see on Monday to see what happens with the resistance at 1.2410

4

I also agree the market looks to be swinging back to a BEARISH direction. Igjmac can i ask where or which sites you get your funadmental analysis so i can cross referance.

Many Thanks

5

Hi yes I use

6

Hi yes i use a mixture for fundamental analysis and tend not to rely too heavily on individual sites. I use forexpros economic calendar since it seems to update the quickest when new data appears. I use fxempire.com for their daily technical analysis videos to see if it concurs with my view. I use MACD, EMAs and a very fast stochastic 5,3,3 for detecting changes in trend. I am in the process of adding more indicators but I think it is better to know a few indicators well than lots badly.

For fundamental news i listen to Bloomberg radio and watch Bloomberg tv as often as I can which is usually daily I love Bloomberg surveillance and Betty in the loop. I’m a bit in love with Betty Liu! I get the FT delivered to my kindle every day but to be honest newspapers are a slow way of getting info i find. I am on twitter @lgjmaclachlan and I’m adding follows who seems to give good insights. I’m new to baby pips but have heard good things about it.

I would appreciate more views on Monday’s trading from ppl if possible, and backed up of course with reasons, please post

Best wishes

7

Thank you for your reply! I would also like to see someone comment for their view on tomorrows markets.