EURUSD seems stuck in a real rut. (but the longer it stays there maybe the bigger the eventual breakout).
The daily candles are quite interesting in a dull kind of way.
This chart shows how little movement we have seen during October so far.
Last week saw both the low put in for the month so far - which happened to end up the same day as a very bullish looking pin bar/doji - and the high for week on Friday after several up days - but ended very weak at the close!
Yesterday saw an inside day with a non-spectacular close at about mid-range for the day and today is so far a small doji sitting right on where we closed yesterday…I am not sure that I have ever seen such a neutral market before…
She also has to retain the votes of the “Bremainers” in her own party and also the “Brexiters” in her own party.
Her task is indeed onerous - the more so since her judgement has to date been shown to be pretty disastrous - I cite the “snap election” she called to capitalise on what she perceived as Labour weakness, which damn near gave away control of the country to Corbyn !
It was out of that - that she had to go “cap in hand” to the DUP who extracted a very costly monetary bribe from her in order to agree to “Play ball”.
Now the Irish are once again grabbing the headlines with this perceived “Border problem”. Whether that is a “real issue” or just a manufactured excuse for the “Remainers” to try to derail the process, I am unsure at the moment.
It is perhaps worthy of note here, to remember that Eire (Southern Ireland) did in fact vote AGAINST joining the “Euro” a few years back, but since they “Got it wrong” - they were sent away to “Vote again” - one of the standard tactics of the EU it seems.
You are right though - A simple vote to “exit” has been mauled about and devalued by those with a biased agenda (Including the BBC) to such an extent that it now is dubious as to whether any “agreed exit” can really be an Exit at all !
My own view is well - known and clear - Just get the hell out ! And await those “Green shoots of Spring” which you referred to so neatly a few posts back.
As to what short-term effect all of this is to have on the values of the Euro and GBP, one can only speculate - but hey "That is what we do " !
Yes, I agree, there seems still a long way to go even after the EU/UK have reached some kind of agreement.
I think this week is going to see plenty of comments. Here is the first I’ve seen from Reuters:
"LUXEMBOURG (Reuters) - The European Union and Britain will work “calmly and seriously” in the next weeks to reach a deal on Britain’s withdrawal from the bloc without creating a hard border between Ireland and Northern Ireland, the EU’s chief negotiator Michel Barnier said.
The European Union’s Brexit negotiator, Michel Barnier is welcomed by European Council President Donald Tusk prior to a meeting in Brussels, Belgium, October 16, 2018. Olivier Hoslet/Pool via Reuters Speaking to journalists before briefing EU ministers at a meeting in Luxembourg, Barnier said the withdrawal agreement with Britain had to be “orderly for everyone and all the subjects, including Ireland.”
“We will take this time, calmly and seriously, to reach this overall accord in the next weeks,” Barnier said. “We need more time to find this deal … and to reach this decisive progress.”
Leaders of the 27 European Union countries that will remain in the bloc after Britain leaves in March 2019, will discuss progress in the negotiations on Wednesday evening."
So not likely to see any deals this week according to Mr Barnier…
I am beginning to think that the forex majors are becoming more and more uncertain about where we are going. The fundamentals are becoming so uncertain, especially from the GBP and USD perspectives that there is no clear scenario.
Apart from Brexit and the GBP, we also have the impact of the huge intercontinental trade wars that have started and still developing, the current intensity of focus on environmental issues that could cost fortunes globally to deal with, the impact on oil demand/supply equations, the divergent comments from the US President and the Federal Reserve on dollar interest rates and currency value and the Middle East tensions.
It is no wonder that currency movements are erratic or numbed into a neutral trance. We have seen how markets go quiet on, for example, major US holidays. These show how much short term movements are primarily driven by speculative interests which are not there on these holidays. It seems we are seeing a similar phenomenon in general where the speculative elements cannot form a view worth trading…
We are becoming very much driven by technicals. Look at this little blip on EURUSD just now - a break of the 200 EMA and a quick move up to the 200 SMA and straight back down again! OK so it was another 20 pips in the bank, but this is very - hard - work!!!
Seems there is little new on the Brexit front. Theresa May is meeting with the EU later today over a very important working dinner and the original hope was that a deal would have resulted at this time which could be sealed in a November summit meeting.
But the UK govt position is that their proposal is defined and clear - Donald Rusk says that the EU wants more concrete proposals. Neither the UK nor the EU are expecting much progress today, if any at all…
Meanwhile the Euro remains ranging and somewhat directionless against most currencies. The EURUSD further confirms its lacklustre drifting with a negative pin bar yesterday countering the positive pin bar from last week. There was an anticipated drift off in Asia this morning to the downside but so far has only managed to bring us back to the closing level of last Friday. So here we are, mid-week, and sitting right where we closed last Friday.
This really is the tease with trading. As I have said many times, I am really looking to migrate to more longer term trading but if I was long last Friday I would be sitting here with nothing to show and three days of "worrying " about an open position. But my intraday trading for this week so far has just passed the 100 pip mark including one scratched trade for a loss of -2 pips. So this EURUSD daily chart is not giving me any spasms of joy right now!!
Overall though, one could notice that we seem to be meeting a lot of resistance (read: new selling coming in/short-term profit taking) whenever we get to around the 1.1600 zone. So although the picture is very flat and neutral, I suspect we could see some lower levels today based on some follow-through sentiment from that down pin bar from yesterday. But i only have a negative tinge on my shortest timeframes of 1H and less. The daily/4H is neutral on my charts:
Republic of Ireland joined the ERM in 1978 and broke the link with Gbp in 1979.
Then joined the EZ in 1979 since it’s currency was fixed to the Euro value. Jan 2002 Euro became legal tender.
The vote you are referring to was much later and on the adoption of the Lisbon Treaty. That treaty was changed and became acceptable to Irish electorate on a second vote - democracy in action.
The difficulty surrounding the land border between UK and EU is incorrectly being described as the “Irish”.
Ireland’s position is that it is the UK leaving EU, not Ireland.
The DUP do not see themselves as either Irish or Irish based, they view themselves as British and UK based. This is why they refused to accept the PM’s very first attempt to sign a “backstop” statement of intent last year.
To get a sense of the difficulty facing the negotiations re EU/UK border check press readings on Dec 5th 2017 - the PM had to pull out of a signing ceremony after lunch and go home from Brussels with nothing.
The fact that it is the UK leaving the EU does not mean that this is not also a problem for the Irish Republic. The reason for calling it an Irish problem is purely a geographic term rather than political or national.
The problem is how to establish and, more importantly, manage, control and monitor a brand-new border between the EU and UK, as from 29th March next year, which happens to straddle a land mass, Ireland, which is divided between the Irish Republic and the British Northern Ireland.
This border exists already and is crossed daily without hindrance or physical controls by many people and goods whilst the UK is still part of the EU. Nobody wants to replace this with a hard border across Ireland but the UK, as I understand it, does not want a border “somewhere in the Irish Sea” either.
In this sense I see this issue as an overall “Irish” problem as it is just as important and problematic to the local inhabitants and nations on both sides of this border as it is to the EU and UK as a whole.
Talking of Northern Ireland and the Irish Republic, both have had their own series of bank notes and many of them really attractive:
Northern Ireland Pounds sterling - this series features a distillery on the reverse side and as far as I know is the only banknote series in the world featuring a brewery or distillery. (There are other notes with public houses/restaurants)
And the last Irish Republic One Irish Pound paper note (1976-93) (pre-Euro) featuring Queen Maeve of Connacht, a queen warrior in ancient Celtic mythology or folk lore:
Well we got a break below Friday’s close as expected, but will we see any follow-though here towards the low of last week or back into the earlier range? I took my first chunk here with my core approach based on the “10 pips with 10 lots is easier than 100 pips with 1 lot” philosophy…but maybe I gonna miss out on a sudden drop? Well let’s see where we go from here…RSI’s have turned down as well now…
The currency notes in NI can be confusing largely because there are so many different banks’ circulating notes - Bank of Ireland, Ulster Bank, First Trust Bank and Northern Bank.
Into that mix add the standard Bank of England and less often Bank of Scotland notes - every note different in colours and imagery.
The range is pretty tiny though. It feels as though the sentiment is tightening - pressure building for a bigger move soon perhaps ?
PMQs were reported on ITV earlier and May was taking a firm line. Barnier has said aparently that “we need another year…” to negotiate.
PM May seems to be having none of it ! Neither that nor the calls for another referendum (“The People have spoken …!”). She was also firm that “we shall not be abandoning parts of the uk” ! (on the Irish border issue).
They say it takes a long time to grow into a new job. Yet there seemed to be “words of Iron” in her this morning. Coupled with the “Chequers confrontation” a few months back - Perhaps we have some evidence that the Lady is “Growing into it” …?
Absolutely! One of the reasons why collecting bank notes is so interesting!
Here is one from the Northern Bank featuring John Boyd Dunlop, who is credited with developing the pneumatic tyre. He was actually born in Scotland but spent most of his life/career in Northern Ireland:
Yes, very much so. The biggest problem is knowing when a breakout turns out to be a big move - at least with the EURUSD.
If we look at this year to date on a daily chart there has been two long periods sitting in a broad range with only a couple a significant moves. Those ranging periods are notable for the number of breakouts that quickly collapsed back into the range - not easy stuff!
I don’t like the price movements for EURUSD this year, this creates an underlying uncertainty that the market could “turn at any moment” which, in turn, builds a nervousness with carrying positions for any length of time. I’ve been trading short term for so long that I would really like to move into a position type trading - but the markets are not having any of it!
But these ranges are quite broad and there should be room for some bigger trades, but this week is not presenting them yet…!
Thanks, I didn’t know that. Northern Bank is nowadays Danske Bank, I guess this change of colour preceded that.
Wikipedia: “Following the £26.5 million pound robbery in 2004 at Northern Bank’s money handling centre in Belfast, Northern Bank announced, on 7 January 2005, that all its notes were to be recalled and reissued in different colours and styles, and using the bank’s new logo. The reissue began on 14 March 2005 and was scheduled to take one month; old notes remain exchangeable at branches of Northern Bank.”
Lovely old photo of Northern Bank in Mohill, Co. Leitrim!
This is another example of a change of notes colour. I am told that the colour change was implemented during World War 2 due to rumours of a plot by the Nazis to flood the UK with counterfeit notes in an attempt to create economic chaos…
We didn’t see much of a bounce here after the initial break so I have gone short again on EURUSD (I have also decided to revert to again only trading this one pair)…maybe this move will develop this time. I will keep this position until my method throws it out so let’s see where it gets - if anywhere!
Good follow-through on the downside having broken some notable levels
Closed out half of the new position here (approaching 1.1500) and moved stop to approx b/e so balance of new position is now on a free ride…
EURUSD has managed to find some dollar strength yesterday following Monday’s inside day and Tuesday’s negative pin bar. We broke through Friday’s close and continued without much bounce from there down.
But before getting too excited about the downside I have to remind myself that we are still within last week’s very narrow range. On the daily chart it looks like we might, in the near term, extend to - and find support in - the area between 1.1465 and last week’s low around 1.1430. Will look again if/when we break through that low.
On the upside I am looking first at the daily pivot from yesterday at around 1.1525 and then a return to last Friday’s close at 1.15567…
