Hey folks,
I didn't think we'd see quite as hearty of a bounce on the EU and GU that we did on Tuesday, but with much higher than expected CPI out of the UK, and ZEW readings out of Germany and the Eurozone, it certainly helped fuel a bigger bounce than I expected. That said, the bigger trend still remains down. After a bit of a turnaround Tuesday, the EUR/USD is likely set up to turn lower Wednesday, but I'm not sure enough about it to make a call of a top just yet. Keep in mind guys, I put this into a reply to a comment in yesterday's signal:
"I'm pretty confident the EUR/USD is in a clear downtrend now, but as everyone knows, even trends have a lot of 2 way action along the way. That's why it's important to be careful about chasing things short. There's only twice I've specifically mentioned it was a good time to enter a position or swing short on EU, and that's August 4th to 6th around 1.4380 and August 13/14th around 1.4250-1.4300. If you're hurting on margin, you obviously chose to sell at some other point and got caught in a bounce. I expected the recent decline to kick back in sooner and with less retracement than we've seen, so I got caught stopping out on a trade or two on GBP/USD, but the overall position is still short.
Be real careful guys, if you trade position, you have to trade much smaller lot sizes and be more patient. The Euro's pending several thousand pip decline if fully realized will likely take 6-9 months to fully form. Along the way we will see some wicked bounces, so you don't want to just blindly short at a break of support and expect to never have it run against you."
Anyways, I'm definitely biased short for Wednesday, but I'm not looking to get too aggressive with it since I'm already in short from higher prices.
On Silver and Gold, I think we're comfortably poised to see sharper declines along with the USD gains and equity market pullback. On Silver particularly I've been calling for long term shorts there anywhere from $13.40 to $15 over the past few weeks, and it's finally starting to roll over. A more pivotal support level will come into play around the $12.80 to $13.90 range as the neckline/trendline support of a sloping head and shoulders will be the key area to watch.
In Stocks, I think we're seeing the typical "break through it, then trade back up to it before continuing on" type of price action that I often talk about. If you remember, the key level we had been watching was about 992 and we blew through it hard early on Monday. Then on Tuesday we floated back up to that general region... so there's a good chance we'll find that area as resistance and have a down day today (Wednesday). If that does happen, a nice selloff will also help fuel the EU and GU lower. In news Wednesday:
0430 BoE Minutes - I'm choosing not to trade this one since more current information was released with the BoE's quarterly inflation report last week. It could end up being a market mover, but the odds are low.
0700 CAD Core CPI m/m (expected at 0.1%) - The USD/CAD seems to be working out of its news trade funk and producing some tradable moves lately, so we'll try to extract something out of this one as long as the Core and Headline numbers come out in the same direction.
If it comes out at 0.4% or higher, USD/CAD should sell off 30 pips.
If it comes out at -0.2% or lower, USD/CAD should rally 30 pips.
TRADE LIVE WITH SIR PIPS FOR $39.00 FOR 2 WEEKS
Sir Pipsalot has a live trading room, in which he trades these news reports. There, he shares his trades in real time, including exact entries and exits, and detailed explanation for every entry and exit. The service costs $299 per month, but we have a 14-days $39.00 trial. Go to http://www.forexdiamonds.com/?i=8" and take advantage of this offer. This offer is for NEW customers only.
To our success,
Sir Pipsalot
I didn't think we'd see quite as hearty of a bounce on the EU and GU that we did on Tuesday, but with much higher than expected CPI out of the UK, and ZEW readings out of Germany and the Eurozone, it certainly helped fuel a bigger bounce than I expected. That said, the bigger trend still remains down. After a bit of a turnaround Tuesday, the EUR/USD is likely set up to turn lower Wednesday, but I'm not sure enough about it to make a call of a top just yet. Keep in mind guys, I put this into a reply to a comment in yesterday's signal:
"I'm pretty confident the EUR/USD is in a clear downtrend now, but as everyone knows, even trends have a lot of 2 way action along the way. That's why it's important to be careful about chasing things short. There's only twice I've specifically mentioned it was a good time to enter a position or swing short on EU, and that's August 4th to 6th around 1.4380 and August 13/14th around 1.4250-1.4300. If you're hurting on margin, you obviously chose to sell at some other point and got caught in a bounce. I expected the recent decline to kick back in sooner and with less retracement than we've seen, so I got caught stopping out on a trade or two on GBP/USD, but the overall position is still short.
Be real careful guys, if you trade position, you have to trade much smaller lot sizes and be more patient. The Euro's pending several thousand pip decline if fully realized will likely take 6-9 months to fully form. Along the way we will see some wicked bounces, so you don't want to just blindly short at a break of support and expect to never have it run against you."
Anyways, I'm definitely biased short for Wednesday, but I'm not looking to get too aggressive with it since I'm already in short from higher prices.
On Silver and Gold, I think we're comfortably poised to see sharper declines along with the USD gains and equity market pullback. On Silver particularly I've been calling for long term shorts there anywhere from $13.40 to $15 over the past few weeks, and it's finally starting to roll over. A more pivotal support level will come into play around the $12.80 to $13.90 range as the neckline/trendline support of a sloping head and shoulders will be the key area to watch.
In Stocks, I think we're seeing the typical "break through it, then trade back up to it before continuing on" type of price action that I often talk about. If you remember, the key level we had been watching was about 992 and we blew through it hard early on Monday. Then on Tuesday we floated back up to that general region... so there's a good chance we'll find that area as resistance and have a down day today (Wednesday). If that does happen, a nice selloff will also help fuel the EU and GU lower. In news Wednesday:
0430 BoE Minutes - I'm choosing not to trade this one since more current information was released with the BoE's quarterly inflation report last week. It could end up being a market mover, but the odds are low.
0700 CAD Core CPI m/m (expected at 0.1%) - The USD/CAD seems to be working out of its news trade funk and producing some tradable moves lately, so we'll try to extract something out of this one as long as the Core and Headline numbers come out in the same direction.
If it comes out at 0.4% or higher, USD/CAD should sell off 30 pips.
If it comes out at -0.2% or lower, USD/CAD should rally 30 pips.
TRADE LIVE WITH SIR PIPS FOR $39.00 FOR 2 WEEKS
Sir Pipsalot has a live trading room, in which he trades these news reports. There, he shares his trades in real time, including exact entries and exits, and detailed explanation for every entry and exit. The service costs $299 per month, but we have a 14-days $39.00 trial. Go to http://www.forexdiamonds.com/?i=8" and take advantage of this offer. This offer is for NEW customers only.
To our success,
Sir Pipsalot