G’day Surfers – how was race day?
EUR/USD’s gallop to the North we were expecting certainly took place with Price Action out of the barrier pre-London session, racing straight to 1.3021. Recognising it was running on a circuit, PA simply followed the rules, changing direction at Resistance (last Thursday’s high) and returning to the starting point, to deliver another Doji day. We were rendered as spectators by the spirited dash North, recognised pullback was necessary but the return leg was too dramatic to produce a reliable entry – so we didn’t. We did see an opportunity on EUR/JPY with our Swing & Relax strategy and at the time of writing – are awaiting entry still.
It all starts to go Fundamental on NFP week Thursday but for what it’s worth, there appears to be a Pivot Summit taking place @ 1.2970. Maybe it can produce positives for EURO where other Summits have failed!! Daily appears to be in the North wing but Weekly & Monthly are deep in conference, Monthly a meagre pip above Weekly. Technically, this would tend to keep Price Action in check. With the French & Italians enjoying a Bank holiday that may well be the early situation. When I look at current PA – that doesn’t look likely however. A truck load of High Impact News scheduled for release in the US today should change that later on, providing things have returned to some sort of order post Sandy. The potential for a Head & Shoulder to form on all intraday charts is certainly there so I guess we technicians will be following that development. I do feel the ping pong game between 1.3033 & 1.2908 will be decided in the next 48hrs. Bulls or Bears?…………….
The Day Ahead
It’s really a 50/50 call for me today but with DP untested, I’ll look for an opportunity to steal some pips, if Price Action creates some space below the resistance currently been provided by the WP/MP combo. It’s a fairly weak Plan A but until Price Action gives me something – it’s all I have. I just finished writing this and Price Action has indeed shown me something – again PRE-LONDON!! I certainly have the space I sought – finding an entry is the challenge. Don’t forget the nearer NFP gets, the more unpredictable Price Action gets – proceed with caution.
High Impact News
|1:15pm||USD||ADP Non-Farm Employment Change|
|3:00pm||USD||CB Consumer Confidence|
ISM Manufacturing PMI
Have a thumping Thursday.
Davide Franceschini | Chief Trader and Founder at SurfingThePips.com