I suggested yesterday that London traders would be scratching their collective heads as they primed the computers ready to face the day, post a substantial EUR/USD sell-off whilst they slept…….STRIKE 1. I further suggested that we would face a morning of consolidation……STRIKE 2. It was clear that Price Action would pullback after the big Asian move……Base Hit. The favoured setup was for a bounce off DS-1 & further falls…….FOUL. I found a Long entry signal using Surfing The Pips Secret Candle Patterns……HOME RUN! Yes, it was some pullback (110% in fact) and another great example of trading what you see, rather than what you think. Our Long order went to target nicely but the strength of the response to the Asia Session crash left me wondering what the sell off was all about? What can you say but Thanks for Giving us the rally.
From what I’ve seen since, you could be excused for thinking someone pressed the wrong button to trigger the sell off yesterday. Ironically, strong EURO buying prior to Asia session this morning took out DR-1 and a much more measured pullback from the new high sees us begin our day with EURO back under DR-1. EUR/USD has all but emerged through low cloud clover to reach blue sky however and a break above 1.2885 today would put 1.3000 back on the radar screen for the first time this month. So that is the key level of the day for me. Whilst I had Price Action firmly penned in with trendlines yesterday, it’s not the case today. I will rely on one to appear as a result of early trade – should any occur. I say that because it’s Thanksgiving in the States so no trading there – which usually flattens the market that I must say, for the past day & a half has sprung to life. Pivots are completely mixed with Daily centrally positioned between Monthly to the North & Weekly below. EUR/USD looks a tad overbought to me however and the fact daily is untested, gives me a short term Bearish bias. The pullback to DP would be great for us to find a Long!!
The Day Ahead
Well I got it completely wrong by stating we were in for a consolidation session yesterday (pleasingly) so I’m a little hesitant to suggest the same for today (but I think we are). Finding an entry will be interesting given the untested DP. It’s loneliness promotes disinterest in me going Long until price Action pays it a visit. Conversely, Shorting EUR/USD at the moment has its own challenges, such is the strength of the Bullish move. Patience required Very much today – if we get action, great setups required before entry considered.
High Impact News
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German Flash Manufacturing PMI
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Make the most of Thanksgiving Thursday