So Mr. Draghi isn’t making
the trek to Jackson Hole, after all, he does have some pressing matters to
attend to. One less thing to worry about: The Italian bond auction was a sign
of confidence from investors. This means that traders are expectation that the
ECB will step up. The good news is that Italy sold 9.12b dollars of its debt at
below 6%. But alas, no one paid attention to this good news as the euro sold of
early in Thursday’s trading.
The euro slid in front of Bernanke’s
Friday speech and news that Spain was going to delay a bailout until terms were
clarified (read: Spain does not like the terms.)
One thing that the market hates is uncertainty
andthe eurozone not getting
along. This was a dose of both.
Another bit of data that was a drag on
euro optimism was the fifth straight month of German umemployment increase. While
the 2k miss from the 7k consensus may not seem like a reason to panic, notice
the trend since May.
Source: ForexFactory.com
Ultimately today’s euro and U.S.
equities weakness makes sense as traders are unwinding some expectation that
Bernanke will clarity his position on QE Friday. Frankly this event is not the
time nor place and with NFP next Friday it would be a mistake move to make any
clarification before the jobs number; and Bernanke knows this. The Dow and
S&P futures have both dipped below their respective major psychological levels,
so with the ES contract under 1,400 and the YM contract under 13,000 there is
some pessimism being discounted and we can’t put all the blame on Europe. The U.S.
Dollar Index (DX) remains trading within the bear flag I mentioned in yesterday’s
update.
Past performance is not indicative of
future results
Ther
daily EUR/USD remains near-term bullish on the daily but has begun to
consolidate (narrow sideways trading range) between the 1.2588 high and the
support along 1.2500 as well as the 89 period EMA close.
I think it’s worth mentioning that the
weekly EUR/USD remains in a firm downtrend and the resistance seen on the daily
time frame is actually weekly 20 period SMA close and 34 period EMA low
resistance. While I rarely trade enter spot trades off weekly chart analysis,
this is an excellent opportunity with relatively low volatility to look for put
options (futures) for the euro and/or EUR/USD.
As an
active forex trader and Chief Currency Analyst for InterbankFX.com I do write
for a number of sites all over the web and I am happy to say that I will be
posting updates atwww.IBFXconnect.com. MyActivity Boardwill feature the trades from my trading account as well as
intraday commentary.
Start the discussion! Questions?
Comments. Leave it here at the Daily Forex Trading Edge for Raghee to
personally answer. Using the icons at the top of the article to forward this
update to a friend via email, post it on Google or Facebook or simply print it
out for reading later.
Forex trading is one of
the riskiest forms of investment available in the financial markets and suitable
for sophisticated individuals and institutions. The possibility exists that you
could sustain a substantial loss of funds and therefore you should not invest
money that you cannot afford to lose.
Posted By:
Raghee Horner
Raghee Horner, chief currency analyst for IBFX, provides her personal daily trading tips and insights through Dailyforextradingedge.com. An experienced trader with over fifteen years in the markets, Raghee is the co-founder of EZ2Trade Software and has taught her brand of technical analysis and charting strategies to students all over the world. She is an international author and has taught currencies, futures, and equities trading for over a decade.
So Mr. Draghi isn’t making the trek to Jackson Hole, after all, he does have some pressing matters to attend to. One less thing to worry about: The Italian bond auction was a sign of confidence from investors. This means that traders are expectation that the ECB will step up. The good news is that Italy sold 9.12b dollars of its debt at below 6%. But alas, no one paid attention to this good news as the euro sold of early in Thursday’s trading.
The euro slid in front of Bernanke’s Friday speech and news that Spain was going to delay a bailout until terms were clarified (read: Spain does not like the terms.)
One thing that the market hates is uncertainty and the eurozone not getting along. This was a dose of both.
Another bit of data that was a drag on euro optimism was the fifth straight month of German umemployment increase. While the 2k miss from the 7k consensus may not seem like a reason to panic, notice the trend since May.
Source: ForexFactory.com
Ultimately today’s euro and U.S. equities weakness makes sense as traders are unwinding some expectation that Bernanke will clarity his position on QE Friday. Frankly this event is not the time nor place and with NFP next Friday it would be a mistake move to make any clarification before the jobs number; and Bernanke knows this. The Dow and S&P futures have both dipped below their respective major psychological levels, so with the ES contract under 1,400 and the YM contract under 13,000 there is some pessimism being discounted and we can’t put all the blame on Europe. The U.S. Dollar Index (DX) remains trading within the bear flag I mentioned in yesterday’s update.
Past performance is not indicative of future results
Ther daily EUR/USD remains near-term bullish on the daily but has begun to consolidate (narrow sideways trading range) between the 1.2588 high and the support along 1.2500 as well as the 89 period EMA close.
I think it’s worth mentioning that the weekly EUR/USD remains in a firm downtrend and the resistance seen on the daily time frame is actually weekly 20 period SMA close and 34 period EMA low resistance. While I rarely trade enter spot trades off weekly chart analysis, this is an excellent opportunity with relatively low volatility to look for put options (futures) for the euro and/or EUR/USD.
As an active forex trader and Chief Currency Analyst for InterbankFX.com I do write for a number of sites all over the web and I am happy to say that I will be posting updates at www.IBFXconnect.com. My Activity Board will feature the trades from my trading account as well as intraday commentary.
Start the discussion! Questions? Comments. Leave it here at the Daily Forex Trading Edge for Raghee to personally answer. Using the icons at the top of the article to forward this update to a friend via email, post it on Google or Facebook or simply print it out for reading later.
Forex trading is one of the riskiest forms of investment available in the financial markets and suitable for sophisticated individuals and institutions. The possibility exists that you could sustain a substantial loss of funds and therefore you should not invest money that you cannot afford to lose.
Raghee Horner