Trade Idea: 2007-02-08 09:40
As the market expected, there was no rate hike from the ECB this morning, but there were a few changes in Trichet’s speech afterwards. We saw the return of “strong viligance” and other hawkish rhetoric such as the “ECB still needs to act in a firm and timely manner.”
We saw Euro buying across the board against all of the majors, and this will probably continue throughout for the rest of February and March until the next ECB meeting. In the short term, I we may see EUR/USD push up on this news. If we do, we may see it fizzle out near 1.3050. We also used the Fibonacci Extension tool on recent price action to find resistance near that area as well. Here’s a very short term trade idea:
Short half position EUR/USD at 1.3045, stop at 1.3075, pt at 1.3025
Remember to never risk more than 1% of your account on any single trade, so please adjust your position sizes accordingly.
Good luck and good trading!
No Trades: 2007-02-07 23:28
No pick this evening. There was nothing really compelling on the charts at the moment, especially with the Bank of England and European Central Bank rate decisions coming up later today. Events like that usually negate any technical setup. So we will wait until after the rate decisions, and hopefully a trade opportunity will present itself during the US trading session. Stay tuned!