It was a very choppy day today in the markets. The US GDP and New Home Sales report both came out with disappointing but the Dollar still managed to hold some ground against the Swissy and Yen.
Well the Euro did fall to 3200 like I thought it would but it fought back hard and ended up closing only slightly below its open price at around 3232. Daily stochastics are still in overbought territory but 4hr stochastics have crossed up. We could probably see a move towards 3250 followed by a retracement towards the 38% Fib line on the daily chart which is currently around 3100. This could take a few days to play out but in the short term look for a small rally followed by a another downward move.
The Cable once again made some crazy moves. First it looked like the Dollar was going to make a nice push against the Sterling but the Dollar ended up falling back down and the Cable ended up closing higher than its open at around 9640. 4hr stochastics are trending up and daily stochastics are converged together right at the overbought territory. We will probably see the Cable move up during the early part of the day and then watch it fall back down to around it’s open. The Cable has been a very frustrating pair to trade at the moment because it is really not going anywhere. You’ll see wide swings only to have the price end up closing right where it opened. Be very cautious when trading this pair.
The Swissy ended up retracing all the way up to around 2240 but ended up falling back down to around 2185. Daily stochastics are in oversold territory but 4hr stochastics are trending down which means we could see more downward movement. Look for a move back down to around 2150, and after that we should see the pair move back up.
The Yen managed to retrace back up to its 100 SMA on the daily chart. Daily stochastics are still trending down so I think we could still see the pair make a run towards its 200 SMA. The 200 SMA will be the make or break area for this pair so pay close attention to it. The 200 SMA is currently at around 117.38.