Discuss EUR/USD News with a DailyFX Analyst

Kate Stewart · #1 (**permalink**) 04-23-2007, 03:24 PM

This thread is dedicated to the EUR/USD and will be moderated by a real DailyFX Analyst who will post news, research and anything else that pertains to this pair. Please feel free to express your opinion about what direction you believe the market will take and what you think about the research presented.

Please note that this thread is for posting about the EUR/USD only. Any postings not related to this topic may be moved. For threads that were previously available under this forum, please got to Strategies and Guest Traders and you will find it there.

Thanks a lot and happy trading!

Kate Stewart

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DailyFX Analyst · #2 (**permalink**) 04-24-2007, 02:05 AM

In our weekly trade or fade we argue that this week may see a rebound in the dollar if for nothing else then for technical reasons alone. The currency is grossly oversold with sentiment widely bearish and in these type of instances even a small upside surprise could trigger a powerful move.

Today we have Consumer Sentiment and Existing Home Sales. If we get better than expected results we may see a test of the 1.3500 figure as shorts try to push the pair lower and probe for the many stops scattered at that level.

What do you think will happen today?

analyzer · #3 (**permalink**) 04-24-2007, 06:30 AM

I am of the view that the market will spike higher before US data to make the data itself irrelevant. There still seem to be sizable Johnny come lately looking to buy the dip countering nervous longs afraid of losing their profit getting out. I can of course be wrong and will be looking at 3550 area to tell me so.

Jamie Saettele · #4 (**permalink**) 04-24-2007, 07:14 AM

The EURUSD will likely play out in one of two ways, both of which are near term bearish but one is more bearish than the other in the intermediate term. One scenario is that a triangle is unfolding from yesterday's low at 1.3541. In this case, the next move is down towards the 100% extension of 1.3637-1.3541 / 1.3585 at 1.3489. A rally to new highs would be likely then since there would only be 3 waves down from 1.3637. A break above 1.3585 negates the triangle interpretation and suggests that a flat is unfloding from the 1.3541 low. Resistance would shift to fibo resistance (61.8% of 1.3637-1.3541 at 1.3600) but the longer term implications are more bearish as a 3rd wave down would follow and leave open the possibility of a full 5 wave decline from 1.3637. Watch potential trendline resistance near 1.3470.

analyzer · #5 (**permalink**) 04-24-2007, 07:49 AM

I am a simple tape reader, technicals are too complicated for me. Added @2575.

analyzer · #6 (**permalink**) 04-24-2007, 08:36 AM

Quote:

Originally Posted by analyzer

I am a simple tape reader, technicals are too complicated for me. Added @3575.

Added @ 3582

DailyFX Analyst · #7 (**permalink**) 04-24-2007, 11:12 AM

Weak existing homes sales and consumer confidence changes the game this week. The EUR/USD has broken higher and even though we could see some retracement over the next few hours, if the German IFO number prints strongly tomorrow morning, we could see the EUR/USD hit a fresh all time high.

Jamie Saettele · #8 (**permalink**) 04-24-2007, 12:15 PM

The spike through 1.3600 is either the a 3rd wave or a C wave correction. Watch 1.3600 closely since 1.3601 is the 38.2% of 1.3548-1.3634. 1.3585 is the line in the sand for bulls. Coming under that level destroys the bullish structure and indicates more weakness ahead. Be wary of establishing longs though since a rally through 1.3634 and then 1.3637 would most likely represent the end of a 5 wave bullish sequence from 1.3541.

analyzer · #9 (**permalink**) 04-24-2007, 01:10 PM

I like this new forum setup, lots of different ideas from different people. Way to go.

Kate Stewart · #10 (**permalink**) 04-24-2007, 01:52 PM

Quote:

Originally Posted by analyzer

I like this new forum setup, lots of different ideas from different people. Way to go.

Glad to hear you like it! Make sure to encourage any other traders you know to start contributing. We are looking to build a strong trading community, the more the better

Kate

DailyFX Analyst · #11 (**permalink**) 04-25-2007, 01:57 AM

We have IFO ahead and the market is looking for another print higher. Yesterday the Belgian Business index printed at 3.5 vs. 1.4 which is considerably higher. many analysts like to use the Begian number to handicap the IFO because Belguim does 94% of its business within teh Euro-zone and is therefore reflective of the overall business confidence in the region. But beware the correlation is not full proof. We are sidelined ahead of teh report, unable to decide which of the two factors - the high euro (hurting exports) or the overall pick up in growth will prevail.

One aspect of this report appears to be a high probability - given the ugliness of US data yesterday, a good print from IFO could take EURUSD to all time highs.

Summerset · #12 (**permalink**) 04-25-2007, 01:13 PM

Quote:

Originally Posted by Kate Stewart

Glad to hear you like it! Make sure to encourage any other traders you know to start contributing. We are looking to build a strong trading community, the more the better

Kate

Yr Fourm has tremendously improved.
Much Appreciated effort.

My count takes Eurodollar intially to 3930, and maybe 4050 (attached).

It would be good to get other views on it.

Any good USD news, would be good for buying dips @ <3475-3515>. But that doesn't appear to be going to happen this week. And by next week it may be too late - (at least that's my bias).

DailyFX Forum Administrator · #13 (**permalink**) 04-25-2007, 01:46 PM

Hi Summerset,

Thank you for the feedback - if you have any further suggestions please feel free to email us at any time: moderator@dailyfx.com. This is just the beginning so please stay tuned for more additions.

As for the EUR/USD, although I agree it has the potential to go above 40 I am a little concerned with the EU. They are already getting squeezed and I wouldn't put it past them to intervene in a Japanese style way by simply making announcements or possible idle threats. On a side note, I'd also not like to see my $ be worthless when I take my vacation

Andy K · #14 (**permalink**) 04-25-2007, 02:04 PM

Quote:

Originally Posted by DailyFX Forum Administrator

Hi Summerset,

On a side note, I'd also not like to see my $ be worthless when I take my vacation

Bit late for that ! Coming from the UK I'm considering a New York shopping binge with my lovely pounds !

I'm afraid I'm more bearish on EUR/USD than Summerset, any surprises now will have to be in dollar favour. Either average news from US or average news from Europe will set a correction - and thats just average news, if some strong USD news comes out, or weak EUR news come out it'll be even more severe.

I suppose TA works because this type of market psychology recurs time and again - everyone is buying this pair thinking its invincible - sure, thats where trends come from, but there will inevitably be a hiccup, or worse.

Good trades all.

DailyFX Analyst · #15 (**permalink**) 04-26-2007, 07:09 AM

Quote:

Originally Posted by Andy K

Bit late for that !
I suppose TA works because this type of market psychology recurs time and again - everyone is buying this pair thinking its invincible - sure, thats where trends come from, but there will inevitably be a hiccup, or worse.

Good trades all.

True but as we wrote today, "While the latest Euro-zone data confirms the expansionary scenario for that region, the forecast for US economy is decidedly more murky. We have long argued that employment remains the absolute key to any dollar bullish argument going forward and to that end the weekly jobless claims numbers have taken on a much greater significance for the market this month as they have disconcertingly climbed higher from the 320K level to the 340K level in the past two releases. Therefore, today’s print may generate more volatility in the pair than usual if it once again produces a reading north of 340K. On the other hand, a drop back into the 310-320K would allay the concerns of a slowdown and the greenback may be able to extend its snapback rally further. "

So let see if US unemployment data has any resonance in the market today