The activity is slowing down as London/European traders exit for the day and Thursday starts to transition into Friday (which is the day before a 3 day weekend). This may get really quiet as traders take another day off tomorrow – at least in the US . Tomorrow the economic calendar is light with German GDP for 1Q (final cut), German IFP, Italy Retail Sales, Canada CPI and US New Home Sales. Hmmm… not sure there is a lot of firepower in that schedule.
Nevertheless, looking at the hourly chart above, the price in the NY session, is continuing a move lower – and trades near the lows for the day – after the Public Sector Borrowing numbers disappointed. The price decline – off the highs – has moved toward trend line and 100 hour MA (blue line in the chart above). The trend line comes in at 1.6857 currently. The 100 hour MA comes in at 1.6844. The low for the day is at 1.6851 -between the two support levels. Trader’s who are short, would want to see the price stay below the trend line and continue back through the 100 hour MA.
On the topside now, intraday traders have used the 1.6876 level as resistance since breaking below it during the London session. This level was the high price going all the way back to November 2009 (see weekly chart below). The price moved above this level earlier in May eventually rotated back below it. Yesterday, the price traded above and below the level but closed above the level (bullish). Today, the data did not support a further rally for the pair, and traders pushed the price back below this borderline level. Intraday traders started to lean against the level (see hourly chart above). As a result, it becomes a level to get back above if the price is to move higher.
The borderlines are defined, the question now is, will the market traders find enough activity to push it one way or the other?
———————————————————————————————————————–
All information on this site is provided for informational and educational purposes only. Information provided is not to be misconstrued as trading advice. Past results are not indicative of future results. In addition trading in foreign exchange markets on margin carries a high level of risk, and may not be suitable for all individuals.