Ending With A Bang

As trading comes to a close today we will be closing out the week, month and quarter. More dismal economic news from the US will give the Euro another chance to paint more new highs. Expect the EUR/USD currency pair to push past the 1.4200 level. Technicians are still eyeing a 1.4250 high before all is said and done.

Waning Rally

Although the EUR/USD currency pair hit a new high during the London session, we are starting to see demand wane. On balance our indicators are pointing to a continuation of the rally, any long positions should be protected with tight stops. Event risk is also high today. US data includes initial jobless claims and second quarter GDP numbers at 12:30 GMT, and new home sales at 14:00 GMT.

Meandering Ahead Of US Data

After posting a high of 1.4161 yesterday the EUR/USD currency pair went through a period of consolidation during the Asian session. We currently have prices bouncing from the daily pivot and a test of yesterday’s high may be in the picture for today.Action may be somewhat muted as traders await the US durable goods numbers coming at 12:30 GMT. Another factor may be firming in the US dollar due to carry trade action in the USD/JPY pair. Again we’ll wait for the data to give us direction today.

US Dollar On Data Watch

Little impact was seen in the EUR/USD currency pair as German IFO numbers came in below expectations. Next up will be the US existing home sales at 14:00 GMT. The consensus is for a drop to $5.49M which is expected to add further fuel to the rate cut fire in the US. Our indicators are currently slightly bullish and eyeing support at 1.4086. A break could see a test of the overnight low of 1.4065, but with the waning uptrend still in place we expect to see another attempt to push beyond 1.4160.

Dollar Dives

We’ve seen the US dollar at record lows this week. The spot traded at parity this week with the CA dollar. Canadian retail sales data being released at 12:30 GMT could drag the USD even lower. Technicians look for the rally to resume with 1.4131 being the next target.

Bulls Return

With the EUR/USD currency pair easily breaking through the 1.4000 barrier, the bulls are now targeting 1.4500 as the next high point. We are long from 1.4041 and will watch for stalling near 1.4080.

Profit Booked On Fed Announcement

Yesterday’s Fed "surprise" allowed us to catch a nice profit on our long EUR/USD position. Although most people had expected a rate cut, the size of the cut was larger than expected. The currency pair is currently probing for support. Right now that looks to be 1.3941, the daily pivot. But our indicators still show a negative bias and we are not in any hurry to jump back in to a market without clear direction. We will wait for the US CPI and housing numbers to be released at 14:30 GMT before our next trade.

Consolidation Continues

Choppy consolidation continues with the EUR/USD currency pair. We are looking for the spot price to hit support at 1.3484 before continuing its uptrend.