Nial Fuller's  Instablog

Trading Setups / Chart in Focus:

Gold

The gold pin bar setup that we first discussed in our members’ commentary on Tuesday of this week has come off nicely into the end of the week. We can see this setup was very confluent because it was in-line with the near-term bullish momentum and it had both horizontal support at $1700.00 and the dynamic support of the 8 / 21 daily EMAs. Many of our members’ traded this setup and discussed it before hand in the forum. This is a prime example of how to successfully trade the daily charts.

EURUSD

The EURUSD held the line of support at 1.3650 – 1.3600 this week. We can see price essentially just consolidated above this support level this week after Monday’s big sell-off from 1.4250. Next week we see near-term resistance near 1.3900 – 1.3950 coming into play, price will need to move above this level to have a chance at re-testing the core level at 1.4250. Otherwise, more chop sideways is possible until price pushes above the near-term resistance or breaks out below support near 1.3600.

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Forex Commentary:

In the currency markets today, the U.S. dollar gained modest ground against the other majors on the back of increased estimates from the U.S. Labor Department about new jobs. Continued pessimism over the euro-zone debt crisis also worked to push the greenback higher today.

The EURUSD moved to $1.3770 today, from $1.3822 on Thursday.

The GBPUSD was essentially unchanged on the day, as was the NZDUSD. The U.S. dollar gained marginally on the yen and more significantly on the Swiss franc and Canadian dollar, the greenback was also higher against the Australian dollar today.

Other Markets:

In the U.S. markets today, stocks lost ground and put an end to four weeks of consecutive gains. Instability in the euro-zone debt crisis plans reemerged and investors anticipated a confidence vote in Greece after the New York market close. The inability of European officials to make any real progress on a bailout plan has put investors on edge in recent days.

The Dow lost 61.23 points, or 0.51 percent, the S&P 500 dropped 7.92 points, or 0.63 percent, and the Nasdaq lost 11.82 points, or 0.44 percent.

Upcoming important economic announcements: 11/6/2011

8:30pm EST: Australia – ANZ Job Advertisements m/m

11/7/2011

7th-8th: Britain – Halifax HPI m/m
8:30pm EST: Australia – Trade Balance

Trading Setups / Chart in Focus:

EURUSD

The EURUSD has found some support near 1.4000 today. We are still slightly bearish biased here and would watch the 8 / 21 day EMA resistance layer as a potential selling-zone if we get any obvious bearish price action strategies forming in this area.

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Forex Commentary:

The euro rallied on Wednesday as sovereign debt worries subsided temporarily after a German court backed the country’s role in euro zone bailouts, though gains may be limited ahead of a European Central Bank meeting.

In early afternoon trading, the euro was up 0.6 percent on the day at $1.4059, off a session high of $1.41504 hit immediately after the German Constitutional Court’s ruling. The euro though was still down 2.0 percent this month.

Commodity currencies also rose, with the Australian dollar up 1.3 percent at US$1.0636, buoyed by a report showing the Australian economy grew at its fastest pace in four years last quarter.
The dollar, meanwhile, was down 0.4 percent against the yen at 77.300 yen

Other Markets:

On Wall Street today, stocks rose more than 2 percent, ending three days of losses after Germany’s top court paved the way for Berlin’s participation in bailouts that might help Europe’s debt crisis.

The Dow added 275.56 points, or 2.47 percent, the S&P 500 gained 33.38 points, or 2.86 percent, and the Nasdaq added 75.11 points, or 3.04 percent.

Upcoming important economic announcements: 9/8/2011

7:00am EST: Britain – Asset Purchase Facility
7:00am EST: Britain – Official Bank Rate
Tentative: Britain – MPC Rate Statement
7:45am EST: Euro-zone – Minimum Bid Rate
8:30am EST: Canada – Building Permits m/m
8:30am EST: Canada – Trade Balance
8:30am EST: Euro-zone – ECB Press Conference
8:30am EST: United States – Trade Balance
8:30am EST: United States – Unemployment Claims
1:00pm EST: United states – Fed Chairman Bernanke Speaks
10:00pm EST: China – CPI y/y

Trading Setups / Chart in Focus:

AUDUSD

The AUDUSD moved lower today after rejecting 1.0600 resistance and forming an obvious pin bar strategy on the 1hr chart. Note the exact gap fill that occurred when the 1hr pin bar formed. We discussed watching for intra-day sell signals showing rejection of 1.0600 in yesterday’s members’ commentary and many of our members caught this obvious intra-day price action setup.

EURUSD

The EURUSD moved substantially lower today after rotating higher intra-day and rejecting the 8 / 21 day EMA resistance layer. We mentioned yesterday that a close below 1.4000 would be bearish, and price has closed around 1.3990 today. We see a clear bearish bias here and would look to sell rallies to resistance with price action confirmation. The next obvious support comes in around 1.3836.

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Forex Commentary:

The Swiss franc plunged nearly 10 percent against the euro on Tuesday, posting its worst day ever, after Switzerland’s central bank jolted markets by setting a limit on how much the franc can gain.

The U.S. dollar rose as high as 0.86250 franc and was last up 9.4 percent at 0.86150 franc, snapping a four-day drop against the franc.

Despite the euro’s steep gains against the Swiss franc, the single currency fell against the dollar, down 0.7 percent on the day at $1.39910 and below 1.4000 – 1.4050 support. It fell to a low of $1.39720.

The dollar rose against the yen on speculation the SNB’s measures could encourage Japanese authorities to intervene in coming days. The dollar was up 1.0 percent at 77.690, well off a record low of 75.941 struck on Aug 19.

Other Markets:

On Wall Street today, stocks lost ground for a third day in a row on fears that Europe has failed to properly tackle its debt crisis, this prompted worries that the market is headed to new lows for the year.

The Dow lost 100.96 points, or 0.90 percent, the S&P 500 lost 8.73 points, or 0.74 percent, and the Nasdaq lost 6.50 points, or 0.26 percent.

Upcoming important economic announcements: 9/7/2011

Tentative: Japan – BOJ Press Conference
7th-8th: Britain – Halifax HPI m/m
4:30am EST: Britain – Manufacturing Production m/m
9:00am EST: Canada – BOC Rate Statement
9:00am EST: Canada – Overnight Rate
10:00am EST: Canada – Ivey PMI
9:30pm EST: Australia – Employment Change
9:30pm EST: Australia – Unemployment Rate