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GBPUSD fakey and EURUSD recap, 10th March 2011

Forex Commentary:

Thursday saw the euro suffer its worst day against the dollar in a month after a cut to Spain’s credit rating kept euro zone debt problems in focus and left it vulnerable to more losses in coming weeks.

The euro fell 0.9 percent to $1.3788, its biggest daily slide since Feb. 10. It hit a four-month peak of $1.4036 four days ago after European Central Bank President Jean-Claude Trichet hinted at an interest rate rise as soon as April.

The Australian dollar fell after data showed China swung to a surprise trade deficit in February of $7.3 billion, its largest in seven years. The numbers stirred worries that China’s growth could slow and affect countries such as Australia, which has benefited from China’s expansion. The Aussie dollar was down 1 percent at $0.9996.

Sterling/dollar traded 1 percent lower at $1.6049 after the Bank of England held interest rates at a record low of 0.5 percent, as widely expected.

Trading Setups / Chart in Focus:

GBPUSD

The GBPUSD fakey setup that we discussed in yesterday’s commentary has come off to the downside as expected. Price moved aggressively lower and re-tested support near 1.6050-1.6000, some of our member’s were on board with this setup and we had good discussion in the forum regarding it.

This setup was a good example of how simple and logical it can be to trade based off raw price action and important levels in the market.

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EURUSD

The EURUSD rotated down into value at the 21 day ema today; however there are still no obvious bullish price action trade setups to warrant taking a long position.

We can see support sitting near 1.3750 and further below around 1.3500.

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For a more in-depth analysis of the major forex currency pairs and price action analysis, please check out my forex trading training course.

Other Markets:

On Wall Street today major indexes fell below key technical levels on the back of fears about the economy and unrest in Saudi Arabia.

Reports that authorities in Saudi Arabia had opened fire on demonstrators led to increasing anxiety about instability in major oil producing nations and caused the Dow’s worst day in seven months.

The Dow dipped 228.48 points, or 1.87 percent, the S&P 500 dropped 24.91 points, or 1.89 percent, and the Nasdaq lost 50.70 points, or 1.84 percent.

Upcoming important economic announcements: 3/11/2011

4:30am EST: Britain – PPI Input m/m
7:00am EST: Canada – Employment Change
7:00am EST: Canada – Unemployment Rate
8:30am EST: United States – Core Retail Sales m/m
8:30am EST: United States – Retail Sales m/m
9:55am EST: United States – Prelim UoM Consumer Sentiment
3:45pm EST: Britain – BOE Gov King Speaks