Wednesday, May 19, 2010

The Advisor Weblog

The Advisor Weblog

Best pair to trade now: GBP/USD

Posted: 19 May 2010 04:06 AM PDT

Eur/Usd technical perspective

Posted: 19 May 2010 03:54 AM PDT

Well, from where to start? EUR/USD is capped under 1.2200 since breaking the level yesterday, approaching to 1.2130, that represents the 50% retracement of a Fibonacci rally, measured from the 0.82 all time low, to the 1.60 all time high; many eyes are focus on that level as an inflection point for the pair, yet as for my technical analysis I see stronger support just a bit under it, around 1.2110, really not much more difference, but anyway, if the pair lose this last, 1.2065 is next support area, followed by 1.2000 zone for today. Short term talking resistances lie at 1.2230, 1.2280 and 1.2330 zone. As you can see in the 4 hours charts, pair is quite comfortable in the 1.2160/1.2230 range, losing it’s short term oversold condition, and with 20 SMA above current price still with a strong bearish slope. Momentum is showing some bullish divergences, yet unless we really accelerate above 1.2230, I don’t see any  upside rally coming right now.

 

What’s really worth mention is that from a technical perspective, I can recall times with RSI at 15 in the weekly chart and yet, that’s no reason to buy the pair now and wait for a good upside corrective movement. i do believe that at current levels, if we lose 1.2100 pair would likely extend the rally to its inception level 10 years ago, around 1.18. Long term talking, and under that 1.1630 zone is next in line. Long term upside reversal levels, will have to wait until we could see a real bottom taking place.

 

Majors’ sentiment for today

Posted: 19 May 2010 02:42 AM PDT

Majors’ sentiment for today:

Eur/Usd: Bearish

Gbp/Usd: Bearish

Usd/Chf: Bullish

Usd/Jpy: Bearish

Eur/Gbp: Neutral

Eur/Jpy: Bearish

Gbp/Jpy: Bearish

Starting the day

Posted: 19 May 2010 02:19 AM PDT

Hi everyone, and welcome back. Seems lately, euro zone authorities are waiting for the end of European session, to made revolutionary announcements that are only able to push Euro lower, and lower. Yesterday, Germany introduced a short selling ban on government bonds and financial institutions, the idea is to avoid speculation: usually, short sellers borrow assets and sell them, betting the price will fall and they’ll be able to buy them later, return them to the lender and pocket the difference. In naked short-selling, traders never borrow the assets so betting is unlimited. It hs been used before as a temporal measure to avoid excess but froma  macro perspective is quite negative as investors want a free, liquid market to move on. The result is that instead of calming markets, they triggered further panic, and stocks slump both in American and Asian session, and now European indexes are just following the tie. Where is Euro heading? probably to levels under the 1.18 zone, the original price of the hegemonic currency. Will it move straight? no. We have today’s low as a quite interesting support area, we are going to take a look right now. Anyway! we  have inflation news in the US today, (following a negative PPI yesterday) so here is the link for today’s calendar:

http://www.fxstreet.com/fundamental/economic-calendar/

Have a great day!
Posted by at 5:35 PM

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