During the London session we had some bad news for the Euro...it's trade account balance fell into the negative, and the previous month was revised downward. Remember, this means that they imported more than they exported in terms of euros. And this is a bad thing. What did the euro do? It popped up sixty pips! This is again what I was referring to yesterday when I mentioned seasons when even bad news is taken to be good. However, the pair stopped at the big figure of 1.3000, pulled back 50 pips, and has been pausing ever since. Some cracks in the dam? Has the bull finally spent his strength? Who knows? We came close to our stop, and another run up could be detrimental. We'll see.
For those who are in this trade, watch the price action through the end of the day. If we should close higher but not get stopped out, you may want to simply exit the position for the weekend. The reason being is that the euro has had some very large weekend gaps recently, and if it looks like the steam is building underneath it, it could gap open well past our stop. If, on the other hand, it appears to be moving lower, you may feel more comfortable about letting it ride, and we may even get a gap lower opening.
On the sterling side, the break appears to be starting, and we may have gotten in just in time. All these downside moves have been pretty well supported by buyers, but even if we get a move to half of the channel it should take us down to our target. A move to the bottom would be even better. Given the nice turn of events, be sure to move your stop down as recommended in the alert. You may even want to move it down to break even.
As I mentioned in the alert, I will be away next week and correspondence may be limited. I also need to step out of the office later today so I will not be around for the weekly close. If necessary, I'll send out a line or two tomorrow as I expect to be on the road when markets open on Sunday. Otherwise, we'll hold with the existing parameters.
Have a great weekend!
Bill
www.thefxtradingmasters.com
bill@thefxtradingmasters.com
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