Take profit in EURGBP short recommendation

Yesterday we took profit at 0.8800 in our short EURGBP recommendation opened last October 20th at 0.9000.

The cross is just in the upside trend from Dec 2015. Ahead of the SuperThursday with the BoE and the IR this week it could be broken (if any hawkish signs from Carney are seen) with next support on the 0.85 zone.

Note: This analysis is a personal opinion based on my experience, not a professional signal service. For trading, you must base your decisions on your own criteria

Daily Comment

Daily Comment,

At the beginning of the European session we say a "Risk off" movement without a clear catalyst coinciding with the 30th anniversary of the 1987 crack, the famous black Monday as a backdrop. Movement towards safe havens like the JPY or CHF that corrected considerably and with stock American futures in red. Little by little the movement corrected to find us now practically at the same levels where we began yesterday's session.

The Budget approval by the US Senate has attracted demand for USD, next step will be the approval of the long awaited tax reform.

Yesterday's President Trump's brief meeting with Janet Yellen strengthen even more Jerome Powell as her favourite successor, which would mean keeping the same line in rates as the current Federal Reserve.
Just as a reminder of Trump's comments during the 2016 campaign, saying that "They're keeping rates artificially low", we are seeing again a President who differs a lot between his campaign proposals and the measures that he is currently carrying out.

The Euro demand continues against its main crosses, especially JPY, CHF and GBP. EURCHF has set new highs during the Asian session at 1.1630, levels not seen since the floor was withdrawn in January 2015.

Nevertheless, we continue to hold 1.17/1.19 range in the EURUSD and 111.50/113.50 in the USDJPY.

On Sunday the presidential elections will take place in Japan where, with a high probability, the current president Shinzo Abe will win again. We expect some volatility in the Asian opening this weekend especially in the crosses against the yen if the survey forecasts are not fulfilled .

H&S formation in the Daily EURUSD graph. To nice to be true. 1.1650 level to watch on the downside to confirm.

Sell ​​EURGBP 0.90 - TP 0.88 - 0.91

Note: This analysis is a personal opinion based on my experience, not a professional signal service. For trading, you must base your decisions on your own criteria

Daily Comment

Daily Comment,

Yesterday was a transition day ahead of the holidays in the USA and Japan.

Investors will be looking at the possible unilateral declaration of independence from Catalonia and consequently the Spanish State response, with a clear impact on the stock market and Spanish debt as well as the euro.

USD lost ground despite the good data published last week (ISM, NfP and unemployment rate) in a more technical correction than a trend change that in the case of the EURUSD could take us over 1.18/1.1850

The polls in Japan continue supporting the current President Abe for the 22th elections. We continue to see an asymmetric risk in the election event, if the current status quo is maintained, the JPY would weaken, although not having a large majority the appreciation of the Japanese currency would be much more important, with the replacing of Kuroda (President of the BoJ) and probably modifying the current stimulus program.

Yesterday the modification of the last salary data, because of a computer error with wages up from 1.6% to 2.4% give support to the GBP. The market discounts near 80% probability for a rate increase in the November meeting and an additional for the whole year 2018, so there would be scope to allocate more rises next year with the consequent support to the GBP.

USDCNH (white/blue) vs EURUSD (orange, inverse). Really good inverse correlation because of the currency diversification from the Bank of China.

If USDCNH contiue the downtrend will give support to the EURUSD

Stop profit executed at 1.1750 in short EURUSD position, opened at 1.20

Note: This analysis is a personal opinion based on my experience, not a professional signal service. For trading, you must base your decisions on your own criteria

EURUSD Stop modified

Ahead of the US employment data, we modified the stop loss of our short EURUSD position to protect part of the profit.

EURUSD Short 1.20 - TP 1.1650 - SL 1.1750 (from 1.1850)

Note: This analysis is a personal opinion based on my experience, not a professional signal service. For trading, you must base your decisions on your own criteria

Daily Comment

Daily Comment,

Election`s in Germany, political situation in Spain, Trump's long-awaited tax plan and Yellen's replacement are the main arguments to see an offered euro and bid USD that has led the EURUSD to trade below 1.17 during the Asian session.

In addition, the good manufacturing ISM data published yesterday (60.8 vs 58.8 in August), highest mark since May 2004 with the employment component and paid prices at highs since 2011 confirms the good momentum for the American economy.

The British manufacturing PMI data surprised to the downside, with a severe punishment to the GBP that lost slightly more than 1% against the USD while the Conservative Congress that is being held in Manchester this week.

In Japan the polls continue to be favorable to the current president Abe. We clearly see an asymmetric risk that in the event of a defeat could lead the USDJPY to the 105 zone and in case Abe`s victory going to the 115/116 zone.

As expected, the Bank of Australia has kept unchanged the official rate talking again about the risks of an AUD appreciation for its forecasts.

Light day in terms of macroeconomic data, Eurozone PPI and English construction PMI. Additionally, Powell's statement (14:30) will be analyzed because he is in good position to replace Yellen next year.

BBDXY Daily - Topping with the downside chanel

BBDXY Hourly - First divergences

EURUSD Daily - Good support to 1.16

 EURUSD Daily - Ichimoku cloud support is 1.16

EURUSD Short 1.20 - TP 1.1650 - SL 1.1850 (we modifiy the stop loss to protect part of the profit)

Note: This analysis is a personal opinion based on my experience, not a professional signal service. For trading, you must base your decisions on your own criteria