SunbirdFX Daily Analysis 10.08.2011
The sharp declines in the US stock markets showed first signs for a possible correction. If the correction does occur, you should expect an aggressive 'short-squeeze' towards the opened gaps in the indices. The NASDAQ opened a gap at 2220 and the S&P 500 is opened at 1200 points. If you try this gap-system, you should have an organized set-up for the potential trade.
EUR/JPY
The correction in Wall Street might support the EUR against most of the currencies. This pair slid as we expected and got a support at 109.0. there is a "Head & Shoulders" pattern in the 4H chart , but indicators such as stochastic and ADX suggest that the Euro is about to rise from this point. A possible target for the potential rising would be at 112.0. A break-down of the bearish pattern might take the Euro down to 107.5.
GBP/USD
The riots in London affect the pound, which broke the critic support at 1.62. The next support is at 1.61, where the 200 SMA is waiting. However, there are still a few bullish signs that indicate for a possible strengthening of the GBP. In that case, it will have to break through the strong resistance at 1.647.
The manufacturing production was down by 0.4%, whereas expectations were for a growth of 0.3%. The inflation report this morning will have a high impact on the British pound.
GBP/CHF
This pair has produced hundreds of pips for those who followed Sunbird's daily analysis. The CHF is in a powerful momentum against any currency, but the more it is strengthening, the more it is likely to correct. Therefore, it would not be a good idea to enter the Swiss currency in its extreme levels, and waiting for correction and reversal is wiser.
There are many ways and systems to analyze reversals and one of them is using the Fibonacci indicator. In this pair, stretching the Fibonacci from the break-down level at 1.24 to the bottom at 1.14, shows that a the correction might hit 1.19-1.20, so the sellers might wait there and trigger the reversal. Obviously, no one can really predict the market, and this tool only helps you to get prepared, but you cannot set pending orders based on it.
The sharp declines in the US stock markets showed first signs for a possible correction. If the correction does occur, you should expect an aggressive 'short-squeeze' towards the opened gaps in the indices. The NASDAQ opened a gap at 2220 and the S&P 500 is opened at 1200 points. If you try this gap-system, you should have an organized set-up for the potential trade.
EUR/JPY
The correction in Wall Street might support the EUR against most of the currencies. This pair slid as we expected and got a support at 109.0. there is a "Head & Shoulders" pattern in the 4H chart , but indicators such as stochastic and ADX suggest that the Euro is about to rise from this point. A possible target for the potential rising would be at 112.0. A break-down of the bearish pattern might take the Euro down to 107.5.
GBP/USD
The riots in London affect the pound, which broke the critic support at 1.62. The next support is at 1.61, where the 200 SMA is waiting. However, there are still a few bullish signs that indicate for a possible strengthening of the GBP. In that case, it will have to break through the strong resistance at 1.647.
The manufacturing production was down by 0.4%, whereas expectations were for a growth of 0.3%. The inflation report this morning will have a high impact on the British pound.
GBP/CHF
This pair has produced hundreds of pips for those who followed Sunbird's daily analysis. The CHF is in a powerful momentum against any currency, but the more it is strengthening, the more it is likely to correct. Therefore, it would not be a good idea to enter the Swiss currency in its extreme levels, and waiting for correction and reversal is wiser.
There are many ways and systems to analyze reversals and one of them is using the Fibonacci indicator. In this pair, stretching the Fibonacci from the break-down level at 1.24 to the bottom at 1.14, shows that a the correction might hit 1.19-1.20, so the sellers might wait there and trigger the reversal. Obviously, no one can really predict the market, and this tool only helps you to get prepared, but you cannot set pending orders based on it.