Walking 18 holes under 35 degrees celsius (that's what it felt like) was really a killer! Boy, am I glad I survived. Guess its time to head back to the gym.
Monday was basically sideways consolidation with price remaining capped as E$ had gone parabolic on last Friday. Now that the Fed's QEternity is behind us, market may start to turn its focus back to the eurozone, specifically on Spain. For today, attention should be on the German ZEW economic sentiment data at 1700hrs (Sin/HK) which the market has factored in an improvement at -19.4 from the previous month of -25.5.
My source did not update the CFTC speculative account report but intuitively one would have expected a further reduction in the net E$ short positions.
Stop loss orders are residing at 1.3050/60, 1.3070 & 1.3180 and noteworthy limit orders at 1.3060 (Asian sovereign?), 1.3170/75, 1.3200 & 1.3250.
Technically, short term intraday indicator is at o/s level but longer term still has quite a bit of mileage. Important to note is that bearish divergence has emerged and that has increased the probability of a near term top already in place. Intraday momentum has turned from up to consolidation to down and the weekly also suggest a potential consolidation after recent weeks of the sharp rally.
For today, I expect a trading range of 1.3000 - 1.3140 (both on first test). The baseline being the neckline as drawn in the chart below. It would actually have been an extension from yesterday's sell rally call. Just pay abit of attention on the price action when market nears 1.3050/60. If unsure, always prudent to scale out in 2 batches.
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| E$ Daily chart - Neckline turned support |
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