Just to share my observation from my holiday in the West Coast of USA. I am sure tourists are pouring to the country as the U$ is relatively weaker and this gives them more spending power. Just my friends alone, I know of about 6 families who have chosen West Coast as their year end vacation choice! Car rental and food are way cheaper than Europe. Gasoline price is surprisingly high though still cheaper than Europe and Singapore. One thing for sure, the service level has gone noticeably higher and I find Americans very helpful and generally friendly. I noted improvement in infrastructure like the roads. By the way, the Las Vegas strip is phenomenal! Lastly, I notice advertisements of easier credit to consumers (the QE is working!!).
Back to the market.... E$ was enjoying a great run, touching the high 1.3308 last night until news of stalled fiscal cliff talk between President Obama and the Republicans hit the market, sending E$ to close all the way near to the day's low near to where it opened. This reaction formed a shooting start formation in the candlestick pattern and is a short term bearish signal, which the spillover momentum depress E$ to 1.3189 low this morning. Yesterday's reaction to negative news is not totally unexpected considering how much it had run up recently and coming close to major resistance levels (around the 1.3400 level) would trigger some profit taking interest.
Latest update on the order book revealed the following:
Limit: 1.3140/50 and 1.3350
Stop Loss: 1.3140, 1.3310 and 1.3350
Technically, short term intraday indicator has bounced off o/s levels though longer term still has more room on the downside. Shorter intraday momentum suggest consolidation with upside bias but longer term momentum suggest consolidation to down.In summary, I expect some uptick from here but E$ may subsequently turn lower again. Expected range 1.3130/40 to 1.3250/60.
All the best.
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| E$ Daily chart - Shooting star formation |
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