Euro Recovering Ahead of German Vote; Markets Under Pressure After Another Sell-Off

Article originally published on and republished here with permission

Quote of the day: “Nothing great was ever created by waiting around for someone to tell you it’s all going to be okay or for perfect information to drop from the sky” ~ Jonathan Fields

Good morning. The markets pulled back yesterday in risk-off trade but the euro is currently recovering ahead of German lawmakers vote on changes to the European bailout fund. Some of recent reversal patterns  highlighted two days ago are still in play although momentum has lost traction after yesterday’s sell-off. All eyes are on euro these days, especially due to German vote. Other important events of today’s economic calendar are the Initial Jobless Claims and the GDP later today in the US.


Still looking for direction as both support and resistance hold. Upside is slightly favored at time of writing, therefore keep an eye on resistance around 1.37

Euro vs US Dollar Chart 4hrs 9-29-2011Euro vs US Dollar Chart 4hrs 9-29-2011


Similar story here as cable is retesting resistance after pulling back in recent trading sessions. A plan to consider is to look for buying opportunities on rallies above 1.5670/00 where first resistance resides.

British Pound Vs US Dollar Chart 4hrs 9-29-2011British Pound Vs US Dollar Chart 4hrs 9-29-2011


Not really an interesting setup right now but could turn interesting in the next sessions. As seen below, the Aussie dollar is struggling to recover against the kiwi but has yet to return above the rising trendline which provided support few weeks ago. Next resistance comes at 1.28. I think that buying scenarios are worth to consider if price rallies from here and breaks above this week’s top, eventually

Australian Dollar Vs New Zealand Dollar Chart Daily 9-29-2011Australian Dollar Vs New Zealand Dollar Chart Daily 9-29-2011


This one and the others (positively correlated by over 80%) such as AUDJPY are looking ugly today after yesterday’s sell-off. Well, in case this is yet another risk on/off ping-pong game played on a daily turn basis, then a new reversal candle is what to expect. It definitely doesn’t look bullish like two days ago as yesterday’s price action provides one big warning sign. Sellers are still in control and a decent break above .9900 – parity zone is needed to signal a change of sentiment.

Australian Dollar Vs US Dollar Chart Daily 9-29-2011Australian Dollar Vs US Dollar Chart Daily 9-29-2011


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