EUR/USD, EUR/JPY April 10, 2013 Commentary

In the trading room today, I was stopped out of my EUR/USD trade as we failed to stay below our key trading area (1.3050). There was a plethora of chop in the morning in trading, as we moved into late morning we then got  a drop then a pop. The retest came at another key level we discussed in the trading room.

I still favor the downside on the EUR/USD, however, now that we broke and have stayed above certain levels I am more prudent on my outlook.  The issue on the EUR/USD is has Europe really solved their problems? Is the Greece, Italy and Cyprus issue solved? NO! As we know, markets do not always move on fundamentals. Can the EUR/USD move higher? Sure it can, we will see over the next few weeks just how high or low we can go.

What I will be watching today as I look to trade U.S. session is if Euro session is able to gather enough steam to create a reversal candle on the 4 hour chart. This will setup nice for a possible further correction to the 1.2900 area. On the flip side if we move above 1.3125 and crack the 1.3155 then we may be headed for more squeezing.

EUR/JPY

On the EUR/JPY I began some shorts at our key level near the trigger 130.00 area. I will report how this trade turned out tomorrow. At the moment the area of 130.00 is of concern to me as is the AUD/JPY 104.40 area. If this are broken with momentum we can blow higher in a big way, on the flip side if we see a consolidation like we are at the moment, and a break lower we can see the bears pile in.

I will be looking to take trades on this pair as long as we can show momentum and good trade setups. With this pair it is important to understand that swings are very wide and aggressive.

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