EURUSD starts the NY day testing the 100 hour MA

• gregmikefx
• January 14th, 2010

The 100 hour moving average for the EURUSD comes in at the 1.4487 and NY is testing that moving average as they enter their trading day. The EURUSD has been consolidating over the last 3+ day after moving higher early on Monday.  The price has been in a narrrow trading range during that time staying between 1.4458 and 1.4579.  The 121 pip range is narrow and the market is likely to extend outside the range at some point this week - or at least you would think it would.

At 7::45 the ECB announced no change in interest rates, but the market will be more interested in hearing the thoughts of ECB President Jean Claude Trichet at 8:30 AM. He is likely to balance a recovering economy with worries about the sovereign debt of weaker EU countries like Greece.  At 8:30, the US will release Retail Sales (+0.5% exp vs +1.3% last, ex Auto +0.3% vs +1.2% last month), Initial Claims (437K vs 434K last)), Import Price (+0.0% expected but YoY rising sharply to +8.6%), and finally Business Inventories which is expected to show a gain of 0.3% vs +0.2%.

From a technical perspective, a move below the 100 hour MA at 1.4487 would turn the bias to the downside/bearish.  Support comes in at 1.4458 (low of the 3+day range)  and the 1.4421/30 area where the 200 hour MA (1.4430) and the 50% retracement of the move higher from the January 8th low (1.4421) is located.

The topside resistance comes in at the 1.4510/18 level this morning. The 1.4510 level is the close from yesterday and 1.4518 is the 100/200 bar MA on the 5 minute chart. If the bias is going to remain to the downside, the price will need to stay below these 2 key moving averages this morning (see chart below).

With all the data due at 8:30, the move is likely to be delayed until that time.    What we do know is with the market currently at the 100 hour MA, the bias is on the fence as we speak, but the move after the data, should dictate the direction for the pair for the day.

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

Tickers: $EURUSD

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