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Good day forex trading koalas!
In the previous review, we noted that the positive economic data streaming from the US probably caused an increase in risk appetite. Probably due to the low liquidity, the EUR/USD gained bullish momentum and tested 1.34.
Looking at the EUR/USD chart above, a small forex gap developed over the weekend. Having said so, forex gap traders speculating on a quick gap closure saw disappointment as the gap has yet to fill. In my opinion, forex gap trading is VERY risky.
The S&P 500 is in the green today and investors are probably still positive about the recent string of good economic data. The US ISM Manufacturing PMI was just released moments ago and it is as expected, higher than the previous month.
Long term koala traders will notice that i have not been mentioning about oil for sometime now and WOAH it is now above $90. I always mentioned that oil can be a clue to the global economy’s health and if the $90s are here to stay, i will say that we have made progress as a global economy!
With the liquidity of the market probably still below normal, expect the unexpected for the currency movements. If unsure, staying at the sidelines may be wise. With the rest of the Euro Zone reporting in to the currency exchange market tomorrow, surprises may await.
Tomorrow’s economic data lineup includes the German Unemployment Change.
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