Trading Setups / Chart in Focus:

EURUSD

The EURUSD rejected lower prices again today and closed the day up about 90 pips. The pair closed right at the 8 day EMA resistance level. Any further upside moves are likely to be limited by the containment / resistance area coming in around 1.3600 and the 21 day EMA, and we will watch this level closely for price action sell signals.

GBPUSD

The GBPUSD formed a counter-trend fakey with pin bar today. Note that the containment / resistance level comes in around the 21 day EMA just like in the EURUSD, and we will watch this level closely for bearish price action sell signals. We could see a move higher here, but as with any counter-trend signal you should only attempt them if you are very experienced and have already mastered trading with the trend.

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Forex Commentary:

The EURUSD gained ground today, moving up about 90 pips after the European Central Bank announced plans to help support the regions banks and held interest rates at 1.5 percent.

The euro was also higher against the yen and Swiss franc today, after it gained about 0.5 percent against each.

The GBPUSD moves to a 14 month low against the greenback today but recouped much of its losses as the New York session closed.

The U.S. dollar dropped 0.2 percent against the Japanese yen to close at 76.70.

Other Markets:

On Wall Street today stocks gained ground for a third consecutive day as investors grew optimistic about euro-zone plans to support European banks.
The Dow gained 183.38 points, or 1.68 percent, the S&P 500 added 20.94 points, or 1.83 percent, and the Nasdaq added 46.31 points, or 1.88 percent.

Upcoming important economic announcements: 10/7/2011

Tentative: Japan BOJ Press Conference
4:30am EST: Britain – PPI Input m/m
7:00am EST: Canada – Employment Change
7:00am EST: Canada – Unemployment Rate
8:30am EST: United States – Non-Farm Employment Change
8:30am EST: Unemployment Rate