Trading Setups / Chart in Focus:

EURUSD

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The EURUSD moved modestly higher today but closed the day well off its highs after rejecting the dynamic resistance between the 8 and 21 day EMAs.

Price may resume moving lower from current levels after today’s bearish rejection candle, but we would have liked to see a more obvious price action rejection signal form before considering a short. Price will encounter support near 1.3400 and will need to break through this level to move substantially lower. We will continue to wait for a more obvious daily chart sell-signal if price rotates higher in the near-term.

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Forex Commentary:

The EURUSD gained ground today on the back of new hopes that European policy makers are considering boosting a bailout fund; however, given the overall anxiety over the euro-zone debt crisis, gains could be limited for the euro.

The EURUSD closed the day at 1.3580, substantially up from its 8-month low on Monday of 1.3361, but off the day’s highs.

The AUDUSD and NZDUSD also rallied today after a recent sharp sell-off. The AUDUSD was up about 1.2 percent and the NZDUSD was up about 1.5 percent.
The greenback was about 0.5 percent higher against the Japanese yen today, holding above support near 76.00 still

Other Markets:

On Wall Street today stocks gained ground again on the back of increased optimism after euro-zone officials made efforts to strengthen the region’s rescue fund and lessen the chances of an increased debt crisis.

However, after a report suggesting problems with a previously agreed upon deal to thwart the crisis, stocks ended the day well off their highs.

The Dow moved up 146.83 points, or 1.33 percent, the S&P 500 gained 12.44 points, or 1.07 percent, and the Nasdaq added 30.14 points, or 1.20 percent

Upcoming important economic announcements: 9/28/2011

8:30am EST: United States – Core Durable Goods Orders m/m
5:00pm EST: United States – Fed Chairman Bernanke Speaks