Forex Commentary, GOLD and GBPJPY, 5-6-10

Daily Forex Market Commentary

The U.S. dollar and the Japanese yen were the big winners today with the huge flight to safety that occurred. Gold also saw a considerable gain today, indicating investors are looking for even more safety than the typical safe havens of the greenback and yen.

The Japanese yen was up over 1,000 pips against some of the other major’s in the course of today’s trading session. Gold was up around $22 an ounce today as investors flocked to it as a source of safety amidst the current market turmoil.

Stocks:

On Wall Street today stocks literally took a beating. The U.S. stock market had one of its worse days ever. The Dow Jones industrials dropped nearly 1,000 points in 30 minutes on the back of concerns that Greece’s debt problems could slow world financial recovery.

The Dow managed to recoup much of its earlier losses but it still closed down nearly 348 points. The big 3 U.S. stock indexes all lost 3% or more today in trading that was reminiscent of the 2008 financial crisis.

The Dow closed down 347.87 points, or 3.2%, the S&P 500 was down 37.72%, or 3.24%, and the Nasdaq lost around 82 points, or 3.4%

Currency in focus: GOLD and GBPJPY

The recent daily spot Gold chart has provided a number of quality pin bar setups with the most recent one occurring just yesterday.

Notice in the chart below we have had two recent quality bullish pin bars that could have provided great entries into the recent bullish momentum of Gold. Also note that the most recent upside run was kicked off by a very nicely formed bullish pin bar.

For more pin bar trading education please click here: pin bars from key levels

GBP/JPY:

The GBPJPY also provided a recent pin bar setup that could have gotten you in on today’s big market sell-off. Notice the bearish pin bar that formed on 4/30. This pin bar showed clear rejection of the strong horizontal resistance near 145.00.

We covered this setup a few days ago in our member’s forum daily commentary, check it out by becoming a member and getting chart analysis on a minimum of 4 currency pairs each day.

For a more in-depth analysis of the major FX pairs as well as price action training, please check out my forex trading training course.