Initial move on GBPUSD and EURUSD during the London open was to continue the down move which got going in latter half of the asian session. About 2 hours after the london open, an asian sovereign was reported as buying GBPUSD and the pair shot up from 1.6050 to back above the 1.61 handle, see here. Drawing a fibonacci retracement from the 1.6158 high seen at the 5pm Sunday night open to the 1.6040 lows achieved during the 1st half hour after the london open, as well as another fibonacci retracement drawn from the pre-Frankfurt swing high at 1.6130 to these same lows. We can see that the 61% of the larger move and the 78% of the smaller move created an area of confluence, creating a low risk entry area. This was also a standard sweep of the handle, and if no extension of this move down was seen, a trader could at least expect to see some retracement off the burst higher created by the ACB. Of course you might think you are positioning yourself against the trade of the Big Fish, but you do not know for sure if they were taking profit, scalping, or what, nor where their stop loss is if it is a new entry. This is the type of trade to look for, unfortunately after watching rather lackluster price action for 2 hours, I was not around when this occurred, but wanted to make a note of this type of setup so others can get an idea of what to look for.
Alot of data out of the UK this week: CPI, Retail Sales & the UK Employment data, also CPI and Retail Sales out of the US. Not like the start of the month but some decent big reports.
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