Archives for January 2019

Fed Chairman Powell’s dovish wording weakened the USD yesterday. Although the reaction amounted to a quick abrupt sell-off of the dollar, it wasn’t an extreme move. The U.S. economy remains stronger than that of the E.U., U.K. and Japan.

The majors are at or approaching critical technical levels. Tomorrow it will be interesting to see where the pairs close the week after we know the NFP and ISM Manufacturing PMI results.

Today as the EURUSD was unable to move higher early in the U.S. session, a short was taken risking 10 pips for a potential 53 pips to our daily target at 1.1432.

Price moved lower but stopped before reaching our target and we closed the trade at the U.K. close. The pair continues to range between 1.1300 and 1.1500.

Be extra cautious tomorrow and anticipate volatility.

Good luck with your trading!

Recent amendments have done little, time is running out and unless the U.K. can take active measures to prevent a “no deal” Brexit it will leave the EU without a deal on March 29th. Last week’s optimism and rise in the GBP faded today.

As the U.K. session got underway the GBPUSD climbed above its Asian high and stalled. Sellers entered and began pushing price down as evidenced by the long upper wicks and lower highs forming. A short was taken and the critical level today to get through was around 1.3060. If this level gives way, price may retest it but if sellers enter again, I expect 1.3000 to be targeted and a potential move down to test the 1.2900 level.

Unable to make it through the 1.3060 level by the London close, we exited the trade at the end of the session.

However, if profound progress is made regarding Brexit, buyers will enter… and a test of last week’s enthusiastic high at 1.3216 is in sight.

The markets await for any clues from Jerome Powell today regarding any clues as to the next rate hike this year. The U.S. – China trade talks resume in Washington today. Oil is rising as Venezuala’s oil supply to the market could be cut off. Non-farm employment change awaits us on Friday.

Good luck with your trading!

The USD closes the week being sold and gold moved closer to $1300 oz.

The USDJPY has not been over the 110.00 yet this year. It rose early in the U.S. session to 109.95 and ran into sellers and started to reverse lower. A short was taken risking 6 pips for a potential 49 pips to our daily target at 109.40.

Price first moved down to close beneath its Asian high and we allowed for a retest of this level. Price moved lower and paused at yesterday’s high, then dropped further. Buyers emerged as evidenced by the long lower wick candle as it tried to move to its Asian session low. We moved our profit stop down and the next candle closed our trade.

With the USD being on its back foot and gold moving up strongly, it was interesting to see the equity markets and U.S. 10 year yield move upward. Perhaps a bigger surprise has been the strength of the GBP this week…although I haven’t found a comfortable entry yet to go long. The sentiment this week is positive but sentiment can change quickly.

Next week will be interesting as we approach the deadline for the U.S. -China trade talks followed by NFP on Friday.

Good luck with your trading and enjoy your weekend!

European bourses moved higher as did the FTSE in London going into the U.S. session. An appetite for risk continued as the Dow surged higher after the opening, but it subsequently reversed. The USDJPY found sellers as it moved to test the 110.00 big figure.

A short was taken risking 14 pips for a potential 55 pips to our daily target at 109.31 which corresponded with its Asian session low. Price came down sharply going into the London close where we exited the trade ahead of our daily target.

The GBPUSD put in a solid gain today as fears abated (for now) about a hard or “no deal” Brexit. The U.K. is posting some encouraging economic numbers and the oversold GBPUSD had legs to the upside today. A critical level from the Daily chart around 1.3080 contained price for today. Volatility remains potentially very high until Brexit is resolved, but if it gets above 1.3100, I expect it will be attracting some position longs and if 1.2900 gives way and Brexit politics weigh negatively, I expect more shorts entering.

Tomorrow we have French and German PMI releases but the major event risk will be Mario Draghi’s speech and how dovish his comments are interpreted. Be careful trading the EURUSD in advance of Draghi’s comments.

Good luck with your trading!

Overall the Euro and Sterling are not looking good at the moment and the USD is recovering well this week – as trade talks with China continue to sound positive.

As the U.S. session got underway, the EURUSD broke lower and a short was taken risking 8 pips for a potential 48 pips to our daily target at 1.1349. Price moved down through its Asian session low but had difficulty getting through yesterday’s low. It began to reverse mid-figure leaving a long lower wick candle. We moved our profit stop just above the candle’s high and the next next candle closed the trade.

Until the U.S. – China trade talks and tariffs are finalized, the markets will be potentially very volatile, so trade very cautiously… and always always always trade with a stop loss!

Enjoy your weekend and good luck with your trading!

The EURUSD was more appealing with a risk of 13 pips for a potential 75 pips to our daily target at 1.1338. An entry short was taken, price moved down to yesterday’s low where it began to retrace in advance of the U.S. open closing our trade for modest gains well short of our target.

The AUDUSD and NZDUSD were very active today but I didn’t like the reward for the risk in either pair.

There are some mixed signals appearing once again which makes trading trickier and riskier than usual. The GBPUSD is extremely volatile, so be very cautious with it. There is some appetite for risk today but if this changes and U.S. equity markets start to decline substantially watch for flows to the safe haven yen. There are some major economic news releases tomorrow to be aware of.

Good luck with your trading!