We have had three days of USD strength this week. The move upward has been slow and steady and we may have another day of the same before we encounter the NFP number on Friday. Even the dismal ADP Nonfarm Employment Change today didn’t cause USD weakness.
The GBPUSD sold off early in the U.K. session and retraced about a third of the move before rolling over again. A short was taken in the U.S. session overlap risking 20 pips for a potential 40 pips to our daily target at 1.2334. Price moved lower quickly, pulled back for one candle and continued lower into the U.K. close… reaching our daily target just in advance.
As long as USD strength continues, I will be looking for EURUSD and GBPUSD short setups and looking to fade any rallies. With the current euro weakness, the EURJPY is worthwhile watching, particularly during a “risk off” sentiment day. The pair can snap back quickly, so it’s not without added risk.
Good luck with your trading!
