In this week’s market snapshot, we take a look at five markets with profit potential. We’re going to spend no more than 30 seconds on each pair. Let’s get to it.
The Aussie has retested the 0.7700 level twice on the weekly chart, and has now fallen away from that zone decisively. The bears appear to be well in control.
Trade idea: Sell rallies. I’m interested in some 4-hour moves, aiming to short any bounces in price followed by continued weakness. Target 0.7400 and 0.7170.
Has Cable finally broken out of the range it’s been in? Trading GBPUSD directly isn’t as clear cut as trading GBP crosses at the moment, and this breakout might be an excellent indicator to look for GBP strength elsewhere.
Trade idea: GBPNZD and GBPAUD in particular, are looking very strong at the moment. Their moves have come from AUD and NZD weakness. With that weakness set to continue, could we look at GBP strength now to continue those rallies?
The EURUSD head and shoulders has invalidated by price breaching and closing well above the neckline (blue arrow). Where to for the shared currency now? It’s this trader’s opinion that we’re in for a whole lot of nothing, as has been the case since mid-June.
Trade idea: Look elsewhere. On a shorter-term time frame, consider trading a long or short on a breakout of the red arrow range I have drawn (1.1860 and 1.1760 respectively.)
The Kiwi managed to close below 0.6850, an important level, on the weekly timeframe. The close below support suggest a lack of buying interest, and therefore further downside to come.
Trade idea: Sell on a break of last week’s low, or wait for this week’s candle to establish and sell on a break of that low. Target 0.6700 and 0.6400.
The AUDCAD has tested a level not seen since January this year; 0.9650. It’s also printed a bullish-looking pin-bar at that level, suggesting that buyers scooped up AUD’s and sold their CADs on Friday.
Trade idea: I’d like to see the buying continue. We have resistance at 0.9700 which means that buying above the pin-bar, with a stop below its wick results in an unacceptable reward/risk reward ratio if you target 0.9700. The solution is either to ignore that level and target something higher, or wait and see if price busts through 0.9700 and we have a major reversal in play.