Weekly Snapshot | Oct 23 – 27

We’re going to spend 30 seconds each on eight different markets today, all of which show profit potential. In no particular order, let’s get to it.

USDJPY

I wrote extensively about USDJPY a couple of weeks back, and it looks like the bulls did win out as I expected. Price is now right up against resistance at the 114.00 – 114.30 mark.
This is a lovely spot for a reversal, but given how Friday’s price movement showed a lot of positive USD momentum, I think we’re in for at least one more test of this level before we have any idea of what’s next.

Trade idea: I’m expecting another stab up. How price reacts at that level will tell us whether we should be buying into strength or looking to fade the move and short. We need to wait for now.

GBPUSD

Trading Cable hasn’t been too easy of late as price continues to tighten up. I think we’re seeing wedge-type structure on the daily timeframe.

Trade idea: Wait for a break to the up- or downside. Wait for the retest and bounce off the outside of the wedge. We can target 1.3580 to the upside or 1.2800 to the downside.

EURUSD

The EURUSD has been trading in an exceptionally tight range over the last while. One of the members in our trading room pointed out the potential head and shoulders formation setting up on the pair last week.

Trade idea: I would need to see the right shoulder complete before considering a short. Furthermore, I would like a break and retest of the neckline from below to pull the trigger when my money is on the line. Having said that, the H&S we see here really does seem to this trader to be about the only structure that makes any sense on the shared currency.

Targets down to 1.1350 – 1.1300, 370 to 400 pips from the neckline.

AUDNZD

The AUDNZD blasted right through resistance at 1.1130 on Thursday last week – the bulls look to be firmly in control.

Trade idea: I’d like to see some profit-taking at these levels, allowing price to drift back down to the 1.1130 zone before the same bulls step in again. If that happens, I’ll be buying a bounce at 1.1130 or thereabouts, targeting the current highs of 1.1260

NZDUSD

The Kiwi took a beating last week. I’m keen on selling a rally (if it gets back up there).

Trade idea: If price manages a retrace back to 0.7060 area, and starts rejecting that level, I’ll be looking for a short trade. This is the kind of trade that I would attempt to hold for the long-term, potentially targeting the 2015 lows all the way down to 0.6250 (700 pips away).

EURGBP

Are we looking at a double-top formation on the EURGBP? I’m considering this a market that made a strong move down, followed by a retrace, and is now poised to resume that move. Our entry signal might be the double-top we’re seeing.

Trade idea: I suspect we’ll see a retrace today after Friday’s big move and I will consider short positions tomorrow, after the Asian session. If price continues to trade higher, the short setup is invalidated.

GBPAUD

There is a lot happening on the GBPAUD chart above. I see price being squeezed by horizontal support and a downward sloping trendline. Price managed to close well below the lows of support on Thursday last week, only to see a total reversal and have price close back strongly above support, and back inside the consolidating wedge. I think the buyers aren’t done here.

Trade idea: I’d like to see price break the upside now before I go long. A break and potential retest from above sets up a lovely long opportunity.

EURNZD

Our final Kiwi related pair, the EURNZD, is also looking good for a buy.

Trade idea: I’d like to see a retrace and bounce at either 1.6740 or 1.6620 to go long. Target the recent highs, 220 to 300 pips away.

Leave a Reply