Archives for September 2018

The USD showed moderate strength today and as the U.S. session got underway, an entry long was found on the USDJPY risking 11 pips for a potential 39 pips to our daily target (not shown) at 113.82.  Price moved up but failed twice to close above its Asian session high and left a long upper wick.  We closed the trade at the European close not wanting to give back any more pips.

We now enter the last quarter of the year with a very strong U.S. economy continuing and another interest rate increase expected in December.  The E.U. and U.K. Brexit agreement remains unresolved.  Inflation is appearing in Europe with German inflation y/y for September at 2.3% confirming the E.C.B.’s recent hawkish tone.  The impact from the China U.S. trade tariffs are keeping the market unsettled some days yet appear to be completely disregarded other days.

Looking forward to final push.

Enjoy your weekend!

The USDJPY found its low early in the U.K. session and completed a bullish reversal pattern.  An entry long was taken risking 11 pips for a potential 33 pips to our daily target at 112.98.  Price gradually climbed to its Asian session high as the U.S. session was getting underway.  With U.S. economic news releases pending, we locked in profit and subsequently closed the trade at our daily target, as the previous candle had a long upper wick and the 113.00 figure sat immediately above.  As it turned out… the USD continued to strengthen and the pair continued to climb much higher without us.

The U.S. economy continues to strengthen but the market lately has had a tendency to focus on U.S. negatives as opposed to U.S. positives.  It will be interesting to see how the final quarter of 2018 unfolds.

Good luck with your trading!

Although the EURUSD popped upward last week and closed above 1.1725, it hasn’t had much follow-through since and has not closed above 1.1800 since May.  With a slightly positive USD today awaiting the Federal Reserve announcement, we went short after the second failed attempt of the EUR to stay above its Asian session high.  A setup risking 10 pips for a potential 72 pips to our daily target at 1.1694 is hard to pass on.

Price moved down but did not take out yesterday’s low before the U.S. open where our profit stop was executed.

Unfortunately the EURJPY didn’t set up at the same time or we would have taken it – as it has been a bigger mover of late.  With the Fed interest rate announcement and accompanying statement today, we can move on to other central bank speeches as the week continues.

Good luck with your trading!

 

It’s been very interesting watching the mighty USD fade in strength recently, despite the fundamentals of a very strong U.S. economy and rising interest rates.  Some critical levels are being taken out and the oversold Euro and Sterling have begun to move up.  Brexit issues, a focus on Italian debt or any number of other issues could bring the Euro and Sterling back down, but in the meantime an appetite for risk has prevailed.

As the U.K. session got underway the EURJPY moved higher then pulled back to retest its Asian session highs, then moved higher… where an entry was taken risking 22 pips for a potential 66 pips to our daily target at 1.3204.  Price continued upward and our target was realized as the U.S. session began.

A second trade was taken today as the USD remained weak and “risk on” remained as evidenced by global equity markets. This helped push the USDJPY higher.  Risking 13 pips for a potential 40 pips to our daily target an entry long was taken.  Price moved up but when a long upper wick appeared, we moved our profit stop up and the next candle closed the trade.  One of my students rode it right to the daily target and got an extra 10 pips with an identical entry. ( Congratulations Juerg!!!)

On Wednesday we took the AUDUSD long during the early part of the U.S. session risking 10 pips for a potential 25 pips to our daily target at .7271

As price moved higher we placed our profit stop at plus one pip, which held after a minor pullback for 2 candles… before price moved higher into the U.K. close.

The EURUSD, EURJPY and GBPUSD have all moved higher above technically significant levels on the daily charts.  Will price retest these levels or will price continue higher?  We will have to see how long this “risk on” appetite continues.  Keep an eye on the 10 year yield, equity markets and USD index for some clues.  Keep your stop losses tight and lock in your profits as the market moves in your favour.  The potential for high volatility exists  as the battle between USD bulls and bears heats up.  It won’t take much to take the wind out of the sails of the EUR and GBP – which is why we trade on technicals but pay close attention to the fundamentals.

This summer President Trump said that he wants a weaker USD.  He also made it clear again today that he wants the OPEC countries to lower the price of oil. .

I will be away tomorrow but back next week.

Good luck with your trading!

 

 

 

 

 

Mondays tend to be difficult days to trade.  On rare occasion they can be rewarding, but they tend not to be revealing of the coming week’s bias.  Lately, by being very selective, I have found fewer trades each week – partly because I’m a USD bull.  The market of late has not entirely agreed with me and it’s not uncommon to see 3 bearish days in any given week for the USD.  As the market has started to shift a bit away from USD strength, I’m prepared to very selectively do the same… as it’s never a good idea to fight the market.

Today was a day of USD weakness, but not one of “risk off”.  There was a fairly uniform move against the USD today and the EURJPY was preferable to me over the EURUSD because it had pulled back after breaking above its Asian range.  The EURJPY offered an entry with a small stop loss of 16 pips for a potential 72 pips to our daily target at 131.24.  Price moved up into the U.S. open and without any U.S. economic news releases, price moved higher, but was unable to climb above the 131.oo figure.

The EURJPY tends to be a  very active pair and not nearly as erratic in its moves now, as it has been historically.  It certainly is worth a look.

Mario Draghi will be talking twice this week, so trade accordingly.  Any positive news regarding Brexit can cause large up moves for the GBP and EUR. The trade tariff threats continue between the U.S. and China… which some days the market seems more focused on than other days.  Australia and Japan both have monetary policy statements this week.  It will be interesting to see if Britain can continue its recent positive economic progress.

Good luck with your trading!

The soft USD this week allowed the EURUSD to move up to a technically significant level for traders on the daily chart. With price failing to stay above it, coupled with a stronger USD on Friday, we were able to find a short… risking 12 pips for a potential 78 pips to our daily target at 1.1633.  Price moved down and drifted sideways during the first half of the U.K, session – testing Thursday’s high.

We chose to keep our stop loss very tight and as price moved down to its Asian session low just in advance of the U.S. open, we tightened our profit stop further.  Price moved higher at the open and closed our trade before descending significantly lower after the news.

It wasn’t the easiest week to find trades, but we don’t need to find them everyday.  Patience and discipline rewards traders over time.

Enjoy your weekend!