Archives for November 2020

Last week was the slowest and most boring trading that I have seen in a long time. It appeared that a lot of institutional money remained on the sidelines awaiting confirmation of direction. The USDJPY was my favourite pair to trade last week but it’s moves were minimal.

On Monday to begin this week, we had for a third Monday in a row optimistic vaccine news, this time from AstraZenica.

The USD moved higher on the day and a short was taken in the AUDUSD risking 15 pips for a potential 37 pips to our daily target at .7279.

The pair had made a series of lower highs and the strong USD led us into our short trade. It was the surprisingly high U.S. PMI numbers that jolted the market and the majors began to take off.

Today the risk-on sentiment continued for a second day. Our first trade was the USDJPY long… risking 15 pips for a potential 41 pips to our daily target at 104.68.

Price had moved lower after the U.K. open and found a bottom. We waited to be convinced that the move higher was worth the risk. Price moved higher retracing its entire move lower for the day and reached our target early in the U.S. session overlap where we exited.

As the S&P 500 Futures pointed to a .75% jump at the open today coupled with a move higher in oil, we went short the USDCAD risking 15 pips for a potential 53 pips to our daily target at 1.3016.

Price dropped to its Asian session low where we gave it room to retest this level. As the pair moved lower, long lower wicks began to form under the candle bodies and we tightened up our profit stop. We closed the trade in advance of the U.K. close.

It would appear that President Trump is beginning to accept the election outcome and President-elect Biden is appointing former Fed Chair Janet Yellen to be at the helm of the U.S. Treasury Department.

The U.S. Thanksgiving holiday is on Thursday and Friday is likely to be very light on volume.

Good luck with your trading!

Traders are struggling with USD strength and weakness. The equity markets are rising one day over optimism for a Covid 19 vaccine then falling the next over concerns about the rising number of new infections, closures, new restrictions and the potential impact on the economy.

Both ECB President Lagarde and Fed Chair Powell have both reiterated concerns this week about how long it may take before their economies may recover. Britain has not yet been able to come to a formal Brexit deal with the E.U. but the market seems to think that a deal will be made by year-end so the GBPUSD has been moving higher this week.

Today, early in the U.S. session overlap a short was taken in the USDJPY risking 11 pips for a potential 30 pips to our daily target at 103.60.

Price formed a reversal pattern and moved lower through its Asian session low, but stalled a few pips ahead of our daily target at 103.60. Our trade was closed for a modest gain.

The recent break below 104.00 in the USDJPY opens the door for bears to test the October’s lows in the 103.20 area. Bulls will want to get back above the 104.00 figure.

The EURUSD continues to oscillate between 1.1600 and 1.1900. Currently a break below 1.1725 would be bearish and a break above 1.1920 would be bullish.

Good luck with your trading and stay healthy!

As mentioned last week, I expect President Trump to go down fighting with about 10 weeks left in his term.

The news of a coronavirus vaccine this week from 3 different companies is giving traders optimism that our economies will move back toward recovery. As complicated as vaccine approval and delivery is, this is a huge step forward in a time when a second wave of infections has been sweeping across Europe, the U.K. and North America. It seems the President was correct when he stated that a vaccine announcement would be coming in November.

The market really can go either direction at this turn while we await President-elect Biden’s certification. Of interest to traders is the U.S. 10Y approaching 1% while an equivalent Italian bond yield is .75%. This can be considered USD positive in my opinion. It is prudent not to have a strong opinion on the USD mid or longer term as an intraday trader… but to trade based upon it strength or weakness at the time.

On Wednesday with USD strength, a short was taken in the GBPUSD risking 20 pips for a potential 74 pips to our daily target at 1.3159. Price moved lower and found a bottom at the European close where we exited.

Thursday we took 2 trades.

After rising for most of the session the USDCAD formed a 3 candle reversal pattern and a short was taken risking 20 pips for a potential 70 pips to our daily target at 1.3052. Price moved lower but failed to remain below the 1.3100 figure and the trade was closed.

Also today while the EURUSD was strengthening, the GBPUSD was weakening… a EURGBP long was taken risking 9 pips for a potential 18 pips to our daily target at .8977.

Price moved higher and accelerated through our daily target so we placed our profit stop at .9877 as price moved higher. Our hope was that price would move to the psychological big figure of .9000. Price fell a bit short of our bonus target and we exited the trade.

The GBPUSD will remain very sensitive to Brexit news with the current deadline set for Sunday. Use your stops prudently as this pair could explode 100 pips within a 5 minute period or less.

Good luck with your trading and stay healthy!

It’s been a busy week with the U.S. election result foremost on most traders’ minds. We will have to wait awhile longer before we know the outcome.

The markets are active again but the setups are not ideal to my eyes. Today in the “risk on” environment and weaker USD, a long was taken in the NZDUSD risking 14 pips for a potential 29 pips to our daily target at .6760.

Price moved sideways after the entry before moving higher through yesterday’s high and to our daily target. Our targets are a little on the conservative side due to the reduced volumes leading up to the election but being conservative in a potentially very volatile environment is prudent.

A likely winner of the election will be announced in the coming days and if it is not President Trump, I expect he will not go down without a fight.

Sooner or later the market will focus again on the coronavirus infection rates/ lockdowns etc. and the ever moving Brexit deadline…currently set for November 15th.

The 30 day period after a U.S. election can be a very rewarding period for traders.

Good luck with your trading!