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!
