I plan my trading for the week ahead each weekend. Here are the Forex trading opportunities I will bestalking this week.
Note that this is my current view, but if market conditions change my view can change too. Generally I will trade in alignment with what I have noted here, though I will wait for a set-up before I enter. I base my view on technical and fundamental information. This is my beliefs and you are welcome to have opposite ones. Having a plan is more important than the actual direction for me.
- Sell DXY Trend – MT is bear normal. The dollar index is trading below the key .92 level. We still need to be careful of a reversal here but for now we can remain bearish. The picture has not been pretty for the USD with a second hurricane (Irma) heading towards Florida with damage estimates in the billions. This, along with the weak data has made it highly unlikely that there will be another rate hike by the Federal Reserve in 2017. We have another potential missile test by North Korea this Saturday. On the positive side, president Trump has managed to solve the debt ceiling issue, so that should fall off the radar for a couple of months.
- Buy GBP/USD. Trend – MT is bull normal. Sentiment has turned positive towards the GBP, predominately on USD weakness and we are back in a bull market type. Brexit concerns do remain, but for now we can look to buy the pair. There is lots of UK data this week including the BOE’s monetary policy announcement.
- Sell USD/JPY. Breakout – MT is bear normal. Geopolitical tensions with North Korea, falling US bond yields and the weak USD have driven the pair below the key 108 level. Look to sell but careful of a reversal here.
- Wait AUD/USD. – MT is bull normal. The Aussie is up on the back of optimistic comments from the RBA and the weak USD. Of note, we have formed a bearish hammer off resistance so the technical pattern is suggestive that we may see a reversal here. Perhaps best to wait.
- Buy EUR/USD. Trend – MT is bull normal. The Euro continues to rise on the back of both a weak USD and a hawkish sounding ECB. Look to buy, but careful of a further sell-off from the key 1.20 level.
- Wait NZD/USD. – MT is sideways normal. NZD rose strongly on Friday, but ended the day giving back much of the gains. The rise was mostly on the back of weak USD sentiment, but concerns remain for the kiwi given the recent poor data and uncertainty around the upcoming election. On the plus side the latest dairy auction saw prices rise slightly
- Sell USD/CHF. Trend – MT is bear normal. The downtrend resumed last week on geopolitical risk, stronger EUR sympathy and USD weakness. We are now trading right at key monthly support (for the third time) so some caution required.
- Sell USD/CAD. Trend – MT is bear normal. The BOC surprised markets with another rate cut last week and the pair fell rapidly on the news. We had a Friday bounce on slightly weaker than expected data and some profit taking, but can remain short for now.
- Sell EUR/GBP. Contrarian – MT is sideways normal. We have reversed off major resistance at 0.92 and contrarian shorts are in play.
Crosses
- Wait EUR/CHF. – MT is sideways normal. Wait.
- Wait AUD/JPY. – MT is sideways normal. Wait.
- Sell NZD/JPY. Trend – MT is bear normal. Continue to sell.
- Wait GBP/JPY. – MT is sideways normal. Wait.
- Wait EUR/JPY. – MT is sideways normal. Wait.
- Buy CAD/JPY. Trend – MT is bull normal. But we are reversing off key resistance, buy on a dip only.
- Wait CHF/JPY. – MT is sideways normal. Wait.
- Buy GBP/NZD. Trend – MT is bull normal. Continue to buy.
- Buy EUR/NZD. Trend – MT is bull normal. Continue to buy, but careful of topping action here.
- Buy AUD/NZD. Trend – MT is bull normal. Continue to buy.
- Wait EUR/AUD. – MT is sideways normal. Wait.
- Wait GBP/AUD. – MT is sideways normal. Wait.
- Sell AUD/CAD. Trend – MT is bear normal. Continue to sell.
- Sell GBP/CAD. Trend – MT is bear normal. Continue to sell.
- Sell EUR/CAD. Trend – MT is bear normal. Contine to sell.
- Sell NZD/CAD. Trend – MT is bear normal. Continue to sell.
- Wait GBP/CHF. – MT is sideways volatile. Wait.
- Buy CAD/CHF. Trend – MT is bull normal. Continue to buy, but be careful of a reversal here.
- Sell NZD/CHF. Trend – MT is bear normal.Continue to sell.
- Wait AUD/CHF. – MT is sideways quiet. Wait.
Other Markets
- Buy Gold. Trend – MT is bull normal. Continue to buy.
- Wait Oil. – MT is sideways normal. Wait.
- Wait S&P 500. – MT is sideways normal. Wait.
- Wait DAX. – MT is sideways normal. Wait.
- Wait T-Notes. Trend – MT is bull normal. Continue to buy.
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Economic calendar for the week ahead:
(MT = Market Type: Click for more information on market types.)
Trend: Market is trending in the direction I have listed and I expect it to continue.
Reversal: I am looking for a reversal against the current trend.
Breakout: The currency pair is breaking out of a range.
About the Author
Sam Eder is a currency trader and author of the Definitive Guide to Developing a Winning Forex Trading System and the Advanced Forex Course for Smart Traders (get free access). He is the owner of www.fxrenew.com a provider of Forex signals from ex-bank and hedge fund traders (get a free trial). If you like Sam’s writing you can subscribe to his newsletter.