Forex Trading Opportunities for the Week Ahead 27 November: FXRenew

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 struggled in Thanksgiving week mostly on the back of concern over the trajectory of rates in 2018. While a rate hike in December is a given, there is worry that there will be limited follow through next year considering the weak inflation outlook. We have broken out into a bear MT and a retest of the low at 91.00 should be expected. Watch for news on tax reform in the coming week. If it’s positive we could see a reversal of the current downtrend.

• Buy GBP/USD. Trend – MT is bull normal. The GBP has broken out into a bull MT on the back of USD weakness, an acceptable UK budget and some optimism around Brexit talks. We had been stuck in a sideways MT since early October and once there is a breakout from such persistent sideways MT’s there is often a nice expansion into a trend. Look to buy.

• Sell USD/JPY. Trend – MT is bear normal. The bear market continued, initially on some nervous price action in stocks. Stocks recovered strongly into the weekend, and we have seen the momentum slow. But with USD weakness and the downtrend clearly intact, we can continue to sell.

• Wait AUD/USD. –  MT is sideways normal. There was some positive news with the RBA saying that the next move in rate hikes will be higher. But the market does not anticipate this will happen in a hurry. AUD still remains one of the weaker currencies across the board, though USD weakness has pushed the pair back into a sideways MT. Iron Ore has been rising which is also supportive of AUD.

• Buy EUR/USD. Trend –  MT is bull normal. The EUR ended as the star performer for the week on the back of positive ECB speak, more good economic data and a slight reduction in political uncertainty in Germany. There was some thought that a new election may need to take place after one of the main potential coalition members said it would go into opposition. But the parties are now back at the negotiating table which is seen as a positive. EURUSD is looking good for a move back to the key 1.21 level.

• Wait NZD/USD.  –  MT is sideways normal. The kiwi has bounced off the key 0.68 level for the second time on the back of USD weakness. The bounce is mostly a technical phenomenon with dairy prices down over 3% for the second time in recent memory. Wait for now, but a move back above 0.70 would look good if USD weakness persists.

• Sell USD/CHF.  Trend – MT is bear normal. Risk aversion and USD weakness took us below the 0.9850 level outlined in last weeks report. Continue to sell.

• Wait USD/CAD. – MT is sideways quiet. Despite USD weakness and a rising Oil price, the CAD has remained range bound. Concerns exist over both NAFTA talks and weak economic data. The lack of momentum despite the rise in Oil should be seen as a bearish sign (ignoring good news).

• Wait EUR/GBP.  – MT is sideways normal. The pair remains range bound. Wait for now.

Crosses

• Wait EUR/CHF. – MT is sideways normal. Wait.
• Sell AUD/JPY. Trend – MT is bear  normal. Continue to sell.
• 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.
• Sell CAD/JPY.  Trend – MT is bear normal. Continue to sell.
• Wait CHF/JPY.   – MT is sideways quiet. Wait.
• Buy GBP/NZD.  Trend – MT is bull normal. Continue to buy.
• Buy EUR/NZD. Trend – MT is bull normal. Look to buy.
• Wait AUD/NZD. – MT is sideways normal. Wait.
• Buy EUR/AUD. Trend – MT is bull normal. Continue to buy.
• Buy GBP/AUD.  Trend – MT is bull normal. Continue to buy.
• Buy AUD/CAD. Reversal –  MT is bear normal. Contrarian buying opportunity.
• Wait GBP/CAD. –  MT is sideways normal. Wait.
• Buy EUR/CAD.  Trend –  MT is bull normal. Look to buy.
• Wait NZD/CAD.  – MT is sideways normal. Wait.
• Wait GBP/CHF. – MT is sideways normal. Wait.
• Wait CAD/CHF. – MT is sideways quiet. Wait.
• Sell NZD/CHF.  Trend – MT is bear normal. Continue to sell.
• Sell AUD/CHF.  Trend – MT is bear normal. Continue to sell.

Other Markets

• USDSGD Trend – MT is bear normal. Look to sell.
• USDCNY Trend – MT is bear normal. Look to sell.
• Wait Gold. – MT is sideways normal. Wait.
• Buy Copper. Breakout – MT is bull normal. Look to buy.
• Buy Oil. Trend – MT is bull normal. Continue to buy.
• Buy S&P 500. Trend – MT is bull normal. Continue to buy.
• Wait DAX. – MT is sideways volatile. Wait.
• Wait Nikkei. – MT is sideways normal. Wait.
• Wait T-Notes.  – MT is sideways normal. Wait.

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Economic calendar for the week ahead:

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(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.