A big data week that may shape risk appetite

Last week: FX was fairly choppy for my trend trading algorithm last week as the US$ turned back up but there were still some TC signals albeit, many of them didn’t move too far: Cable = 90, A/U = 70, A/J = 100, E/A = 80 and USD/CAD = 130 with all signals now closed off.

Next week:

There are three Central Banks to report interest rate decisions, FOMC, RBNZ and the BoJ, and this could help shape the next directional move for the US$ and, also, how broader-based risk appetite unfolds from here.

US$: this has closed higher again for the week and an update on the FX indices can be found through this link.

USD/JPY: I noted last week to watch for any bullish follow-through on the U/J following the print of last week’s bullish reversal ‘Inverted Hammer’ and we got that in spades. Watch for further Yen weakness across all JPY pairs now following last week’s BoJ announcement about negative interest rates.

GBP£: a number of GBP charts are shaping up with interest and one has to wonder if this news release has just underpinned the GBP£ somewhat until the Brexit referendum. I’ll be on the lookout for any GBP strength in coming sessions.

S&P500: this index has tested an upper Bull Flag-style trend line and the key 2,100 level but closed the week below both. Mixed earnings is making for hesitation with this most recent stock rally. Watch for any make or break of these levels in coming sessions though as it getting close to do or die time here. Any bullish breakout will have me looking for a move to 2,500:

S&P500 daily:

S&Pdaily

S&P500 weekly:

S&Pweekly

S&P500 monthly:

S&Pmonthly

DJIA weekly: this Bull Flag breakout looks to be continuing:

DJIAweeklyRussell 2000 weekly: as does this Bull Flag on the US stock’s ‘Canary in the Coal Mine’:
RUTweekly

Silver Spot weekly: this is looking like a reversal is underway and note the uptick with buying momentum:

SIweekly

VIX weekly: there is still plenty of complacency as the Fear Index trades below 14 and prints another bearish weekly candle:

VIXweekly

Bank Holidays: take note of the holiday Monday for AUD and NZD and Friday for JPY.

NB: I am away this w/e and, also, for a month from mid week. TC blog updates will be brief and few during the next five weeks.

Trading Calendar ‘High Impact’ data Items to watch out for:

  • Sat 23rd:  Day 2 ECOFIN Meetings.
  • Mon 25th: AUD, NZD Italian Bank Holiday. EUR German Ifo Business Climate.
  • Tue 26th: USD Core Durable Goods. BoC Gov Poloz speaks. USD CB Consumer Confidence.
  • Wed 27th: AUD CPI. USD Crude Oil Inventories and FOMC.
  • Thurs 28th: NZD RBNZ Rate StatementJPY BoJ Rate Statement & Press Conference. USD Advance GDP & Weekly Unemployment Claims.
  • Fri 29th: JPY Bank Holiday. CAD GDP.

FOREX:

EUR/USD: This pair is still ranging within a daily chart triangle. Note the lack of momentum on the daily and weekly charts though! Maybe this week’s FOMC will trigger something here.

As previously noted: Any bullish breakout above 1.15 would have me looking at the 1.18 S/R level in the first instance as this is just above the most recent HIGH and is a 38.2% fib level. After that I’d be looking at the 1.22 level as this is a congested zone holding the weekly 200 EMA, a previous monthly triangle trend line and the 50% of the weekly chart’s 2014-2015 swing low move.

The key levels to monitor on the EUR/USD include:

  • 1.12:        this is a major S/R level from the monthly chart as it is the 61.8% fib of the 2000-2007 swing high move.
  • 1.15:        a recent Double Top resistance level.
  • 1.18:        this is major long term S/R level (seen on the monthly chart).
  • 1.22:        weekly 200 EMA, a previous monthly triangle trend line and the 50% of the weekly chart’s 2014-2015 swing low move.
  • 1.045 /1.040: the recent & longer term support levels marking the lower boundary of a potential Bear Flag.

Price is still trading above the daily Cloud but below the 4hr Cloud suggesting choppiness.

The weekly candle closed as a bearish candle and this now confirms the bearish ‘Evening Star’ appearance.

  • I’m watching for any new TC signal and the triangle trend lines:

EUmonthly

EUweekly EUdaily EU4

EUR/JPY: this pair has bounced up off the monthly chart’s 50% fib support yet again and I’m still noting a bullish-reversal descending wedge on the weekly chart.

Friday’s BoJ activity helped this pair to trigger a new 4hr chart TC LONG signal but note the looming potential resistance from the combined 61.8% fib and key 126 level. The monthly chart reveals how significant this 126 level is and so cautious traders might prefer to wait for a close and hold above 126 before considering a longer term LONG trade.

Watch for any impact here from next week’s BoJ rate statement.

Price is now trading above the Cloud on the 4hr and in the bottom of daily Cloud which is a bullish shift.

The weekly candle closed as a bullish engulfing candle.

  • There is a new TC LONG signal here BUT watch the 126 level.

EJmonthly

EJweekly EJdaily EJ4

AUD/USD: Price traded up and then down last week. I’m still looking for a test of the 0.80 level as this is a psychological whole number level, previous S/R and the rough location for the junction of the bear trend line that has been in force since the decline started back in late 2012.

Price is still trading above the Cloud on the 4hr and daily charts which suggests LONG AUD/USD.

The weekly candle closed as a bullish coloured ‘Inside’ candle reflecting some indecision.

Despite the RBA being unhappy with this elevated level I would expect this pair to continue higher IF the S&P500 make any bullish breakout and continuation move.

  • I’m watching for any new TC signal on this pair and the 4hr chart’s support trend line.

AUmonthly

AUweekly AUdaily AU4

AUD/JPY: Price action is now up at a critical S/R level for this pair and is, also, close to triggering a new TC LONG signal.

The A/J got a boost from the BoJ on Frday and is now trading up near a major bear trend line (seen on the monthly chart), right on top of the monthly 200 EMA and just under the daily 200 EMA.

Price is trading above the Cloud on the 4hr and daily charts which suggests LONG AUD/JPY.

The weekly candle closed as a bullish candle.

Watch for any impact from the BoJ this week and, also, if stocks keep moving higher.

  • I’m watching for any new TC signal and the the bear trend line.

AJmonthly

AJweekly AJdaily AJ4

GBP/USD:

This pair might receive a boost from the President of the USA with his comments about any Brexit. Thus, I’m on the lookout for any bullish follow-through as price already trades up near the top of  the 4hr chart’s triangle trend line.

Bullish targets: The weekly and daily chart’s show that this smaller triangle is set within a larger descending wedge. Any bullish daily chart triangle breakout will have me focused on the 1.46 S/R level and, after that, the weekly chart’s wedge trend line. Any bullish weekly-chart wedge breakout would have me focused on the following levels:

  • the 1.50 S/R level and then,
  • the 50% fib near the weekly 200 EMA and 1.55 S/R level and then,
  • the 61.8% fib near the 1.60 S/R level and also near the monthly chart’s bear triangle trend line.

Bearish targets: any bearish daily chart triangle breakdown would have me focused on the following levels:

  • the 1.40 S/R level.
  • The 1.35 S/R level and GFC low region.
  • The 1.30 level which is near the monthly chart’s 78.6% fib (see monthly chart).
  • The 1.05 region which is near the monthly chart’s 100% fib (see monthly chart).

Price is trading above the Cloud on the 4hr and daily charts which suggests LONG GBP/USD.

The weekly candle closed as a bullish candle.

  • I’m watching for any new TC signal and the the triangle trend lines.

GUmonthly

GUweekly

GUdaily GU4

NZD/USD: Price retreated from the key 0.70 level last week but is still holding above a daily support trend line.

Price is trading below the Cloud on the 4hr and above the Cloud on the daily chart suggesting choppiness.

The weekly candle closed a bearish-reversal ‘Shooting Star’.

Watch for reaction from this week’s RBNZ rate statement.

Price action on the AUD/NZD pair has me open-minded about more of a pull-back on this pair.

  • I’m watching for any new TC signal.

KiwiMonthly

KiwiWeekly KiwiDaily Kiwi4

USD/JPY: The weekly 200 EMA has held price action up for over three years and has continued to exercise its support. Price bounced up from this level on Monday to hold within a recent trading channel. BoJ activity on Friday though resulted in this pair rallying up and out from this channel and back above the key 111 level.

Price is above the 4hr Cloud but below the daily Cloud suggesting choppiness.

The weekly candle closed as a large bullish candle.

The BoJ activity helped this pair to trigger a new TC LONG signal BUT this came came after a rather extended move higher. Thus, I’d rather wait to see if this continues and maybe even for the next new signal here.

  • I’m watching for any new TC signal.

UJmonthly

UJweekly UJdaily

UJ4

GBP/JPY: The monthly chart shows this pair pair holding above the 50% fib level.

Price has rallied up from the 154.50 S/R level and I’ll be watching to see if this can close and hold above the 167 S/R level.

Price is above the 4hr Cloud but below the daily Cloud suggesting some choppiness.

The weekly candle closed as a large bullish candle.

As with the USD/JPY, BoJ activity helped this pair to trigger a new TC LONG signal BUT this came came after a rather extended move higher. Thus, I’d rather wait to see if this continues and maybe even for the next new signal here.

  • I’m watching for any new TC signal.

GJmonthly

GJweekly GJdaily GJ4hr

GJ4hr

USD/CAD: Price has held below the 1.30 S/R level but found support from the monthly chart’s 50% fib level and it also remains within a descending trading channel.

Oil looks to be continuing on a bullish reversal shift and any new close above $45 would help to keep pressure on this pair:

Oil CL monthly:

CLmonthly

Price is trading below the Cloud on the 4hr and daily chart which is bearish.

The weekly candle closed as a bearish candle and still within the weekly Cloud.

  • I’m watching for any new TC signal on this pair, the 50% fib and the trading channel trend lines.

LoonieMonthly

LoonieWeekly LoonieDaily Loonie4hr

EUR/NZD: This pair continues to trade within a daily chart triangle and bounced up from the bottom trend line here at the start of the week. I’m watching these trend lines for any breakout and, also, the key 1.675 level.

Price is trading below the Cloud on the 4hr and daily charts which is bearish.

The weekly candle closed as a bearish coloured Doji candle reflecting indecision.

Watch for any impact from this week’s RBNZ rate decision.

  • I’m watching for any new TC signal and the triangle trend lines.

ENmonthly

ENweekly ENdaily EN4hr

GBP/AUD: This pair continues within a descending trading channel but has also held above the monthly chart’s 50% fib. This pair may also benefit from the US President’s recent Brexit comments.

Price is trading above the 4hr Cloud but below the daily Cloud suggesting choppiness.

The weekly candle closed as a bullish coloured ‘Inside’ candle reflecting indecision.

  • I’m watching for any new TC signal and the trading channel trend lines.

GAmonthly

GAweekly GAdaily GA4

GBP/NZD: This pair is shaping up as one of the more interesting pairs at the moment and I Tweeted as much on Friday.  In fact, it gave a great 250 pip trend trade after breaking up and out from the recent trading channel during Friday’s European and US sessions:

GBP/NZD 30 min chart:

GN30min

This bear trend line had been in play for the last 9 months and so this bullish breakout is worth noting, especially as this pair may also be a beneficiary of the recent US President’s comments. Price action stalled at the key 2.10 level and this will be the level to watch in coming sessions.

Watch for impact here next week with the RBNZ interest rate decision.

Price is above the 4hr Cloud but below the daily Cloud suggesting choppiness.

The weekly candle was bullish.

  • I’m watching for any new TC signal and the 2.10 level.

GNmonthly

GNweekly GNdaily GN4hr

EUR/AUD: The EUR/AUD is hovering above support from a triangle trend line but looking rather vulnerable.

Price is trading below the Cloud on the 4hr and daily charts which is bearish.

The weekly candle closed as a bearish candle.

  • I’m watching for any new TC signal and the triangle trend lines.

EAmonthly

EAweekly EAdaily EA4

EUR/GBP: This pair broke down below a weekly support trend line and has me now looking for a test of the major 0.75 area again as this is down between the 61.8% and 50% weekly fib levels.

Price is below the 4hr Cloud but above the daily Cloud so could be choppy.

The weekly candle was a bearish candle.

EGmonthly

EGweekly

AUD/NZD monthly: this bullish-reversal pattern looks to be developing nicely for now:

ANmonthlyCloud

Gold:  Gold stalled, once again, at the weekly 200 EMA. Friday was a particularly bearish day with US$ strength following the BoJ announcement. Price has not made a weekly close above the weekly 200 EMA in almost three years and so this remains as considerable resistance. The latest pull back from the weekly 200 EMA has set up a potential bearish H&S pattern on the daily chart giving traders a neck line trend line to monitor in coming sessions.

I’m still keeping an open mind with Gold and can see reasons for both weakness and strength with the precious metal.

Bullish targets include:

  • The weekly chart’s swing low 50% fib near $1,415. This is also near the monthly chart’s bear trend line.
  • The weekly chart’s swing low 61.8% fib near $1,500.

Bearish targets include:

  • The H&S neck line.
  • The daily chart’s 50% fib near $1,165 and the daily 200 EMA.
  • The monthly chart’s 61.8% fib level near $1,150.
  • The daily chart’s 61.8% fib which is just under the long term S/R level of $1,145.

Gold is now trading below the Cloud on the 4hr chart and in the Cloud on the daily chart suggesting choppiness.

The weekly candle closed as a bearish coloured Doji candle reflecting indecision.

  • I’m watching for any new TC signal here, the H&S pattern and the weekly 200 EMA.

GoldWeekly GoldDaily Gold4hr

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