Forex Trading Opportunities for the Week Ahead 22 Feb 16

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I plan my trading for the week ahead each weekend. Here are the Forex trading opportunities I will be stalking 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. 

  • Wait GBP/USD.  – MT is sideways normal. There was better UK data last week, but the market response was muted. Brexit concerns will continue to remain until the outcome of the June referendum, though we need to watch closely how the market reacts to the outcome of the EU summit. My base case is that the UK will remain in the EU. I prefer long GBP against some crosses, as a bit of a contrarian trade on the beaten down currency.
  • Sell USD/JPY. Trend  MT is bear normal. The pair continues to sell off in this risk adverse environment. There is the risk of BOJ intervention, but likely not until we see 111 again.
  • Wait AUD/USD.  –  MT is sideways normal. The AUD continues to hold up despite poor employment data, officials talking the pair down and ongoing China issues. My theory of this buoyancy of both the AUD and the NZD is capital outflow from China causing demand for the currency. I mush prefer shorts, but wait for the right entry.
  • Buy EUR/USD. Trend – MT is bull normal. Continue to look to buy with low conviction. There is plenty of European data next week and a move below .1050 support on negative performance would cancel our bullish thesis.  Technically, note the weekly bearish candle formation off the top of the Bollinger Bands. Selling in EURJPY may also pressure the EUR.
  • Wait NZD/USD. – MT is sideways volatile. Last weeks dairy auction results were weak, but the pair remains range bound for now.
  • Sell USD/CHF. Trend – MT is bear normal. An evening star reversal pattern suggests continuation of the downside in sympathy with the risk-off in equity markets at the end of last week.
  • Wait EUR/CHF. – MT is sideways normal. Prefer to buy near the bottom of the range. Careful of risk-off which could push the pair lower.
  • Sell USD/CAD. Trend – MT is bear normal. Canadian data was poor to finish the week, but the failure for the pair to gain any traction suggests the downside momentum is intact for now. I am watching for the currency to bottom out at around 1.36.
  • Wait EUR/GBP. – MT is bull normal. Caution required as the MT looks to be reversing/ turning sideways, and there is a weekly bearish hammer.
  • Wait AUD/JPY.  – MT is sideways volatile. Last weeks bullish reversal proved temporary and mixed price action suggests waiting for now.
  • Wait NZD/JPY. – MT is sideways volatile. Look for a breakout into a bear normal MT next week.
  • Sell GBP/JPY. Trend – MT is bear fast.  Sell, but careful of Fridays little hammer.
  • Sell EUR/JPY.  Breakout –  MT is bear normal. We clearly broke the 126.00 key level last week and look for further downside. I like to sell this pair and think there is potential for a fair bit of downside.
  • Wait CAD/JPY. – MT is sideways volatile. Last weeks bounce was temporary and now best to wait.
  • Sell  CHF/JPY. Trend – MT is bear normal. Look to sell.
  • Buy GBP/NZD. Reversal – MT is sideways normal. Continuing to reverse off the key level. Look to buy.
  • Wait EUR/NZD.  – MT is sideways normal. Wait for now.
  • Wait AUD/NZD. – MT is sideways volatile. Mid range, wait for now.
  • Wait EUR/AUD.  – MT is sideways normal. Last weeks reversal played out, but mid range so wait for now.
  • Sell GBP/AUD. Trend – MT is bear normal. Low conviction technical sell.
  • Wait  AUD/CAD. –  MT is sideways normal. Bullish hammers suggest possible buy, or otherwise wait.
  • Wait GBP/CAD. –  MT is bear normal. Failure to hold below 1.9700 support suggests caution.
  • Wait EUR/CAD.  –  MT is sideways normal. Wait for now.
  • Wait NZD/CAD. – MT is sideways normal. Wait for now.
  • Wait GBP/CHF. – MT is sideways normal. Continued signs bottoming, watch closely, I like this as a macro long-term buy.
  • Wait CAD/CHF.  – MT is sideways volatile. Wait for now.
  • Wait NZD/CHF. – MT is sideways normal. Wait for now.
  • Wait AUD/CHF. – MT is sideways volatile. Last weeks reversal played out, but it was expected to be temporary. We are now mid range so 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.

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