Weekly Trade Preview: The Let’s Print More Money Edition by Dane Williams

We certainly trade in interesting times!

A new year and a new set of uncertainties to keep an eye on. The EUR/CHF, SNB shambles could only just be the beginning of some wild central bank driven currency moves in 2015. New regulations have meant that liquidity may not be as consistent as we’ve gotten used to over the last few years and the race to the bottom has begun in the currency wars.

Before the charts, I wanted to share a few articles that I found interesting reading over the weekend on the above topic:
Liquidity gaps going to be a major issue for FX market in 2015
Mark Carney warns of liquidity storm as global currency system turns upside down
Some People At Davos Are Wondering Why The Retail Currency Trading Business Is Even Allowed To Exist

Wow, that intro was way too ‘Zero Hedge’ for me… Who now I think about, am still blocked by on Twitter after a throw-away comment on their volume of tweets years ago! Lame.

It’s just a theme that seems to be developing that I want to stay on top of. There’s no point hanging myself out to dry if it can be avoided, and any trader should have the same mindset.

Onto the daily charts:

EUR/USD Daily
eu
– Well Draghi didn’t disappoint on the printing money front, beating QE expectations and smashing the Euro in the process.
– Strong daily down trend.
– The Euro isn’t bouncing back any time soon now Draghi has well and truly joined the printing money party but with the sheer number of traders short, the charts looking as stretched as they are, and the expectation that the Euro is just going to keep getting solidly smashed as it did last week, I can actually see some profit taking and a squeeze back up above pre-QE levels. In the short term at least.
It’s a huge sell on any decent rallies but I wont’ be too shy to play long on a short term basis.

GBP/USD Daily
gu
– Beautiful daily down trend.
– Chart nowhere near as stretched as the Euro but the same USD strength carrying it down with it.
– One I would rather be playing from the down side while we’re capped by the blue trend line at least.

AUD/USD Daily
au
The AUD/USD Narrative.
– The post in the above link explained why I wasn’t afraid of selling into the 80c support zone and why I’m still not afraid to be selling below it.

USD/JPY Daily
uj
– I don’t know why I post this chart. I don’t trust the BOJ and I don’t trade the pair anymore as a result.
– My opinion on the Yen is void.

One last thing to remember before you unleash yourself on the markets this week: Both in trading and in life, don’t bite the hand that feeds you…

Dane Williams – @danewilliamsau

 

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