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.
- Buy DXY. Trend – MT is bull normal. The main driver of the USD at the moment continues to be rate hike expectations and monetary policy divergence. Data has not been as supportive of this view as dollar bulls might like but the uptrend remains in-tact for now, despite some selling in the last part of the week. Technically this pull-back in the dollar is not indicative of a reversal as yet. Next week (Tues) we have retail sales and it is likely USD pairs will be responsive to the outcome. A robust figure is expected. Note, that while they are on the back burner for now, trade war fears still linger.
- Sell GBP/USD. Trend – MT is bear normal. The momentum of the downtrend has slowed but no bottom is in place as yet. Last weeks BOE meeting was overall interpreted as dovish with no hike. Remember a hike as was thought to be a done deal a month or so back. The BOE does expect data to improve and if it does, expect a rate hike later in the year to be on the cards.
- Buy USD/JPY. Trend – MT is bull normal. The BOJ remains dovish and upcoming data is expected to show the tepid nature of the Japanese economy. There is a consolidative period withing the uptrend but it’s nothing to be concerned about (markets don’t move in straight lines). Stocks are looking bullish which should continue to help to pair.
- Sell AUD/USD. Trend – MT is bear normal. The Aussie has bounced off the key 0.75 level as can be expected. Data has improved out of Australian with business confidence at recent highs. The Australian budget took an upbeat tone with revenue expected to improve. Note the downtrend is not over despite the reversal patterns, but we do need to watch out for signs of continued basing off this key level.
- Sell EUR/USD. Trend – MT is bear normal. Monetary policy is still the main driver with ECB President Draghi continuing to re-iterate lower rates for longer, while at least 2 hikes are on the cards in the US this year. We saw profit taking on average wage data out this US, but the bounce so far has been limited and the downtrend remains in-tact.
- Sell NZD/USD. Trend – MT is bear normal. New RBNZ Governer Orr’s first Monetary Policy Statement was interpreted as dovish by the market, primarily due to the note that the next move in rates could be either up or down. The pair is also under pressure because of cross rate demand for AUDNZD.
- Buy USD/CHF. Trend – MT bull normal. We are consolidating around the key 1.000 level but so far the dips have been shallow. I do think there is more upside here but as sell-off should not be a surprise given the rapidness of the rise. Note that EURCHF is also consolidating below the key 1.20 figure. The buy call remains in place but I would not be entering fresh longs here.
- Wait USD/CAD. – MT is sideways normal. The CAD displayed strength v. the USD last week due to President Trump pulling out of the US’s accord with Iran. This, along with supply concerns in Venezuela is keeping the Oil price at recent highs. On Friday, Canadian employment data came out weaker than expected but a look at the internals of the report suggests it was not a poor as the headline number indicated. I still like to play CAD strength v. the crosses.
- Wait EUR/GBP. – MT is bull normal. We are stuck mid-range of the weekly sideways quiet MT. Wait for now.
Crosses
- Wait EUR/CHF. – MT is sideways quiet. Wait.
- Wait AUD/JPY. – MT is sideways normal. Wait.
- Sell NZD/JPY. Trend – MT is bear normal. Continue to sell.
- Sell GBP/JPY. Trend – MT is bear normal. Continue to sell.
- Sell EUR/JPY. Trend – MT is bear normal. Continue to sell.
- Wait CAD/JPY. – MT is sideways quiet. Wait.
- Sell CHF/JPY. Trend – MT is bear normal. Continue to sell.
- Wait GBP/NZD. – MT is sideways normal. Wait.
- Wait EUR/NZD. – MT is sideways volatile. Wait.
- Buy AUD/NZD. Trend – MT is bull normal. Continue to buy.
- Wait EUR/AUD. – MT is sideways normal. Wait.
- Sell GBP/AUD. Trend – MT is bear normal. Continue to sell.
- 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. Continue to sell.
- Sell NZD/CAD. Trend – MT is bear normal. Continue to sell.
- Wait GBP/CHF. – MT is sideways normal. Wait.
- Buy CAD/CHF. Trend – MT is bull normal. Continue to buy.
- Wait NZD/CHF. – MT is sideways normal. Wait.
- Wait AUD/CHF. – MT is sideways normal. Wait.
Other Markets
- Buy USDSGD Trend – MT is bull normal. Continue to buy.
- Buy USDCNH Trend – MT is bull normal. Continue to buy.
- Wait Gold. – MT is sideways normal. Wait.
- Buy Oil. Trend – MT is bull normal. Continue to buy.
- Buy S&P 500. Trend – MT is bull normal. Look to buy.
- Buy DAX. Trend – MT is bull normal. Continue to buy.
- Buy Nikkei. Trend – MT is bull normal. Continue to buy.
- Sell T-Notes. Trend – MT is bear normal. Continue to sell.
View bank reports and fundamental analysis in the chatroom (members only)
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.