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 DXY. – MT is bull normal. While we are just holding onto a bull MT, topping action is in place and we have moved back within the recent range. The weekly charts have us firmly ensconced in a sideways quiet MT. When we break out of this MT there should be a nice trend, but until then it’s best to trade without too much aggression. There is more positive news on trade, with the US and China continuing to engage in high levels talks. We can expect President Trump to extend the March 1st deadline for adding more tariffs and a meeting between the two leaders is on the cards. There is talk by the Federal Reserve of ending the run off of it’s balance sheet. This is dovish. US Data has been coming in on the weaker side. Wait for now.
- Wait. GBP/USD. – MT is sideways volatile. The sideways volatile MT played out last week with the GBP rising back through the 1.30 figure. Market participants are expecting an extension to the end of March Brexit date as Prime Minister May is not keen on a disorderly Brexit. There will be another vote coming up this week, but analysts suggest it will not be what has been termed “the second meaningful vote”. More aggressive traders can continue to look for a move towards 1.32, but a more prudent trader would wait.
- Buy USD/JPY. – MT is bull normal. There was little movement in the currency pair last week. US stocks are rising gradually. US Bond yields are flat. The BOJ remains dovish. Tentative buy.
- Wait AUD/USD. – MT is sideways normal. The Aussie was crushed last Thursday by reports that China has banned some of Australia’s coal imports. It was seen as a retaliatory move for Australia’s ban on Huiwei last year. On the same day, Westpac came out with a report saying they expected two further rate cuts this year. But half the gains were recovered on Friday as officials downplayed the ban and there was more optimism around US/China trade talks.
- Wait EUR/USD. – MT is sideways volatile. After recovering from last weeks lows, there was very little movement in the last three days of the week. Economic data remains a headwind for the pair. Best to wait.
- Wait NZD/USD. – MT is sideways normal. NZD sold off and recovered in sympathy with AUD. I think Kiwi is still one of the better long-term plays. Dairy prices are recovering, govt spending should provide a boost to growth in 2019 and any resolution in the US/China trade spat is supportive of the pair.
- Wait USD/CHF. – MT sideways normal. The pair sold off on the back of USD weakness, but has subsequently held up given the continued rise in stocks and the trade talk optimism.
- Sell USD/CAD. – MT is sideways normal. Retail sales came in slightly better than expected and the oil price is up. This, along with trade talk optimism, made CAD the strongest performing currency on Friday, We can expect the pair to test 1.3070 this week.
- Sell EUR/GBP. – MT is bear normal. We got the anticipated sell off last week and can continue to target the low at 0.8630.
Crosses
- Wait EUR/CHF. – MT is sideways normal. Wait.
- Wait AUD/JPY. – MT is sideways normal. Wait.
- Buy NZD/JPY. – MT is bull normal. Look to buy.
- Buy GBP/JPY. – MT is bull normal. Look to buy.
- Wait EUR/JPY. – MT is sideways quiet. Wait.
- Buy CAD/JPY. – MT is bull normal. Look to buy.
- Buy CHF/JPY. – MT is bull normal. Look to buy.
- Wait GBP/NZD. – MT is sideways normal. Wait.
- Sell EUR/NZD. – MT is bear normal. Continue to sell.
- Sell AUD/NZD. – MT is bear normal. Continue to sell.
- Wait EUR/AUD. – MT is sideways normal. Wait.
- Buy GBP/AUD. – MT is bull normal. Look to buy.
- Sell AUD/CAD. – MT is bear normal. Continue to sell.
- Wait GBP/CAD. – MT is sideways normal. Wait.
- Sell EUR/CAD. – MT is bear normal. Continue to sell.
- Wait NZD/CAD. – MT is sideways normal. Wait.
- Wait GBP/CHF. – MT is sideways normal. Wait
- Wait CAD/CHF. – MT is sideways normal. Wait.
- Wait NZD/CHF. – MT is sideways normal. Wait
- Wait AUD/CHF. – MT is sideways normal. Wait
Other Markets
- Wait USDSGD. – MT is sideways normal. Wait
- Sell USDCNH. – MT is bear normal. Look to sell.
- Buy Gold. – MT is bull normal. Continue to buy.
- Buy Oil. – MT is bull normal. Continue to buy.
- Buy S&P 500. – MT is bull normal. Continue to buy.
- Buy DAX. – MT is bull normal. Look to buy.
- Buy Nikkei. – MT is bull normal. Continue to buy.
- Wait T-Notes. – MT is sideways quiet. Wait.
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Economic calendar for the week ahead:
(MT = Market Type: Click for more information on market types.)
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.