JUL17 – Market Analysis


BLIP IN USD STRENGTH: Looking at the charts from yesterday – Quite a bit of dollar weakness on Tuesday – across the board.  The dollar weakness seemed to be most around midnight UK time – at the start of the Asian session.  In fact both USDJPY and USDCHF closed below their 89SMA on the D chart yesterday, reducing USD from 4 to 2 points on the strength matrix!! It also means that currently neither USDCHF or USDJPY are S1B setups.  Will this be a temporary blip or does it mark a turning point?  Given this drop in USD strength, it’s actually quite impressive that my trade is still at the entry level (more or less).  Naturally it is CHF and JPY that are moving up the rankings in the matrix. The blip in USD strength whilst EUR is keeping strong, is also reflected in the appreciation of the EURUSD pair.

AUDUSD – still S1S – same comment as yesterday – the pair rallied back to a high of 9260 – quite significant really, at this level it has a much better reward-risk balance as I could short and target the previous low.  However I would need some good bearish PA, and I can’t trade it ahead of the Bernanke speech later today (3pm UK time).  At the moment there’s no bearish PA on either the 4H or D chart. 

EURGBP – still S1B – this is rallying very nicely.  There have been no opportunities to go long since the trade I put on two weeks ago – regardless of timeframe being looked at.  On the W chart it is now closing the gap that occurred at the beginning of March.

Other pairs that are either in S1 or S2 are GBPJPY, GBPCHF and CHFJPY.  Keeping an eye on EURJPY and EURAUD. 

No new orders into the market.

Discipline Strategy

Entered orders into the market.  Checked 1H and 5M charts as I usually do.  Equity markets were fairly stable yesterday.  Today there will be minutes from the BOE and a speech from Bernanke in the afternoon.  Ended up with a winning and a losing trade today.  Execution was good.

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