Oct 1 – Market Analysis

Markets overall

Equity markets gapped down on Monday and traded with low volatility for most of the day.  Gold and oil continue to be steady.

US government has in fact shut down today.  Remember that there is a lot of news announcements this week.  ECB rate meeting is tomorrow – thus no EUR trades. Bernanke speaks Wed 8.30pm on Wed.  Thus I am reluctant, but not totally prohibited, from entering into USD trades.

FX Markets

Strong and weak pairs are still the same.  Although JPY still seems to do well on the 4H charts.  NZD is lagging a little bit on the 4H charts.

All of the strong/weak JPY pairs continue to be in S1 setups:  EURJPY, CHFJPY, NZDJPY, GBPJPY

The Yen pairs rallied strongly yesterday – this occurred shortly after the 4H 3pm candle closed – meaning that I was not able to enter a trade – as I cannot enter trades on the basis of partially completed 4H candles.  Price has now retraced, but I need to now wait for bullish price action on the 4H chart – I will check the 3PM candles to see how things have developed by then.  However I have entered order to go long AUDJPY – on the basis of demand and supply.  Thus nothing doing on the JPY S1 setups at this stage.  Bear in mind that the BOJ rate announcement is on Thursday morning.

The USD pairs:   GBPUSD – is rallying strongly.  No retracement thus far.  EURUSD – is also rallying (not as strongly as Cable). No good retracement thus far.  Additionally cannot trade EUR ahead of the ECB conference tomorrow.  NZDUSD –  price action for today (to this time) looks bearish – a bearish pin bar is form, following several days of sideways trading. USDCHF – no retracement thus far

AUDNZD – rallied on the RBA rate announcement – this is an excellent retracement – look for bearish price action on the 4H or D chart in order to short the pair back into the demand zone

Thus, all in all, no new orders to enter into the market

Actions to take

  • 3pm – Check 4H candles on JPY and USD charts of the S1 pairs – is there bullish price action on which to go long?
  • 10pm – Check D chart for AUDNZD
  • Wed, post-ECB announcement – watch for selling the EURGBP supply zone
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