Oct8 – Market Analysis

Market Analysis

Equity markets still falling a little in Europe and in the US.  US Government shutdown is the key issue at hand.  Tapering in the US is now most likely pushed further into the future because of the negative impact on economic growth caused by the shutdown, and by the absence and accuracy of US economic data.

News this week : BOE rate decision (Thu morning), speeches from various central bank leaders throughout the week, FOMC Minutes (Wed night) although this are going to have less impact now because of the government shutdown

FX Analysis

No change in the rankings. AUD continues on 5 points, NZD on 12.

S1 Yen pairs – AUDJPY : 89MA is providing support on D chart.  On D chart, price has more or less been trading sideways. In other words, there has not been a significant retracement.  Technically speaking, there has just been a 4H corn-trade setup but overall the setup is not good enough. NZDJPY: No retracement/bullish price action.  I took another (close) look at the weekly momentum on the other relevant Yen pairs (i.e. those were the Yen pair is matched against a strong currency). Technically speaking, the momentum is presently in favour of Yen, therefore invalidating the prior S1 environments, however on the basis of last week’s W candles, the momentum is in fact still in favour of the other currencies.  Thus the pairs are still all in S1 setups.  EURJPY good retracement thus far, continue to monitor 4H chart for corn-trade setup.  GBPJPY  very strong retracement on last week’s W chart – no bullish price action as yet.  CHFJPY no bullish price action at this point.

S1 Dollar pairs – EURUSD yes for retracement, but there has not been bullish price action.  NZDUSD   Heavy sideways trading – therefore no setup here.  USDCHF is holding support just above the 9000 level.

S1 CAD pairs GBPCAD – looked at 4H again – no setup. Price is trading sideways – could it set up for a corn-trade?  The 21MA is now trending down and will most likely fall through the current price level. EURCAD  no setup NZDCAD  trading mostly sideways, no setup CADCHF nothing at this point.

S2 setups: AUDUSD (strengthening/weak) – Although there has been a retracement, the pair has not recovered nearly all of that retracement’s ground by now and is heading into the high of mid September 60-80 pips away.  AUDCAD is rallying nicely, but there has not been a retracement.  Thus no trade.

All in all, no orders to enter into the market at this point.

Future action points

Keep an eye on CADCHF 4H chart, and also GBPCAD

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