Trading Week Analysis 30/4/2012

Note: I have posted 2 reviews today, Sunday 29/4/12; My Indices Review and my Trading Week Analysis.  Only one e-mail alert will be sent though most likely.  Please make sure that you read the Indices Review so that you understand my perspective for the week.

The trading sentiment late last week was ‘risk on’ along with a falling USD. The USD is currently at a support level which will need to be broken to see continued ‘risk on’ trading.

PS: Remember we have the first trading day of the month this Tuesday 1st May. Whilst there is the saying 'sell in May and go away' there is also the phenomenon of statistically more bullish 'first day of month' trading days as well. 

E/U: Price has just broken out and up through the bear trend line of the smaller of 2 descending wedge patterns that the E/U is trading within. Price has broken above the 4hr 200 EMA and has also just broken above the monthly pivot. News will certainly continue to impact upon this pair.

There is still potential for the bullish 'inverse Head & Shoulder' pattern to evolve here (seen on the monthly chart).
I am currently LONG on the E/U.

E/J: A possible bearish Head and Shoulder pattern could still be forming on the daily chart. This pair has traded down late last week but mostly due to BoJ news.

I would only look to LONG the E/J on a new TS signal and if price breaks, closes and holds above the 4 hr 200 EMA.

I won’t SHORT the E/J.

A/U: This pair gave a TS LONG signal earlier in the week. Price has finally broken above the daily and 4 hr 200 EMA.

I went LONG on the A/U once price breached the 4 hr 200 EMA. This was my stated plan from last week.

A/J: This pair also traded down late last week due to BoJ news.

I will look to LONG the A/J on a clear TS signal and a break, close and hold above the 4hr 200 EMA and if ‘risk on’ sentiment remains.

I won’t SHORT the A/J.

G/U: I missed the triangle break out and TS signal to LONG this pair last week and it is now up 260 pips!  I am quite annoyed as I had been pointing to this triangle break out trade on the monthly charts for weeks! This trade could keep going for some time!

I won’t chase this LONG trade.

I would only look to SHORT the G/U on a clear TS signal and if ‘risk off’ sentiment returns.

USD/SGD: This pair has finally broken out from trading within a symmetrical triangle. It is currently up about 90 pips. Unfortunately, I did not get a clear TS signal for this pair on the 4 hr charts so I did not take this trade.

I won’t chase this SHORT trade.

I will look to LONG the USD/SGD on a clear TS signal and if ‘risk off’ sentiment returns. 

    

Swissie: I’m not trading this pair but it, too, has broken down from trading within a symmetrical triangle pattern and also broken below the 4hr & daily 200 EMA and weekly and monthly pivot. This pair is inversely correlated with the E/U though so one could look to SHORT this pair if ‘risk on’ sentiment is still evident this week. I am already LONG on the E/U though so won’t take this trade.

U/J: I’m wary with this Yen pair.  I have had a TS signal to SHORT this pair but, like with all of the Yen pairs, I won’t be shorting this pair.  I would only trade this LONG on a TS signal if the USD returns to a rally and this pair broke out and up from the flag pattern / trading channel.

Loonie: The Loonie has finally broken down and out from the triangle pattern I have been pointing out for many weeks. You would be up about 70 or so pips if you traded this breakout.

Silver and Gold: These are both still trading within symmetrical triangles. A falling dollar can often boost demand for metals BUT they could both have a bit of a fall if the USD keeps tumbling and people then divert money back into stocks though. I’ll be keeping an eye on the trend lines here.