Last week was fairly quiet for trend trading and TS. One needs to remember though that there were over 1800 (woops...typo here earlier!) pips worth of signals from just the two weeks prior, the last 2 weeks of July!
Market sentiment turned positive on Friday due to NFP data news. Whilst this is just one, seemingly, positive bit of news (the US unemployment rate actually rose to 8.3%!), it seems the markets are tired of doom and gloom, again, and are looking for a go at being positive. There was some good manufacturing data out of the US which no doubt helped to buoy spirits somewhat as well. So, whilst logic tells me we should be looking for ‘risk off’ trades, the charts are saying ‘risk on’, and I’ll go along with what they tell me. As we all know, the markets are anything BUT logical! Make sure you check your trading calendar for the week ahead. Ben Bernanke speaks on Monday so, as with all news and fundamental items, this could tip the markets either way and, rather quickly, thereby dismantling all of my technical analysis. I've had a lot of new 'risk on' signals but I will check to see market sentiment before any trading.
BTW: I am keeping my eye on the EURX daily Ichimoku cloud chart though as we might get some choppiness ahead if, indeed, we do swing back to ‘risk on’! See my FX Indices Review for an explanation of why this chart interests me so much.
E/U: We’ve had a close above the daily bear trend line that dated back to May this year. Price has also closed above the weekly and monthly pivot and 4hr 200 EMA. The weekly H&S neckline is above price though so will need to be monitored. I have already had a TS signal to ‘long’ here late on my Fri night.
I MIGHT look to SHORT the E/U on any new TS signal, if ‘risk off’ returns and if price breaks, closes and holds below the monthly pivot and bear trend line.
I will look to LONG the E/U on the new TS signal and if ‘risk on’ sentiment remains.
E/J: I have already had a TS signal to ‘long’ here late on my Fri night. The E/J has also closed above the monthly pivot and strong S/R level of 97. There is a daily bear trend line above current price though that I’d like to see broken.
I MIGHT look to SHORT the E/J on any new TS signal, if ‘risk off’ returns and if price breaks, closes and holds below the monthly pivot and 97 level.
I will look to LONG the E/J on the new TS signal, if ‘risk on’ sentiment remains and the daily bear trend line is broken.
A/U: The bull flag pattern on the 4hr chart evolved as mapped out last week. There is still a possible bull flag pattern in play on the monthly chart too. The bear trend line of this monthly triangle pattern is about 120 pips above current price. I have already had a TS signal to ‘long’ here late on my Fri night.
I will look to SHORT the A/U on any new TS signal and if ‘risk off’ returns.
I will look to LONG the A/U on the new TS signal and if ‘risk on’ sentiment remains.
A/J: I have already had a TS signal to ‘long’ here late on my Fri night. Price baulked at the 83 level though which is a level of previously strong S/R level.
I MIGHT SHORT the A/J if ‘risk off’ returns but there are lots of road blocks in the path.
I will look to LONG the A/J on the new TS signal, if ‘risk on’ sentiment remains and if prices breaks, closes & holds above the 83 level.
G/U: This pair did give a TS short signal during the week that went on for around 100 pips. I left it though. I have already had a TS signal to ‘long’ here late on my Fri night.
I would look to LONG the G/U on the new TS signal, if ‘risk on’ remains and if price holds above the 4hr 200 EMA and monthly pivot.
I would look to SHORT the G/U on a new TS signal, if ‘risk off’ sentiment returns and if price breaks below the 1.56 area.
USD/SGD: This pair has now broken the bottom trend line of a symmetrical triangle pattern on the weekly chart. I have also had a new TS signal late on Friday to ‘short’ here on the 4 hr chart The strong S/R level of 1.241 has been broken now too!
I will look to SHORT the USD/SGD on the new TS signal and if ‘risk on’ sentiment remains.
I will look to LONG the USD/SGD on a clear new TS signal and if ‘risk off’ sentiment returns.
Swissie USD/CHF: The weekly and monthly pivot and 4hr 200 EMA were all broken on Friday. I have also had a new TS signal to ‘short’ here late on my Fri night.
I will look to LONG the USD/CHF on a new TS signal and if ‘risk off’ returns.
I will look to SHORT the USD/CHF on the new TS signal and if ‘risk on’ remains. There is a bull trend line from the weekly chart that is just below current price that will need monitoring though.
Loonie: USD/CAD: Hmmm... I haven’t had a TS signal on this pair yet.
I will look to LONG the USD/CAD on a new TS signal and if ‘risk off’ returns.
NZD/USD: I warned about this triangle breakout earlier on Friday. Price has now closed up and out of the symmetrical triangle pattern on the weekly chart. This is a rather bullish sign. The TS 'long' signal on the 4 hr chart came through late on my Friday night as suspected.
I would look to 'long' the NZD/USD on the new TS signal and if 'risk on' sentiment remains.
I would look to 'short' the NZD/USD on any new TS signal and if 'risk off' returns.
Silver: Silver is trading up a bit on the 4 hr chart and has closed above the weekly and monthly pivot and 4hr 200 EMA.
Gold: Gold is also trading up a bit and has closed above the monthly pivot but not the weekly pivot or daily 200 EMA.
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