Thursday, April 10, 2014

Trading Week 10th April: RORO

Indices: The EURX and USDX indices are close to trading in a 'risk on' alignment. This result when the USDX trades below the Ichimoku Cloud on the 4hr and daily chart, as is the case now:

USDX 4 hr:

USDX daily:

For the EURX a 'risk on' alignment results when the index trades above the Ichimoku Cloud on the 4hr and daily chart. This is almost the case here but the 4hr chart needs to close above the Cloud to confirm any alignment:

EURX 4 hr:

EURX daily:

Implications: Alignment like this can often, but not always, point to favorable 'risk on' trading. These trades are generally short USD and long EUR, GBP, AUD and NZD etc. Thus, if this alignment evolves and holds, then I'll be on the lookout for new TS signals in line with this momentum. 

This RORO momentum is not reserved just for FX pairs though. As I type this note the Aussie stock market is pushing up into new territory above long term resistance and making the highest reach since 2008!

Cable: I am seeing some trading talk at the moment calling to short the Cable here as it nears the 1.68 resistance area. I can understand that price might stall at this level but, personally, I would want to see clear confirmation of a reversal here first otherwise it could be a bit like stepping in front of a moving train! There is interest rate data due out for the GBP later today and this needs to be monitored:

G/U 4 hr:

G/U monthly: even with all of my messy labels you can see that price has popped above key resistance and has some clear sky ahead of it!

EUR/USD: there is already a 'long' TS signal here on the 4hr but traders need to watch the looming triangle trend line from the monthly chart. Any break and hold above this trend line would be very bullish. I also have a TS signal trying to build on the daily chart as well:

E/U 4 hr: 

E/U monthly:

No comments:

Post a Comment