Forex Trading Software

Posts Tagged ‘Lack’

Nikkei down 2 pct, lack of policy action on yen weighs
Nikkei down 2 pct, lack of policy action on yen weighs

Read more on FOX Business

Friday would be an uneventful close to the week. I had tempered my expectations for the market impact that the European growth figures and US consumer-based data would have on price action; but the resultant lack of activity was even beyond what I could have imagined. However, the supposed improvement in the big-ticket German and Eurozone figures would help to offset the prevailing current that has recently exposed the financial cracks in the region that have been overlooked recently as the hope for capital returns blinded investors to real and fundamental troubles. Looking ahead to next week, there is very little scheduled event risk to go on. This could lead to one of two scenarios: we could see new trends keep direction with a focus on financial stability issues or a mild reversal on a lack of volatility. It is important to be prepared for both (and realize that there are other scenarios that could catch me off guard).

For my active trades, I am keep the focus on the majors. My best performing position to this point is the EURUSD short; which is now at half my standard size after the pair put in for its fifth consecutive decline. A correction is highly probable after such a run; so a reentry at a ‘better’ price is an option that I will have to keep open to. In contrast, GBPUSD looks like it is coming up to technical support in a rising trend channel floor around 1.55. Follow through will have to come after a significant break; so this may be more than the pair can muster unless risk appetite really drops. With this in mind, I’m only a quarter of my normal size on this position until there is a confirmed break of 1.55. My long USDJPY setup is looking good; but the recent activity doesn’t matter to me because I’m in this for the long-term (weeks to perhaps months). A break of the descending wedge of the past two-and-a-half months would certainly offer a short-term reversal to build on though. Finally, I have exposure in the crosses on that short AUDCAD. This pair isn’t reversing as quickly as some others because this isn’t a straight-forward responsive to risk trends. I am still in full size on this; but given my entry was so close to the reversal point, I should take half profit soon.

Looking for potential future trades, this isn’t a time to jump into tentative trends. USDCHF is unique because it is one of the majors that hasn’t really decided direction – breaking from its EURUSD correlation to await a strong underlying trend in the dollar. A confirmed break (ie a 240 min or daily close) above 1.06 would fulfill my criteria here as long as there is a Dow move and fundamentals to support it. A little more unusual is my EURNZD setup. Having retraced a tentative long-term descending trendline breakout, we see that the rising trend of lows has stopped the pullback at 1.80. Continuation should technically be easy to forge; but I am simply too doubtful of the euro to go in until I find confirmation that risk trends will continue to deteriorate (and Europe isn’t at the center of this fear).

View full post on DailyFX – Analyst Picks – Today’s Picks