Hello everyone,
Hope you all had a good week, my midterms are all over by this point in time. From here on out, it’s just work commitments and assignments until April when final exams start. I’ve started trading (quite actively) again the past few days, those trades will be posted shortly. The video series is still on hold until May, I need the time off. It takes a lot of pressure off my back for not having to rush out videos every other day. So, I’m taking this time to recover, collect my thoughts, have some fun with trading again and most importantly, focusing on school! Anyways, onto this week’s FX analysis…
Monthly Chart
Weekly Chart
Daily Chart
H4 Chart
Commentary / Technical Forecasts:
USD/CAD [Long (C)]: My favorite pair (sarcasm), but the one that I pay closest attention to because it affects me since I live in Canada. It affects my own and my parent’s international spending and USD holdings. They’re still holding a chunk of USD, more than me, I’m still waiting for the right moment to exchange the rest of it since we’re running low on CAD. Obviously, charts and run on forever but I’ve drawn an upward trendline on the H4 chart to illustrate a potential symmetrical triangle/upward trend forming. The line is drawn due to the wick on one of the candles. This already broke all the supports that I’ve drawn previously, so I’m no longer referring to those levels. Going up, USD/CAD has some work to do to break levels in order to go bullish, hence the conditions since the downtrend has been going on for so long.
AUD/USD [Short (C)]: Finally bounced away from the monthly trend line and starting to form the downward channel as seen on the H4 chart. Going down, we have a few support levels but there’s still a condition, which is why I’ve left the upward channel (red lines) drawn on the daily chart. AUD/USD can form a bullish flag in the coming week(s) leading to an upward movement. Regardless, I’d like to see AUD/USD break downwards.
EUR/USD [Short (C)]: If you look on the weekly chart, you’ll notice that EUR/USD broke the downward trend line a few weeks ago and retraced back down to hit the same line. Typically, EUR/USD does this a lot, it’ll break a trend line then retrace back to it then continue in the new direction. This is the iffy part of EUR/USD, because if you turn to the daily chart, you’ll see that it broke the daily upward trend line in the channel bounce this week and retraced then NFP pushed the price down, thus, starting the downtrend. With these two conflicting conclusions on different time frames, I’m not totally sure on the direction, but I’m leaning towards the daily channel since that may be a little more accurate in the grand scheme of things. Depending on when you started following my FX weekly analysis, you’ll recall that I’ve been calling for a EUR/USD breakdown since I started doing these back in July 2011. In terms of macro economics, it would probably be best for the Euro to breakdown rather than the USD to fail.
GBP/USD [Short (C)]: In order to continue on it’s currently downward path, it must first break the daily trendline, so that’s in the way. But given the bounce off the monthly trendline, I really like this move given the current PA and the rejection. At the tip of the trend lines lies a support level as well, so if you want to label this a bullish flag, that’s reasonable as well (see the daily chart). In hindsight, I should’ve circled it to illustrate this point but look at the daily chart in the second quarter of the chart, you can see the same flag that it’s currently in and what happened shortly afterwards. If history repeats itself, this “flag” will fail again and breakdown here.
Until next week, Good Luck Trading!
Brian