Hi, it’s exactly 12 months to the day since the Covid pandemic began here in Spain. The day when we went into total lockdown for 7 weeks. We were only allowed out to walk to the nearest shop and short walk with the dog or risk a €3000 fine with cops who are always keen to enforce them 🙁
Since the contagion spread around the world and governments had little choice but to print trillions of $ worth of fiat currency at a time when many experts were already forecasting a new financial crisis (you can’t keep printing paper money out of thin air forever).
As a result, fundamental analysis has largely been ignored. We usually use it to filter our trading ideas and help give a bias as to whether a country’s economy is better than others or not.
As every major economy has been printing more notes as millions of folks are either unemployed or being supported by government handouts, then each country has been in a similar state. However, there are some “green shoots” starting to appear.
The Uk for example is way ahead of most of its competitors, especially the Eurozone who made a complete hash of organising and failing to ordering enough vaccines.
Canada also were a lot more upbeat last week with their rate statement. They raised their outlook to positive for GDP growth & that the economy was proving to be more resilient to the second Covid wave than previously expected.
You can see the full article from Reuters here: Canada Improved Growth
Our own Andi Thornton recently updated our fundamental pages. Things are happening so quickly that he will need to do so again quite soon!
You can find an introduction to Fundamental analysis in the Education area: CLICK HERE
Trade for clients & receive a substantial profit share
If you want to receive a substantial profit share you only need to make 3 to 5% per month. You can find a copy of the brochure here: Trade for Clients
The Forex Week Ahead.
I said last week ” do not be greedy at the moment. A lot of trades won last week but for 50/60 pips and then reversed. These are choppy markets, move stops to entry and or take some profits.”
That turned out to be the case there was a general lack of movement/follow through on many pairs last week and many of the majors are too messy for me to trade right now SO as ever I have had to be flexible and found some good opportunities elsewhere. Especially on the Cad and its cross pairs plus a lot of the Yens.
There is a LOT of news this week that we will need to tiptoe around as ever. If the Cad cpi on Wednesday is better than expected that might be the catalyst for it to strengthen further, conversely, if it’s a lot worse it could weaken, so do not trade around that time and move stops or close open trades before it.
The biggest events are FOMC on Wednesday which could rock the $USA, Nzd Gdp soon after along with Aud unemployment, and Thursday its the turn of the UK- all explained in the video.
€uro/$: THis is too messy now for me. Zoom out and watch on the weekly. 1.1600 is the first place I will consider a long. I said in recent weeks that it “couldn’t make its mind up” wow did I get that right!
Chf: Worked last week “watch 0.9235 and especially 0.9150 for a long.” I still prefer a short higher up at 0.9560 now
Euro/Gbp: Failed to break the trendline yet again. I only want to short, preferably a pullback to 0.8680 or 0.8740- the other choice is to wait for it to break the trendline, then pullback. see the video
Gbp/$: Same as last week…1.3400 long is a zoomed out entry. Intraday 1.3760 is an area to watch but it’s not an A grade for me. Leaving for now.
$/Yen: 108.00 possible long but not an A grade. If you do take it do not be greedy. 110.00 is huge previous support and resistance and there is a weekly trendline not far above- see the video. Swing traders will be looking to short there.
Cad: Hopefully I kept you out of a loser last week when I said “Be very careful with this one…..I will not counter-trend long it now…. it dropped as I anticipated.
A Zoom out entry is to short at 1.2990. Intraday areas to watch 1.2720 and 1.2850 (not for me).
Euro/Cad. I do like the look of this one. I will short at 1.4990 if it pullsback
Gbp/Cad: Last week I was looking to long at 1.7300 but not now. The Cad strength looks solid and no one knows about the Gbp until after Thursday’s news. IF that turns out to be positive then I might consider a long for now only shorts- see the video.1.7600 is a good area to consider.
Nzd: Flip flopped: If it just drops then I will be interested to long at 0.7080/0.7100
Nzd/Chf: Not a pair I trade but one of my private students points out that 0.6550 looks good to long.
Aud: Even less clear. Zoom out entry is 0.7360/7400 area.
Euro/Yen 128.00 is a good place for a long for me.
Euro/Aud: 1.5630 for a short
Euro/Nzd: I will short if it pulls back to 1.6970
Nzd/Cad: I will short if it moves back up to 0.9090. Good risk reward- see the video.
Gbp/Nzd: Worked again last week but its looking range bound and might break higher now. I am not as confident but …1.9400 is still “the sweet spot” to short.
M3 Shorter timeframes
See the new course & recent blog posts as to how I do this: I do my analysis on daily and weekly charts first and make a note of the MAJOR areas of support and resistance. Then copy them on to Pierre’s Earth and sky template. Then I make a note of the weekly & monthly pivots points and add them to the charts. You will see lots of opportunities line up during the week. The important thing then is to select a bias for the next few days and do NOT take trades if the price is too near a trend line or pivot. Ideally, you want to buy when the price is near a major support and or pivot point line and has the potential to make at least 40 pips. Vice versa for a short.
New members, please note: If I am looking to take a trade long, for example, 1.5000, I place my order 10 pips above & 10 pips below for a short. This is because price often does not quite reach a major line and you need to allow for spreads.
We are NOT a “tipping service” our aim is to teach you how to trade for yourself.
For more up to the minute, updates do not forget to drop by the forum.
Watch the video for more detailed explanations of this week’s analysis and trade plan.
If you would like to learn how to trade like a professional check out our 5* rated forex mentor program, RISK FREE; by clicking on the “Get Started Today” Button below