Hi, How to Trade Slow Summer forex Markets?
This is a copy of the type of weekly winning analysis I have shared with members each week since 2008!
This week, with it being the slow summer markets, I only focused on 4 pairs. In todays’ update Tuesday the 25th, so how did I do?
Well the thermometer hit 37ºc here today (thats almost 100ºF) and it’s going to be even hotter tomorrow.
Add to that we now have the farcical situation in the Canary Islands where everyone is supposed to wear a mask at all times, it’s not pleasant! I do not have an issue wearing them inside bars, restaurants, shops etc but in the street when there is no one around, or on the beach, its a nonsense.
Ironically, Spain has the strictest rules on wearing them but the highest incidence in Europe for new cases. Who in their right mind wants to go on holiday to a place where it’s mandatory to wear a mask, in 40ºc heat and then when they return to the UK they have to stay in their houses for 2 weeks. Crazy times for sure.
We are a 1000 kilometres away from the mainland and were COVID free until they started letting the tourists back in, from anywhere, without any checks. Surprise, surprise it’s now kicked off again. There have been over 30 flights from the mainland this week from areas with the highest number of new cases. The world has gone mad.
Of the 116 cases reported here, only 8 are in hospital and one in intensive care.
The rest are at home with mild symptoms and 55 didn’t even know they had it.
In the UK the number of overall deaths in July 2020 was the lowest in the last 5 years.
Of those who died, 13%+ had influenza or pneumonia on the death certificate and just 1.7% for COVID.
I know in some countries the number of deaths is still high and rising, the Americas, India etc appear to still be in the grip of the first wave, but for those who locked down quicker, it appears to have calmed dramatically and yet the economies are collapsing once more.
For those of us whose economy relies heavily on tourism and hospitality, the situation is deteriorating rapidly and thus far governments in Europe do not appear to be rushing to pay people who have no work. THAT could lead to major problems in the very near future. If people have no income to feed their families and little hope of things improving quickly, it makes for a very scary potential breakdown of societies and for the life of me I don’t understand what is going on.
Back in March, I wrote an article asking “What are they not telling us”? more than ever we need to know.
To add to the madness the worlds stock markets, like the S & P are generally back where they were pre COVID and the NASDAQ is even higher. How can that be? There is zero logic to whats going on. If you have money tied up in stocks right now I would be very, very wary. I am out as I see all the signs of another crash coming. The recent moves are reminiscent of many previous stock market crashes.
We all saw what happened in February and early March. Technically and fundamentally I believe it is going to happen again soon and be just as dramatic. I am not a financial adviser and this is just my opinion, but the best advice is to be very careful. There should, of course, be opportunities to buy back in when it rallies, but these are some of the most uncertain times any of us have lived through.
I recorded the video and analysis on Saturday. If anything major happens before the markets open, then I may need to revise it.
Because I am looking at the big picture and because there was not much movement last week with the summer holiday season in the west, a lot of the analysis is the same in that I need bigger pullbacks on most pairs.
If they do not, then I will not trade them unless I see a decent M3 setup.
Last week, as I predicted was very slow. I took a couple of trades and neither moved all week.
This week as again there is very little red flag news I expect things to be the same, barring any extraordinary announcements. I have a few pairs that interest me again. The majority of the pairs I need a price to make some serious moves before I will be tempted to get involved in.
This week its the annual Jackson Hole Symposium Where central bankers from around the world get together (this year virtually) and decide our fate for the coming years! There will be a lot of speeches and folks vying to get their name in the world’s press so Thursday might see some movement. Its a 2-day event but I don’t trade Fridays anyway so that won’t matter.
This week there is hardly any scheduled red flag news, so it could be even quieter (see the video). News and data releases are often the catalysts that move markets. With so few and many traders away its probably going to be quiet.
I have a few trades on my radar. The rest of my pairs are too far away at the moment, so I will review them as the week progresses.
Most Interested to trade this week:
Gbp/Cad Ended where it started last week. I will long again at 1.7220. I will watch at the open in case it sets off without me. Last week it missed my entry by 10 pips and went 150+ 🙁
Euro/Yen: I was in this too and it went nowhere either 🙁 124.20 to 124.60 is the area. I might scale in half at each
Cad Yen: I said last week “82.90 is an A grade short. 78.50 & 80.00 are areas to watch on smaller timeframes”- I took it at 80.00- it went nowhere either! Looking in the same areas again.
Nzd/Cad: There is Nzd/Cad news just after the market open. If this shoots up I will short it at 0.8780. If it only drifts higher then 0.8650 is an area to watch on smaller timeframes, but there are not multiple reasons for the stop- see the video.
The rest need bigger pullbacks:
€uro/$: Almost the same as last week, however, I show in the video why 1.1560 is now of interest and the Chf correlation will be a big help “Now in no man’s land for M2 followers. I need a pullback to 1.1520 to long. Intraday watch 1.1600 for clues on the Earth & Sky or M3.”
Chf: Drifting lower, nowhere for a stop. My bias is still to short it. 0.9250 is of interest. I hardly ever trade it, but if it bounces down there the Euro will most likely bounce up. See the video.
Euro/Gbp: Same: 0.9000 is key but this one can’t make its mind up. Watch on smaller timeframes for clues to long or short. I am interested to long there. I am now officially bored with this pair until it gets some energy!
Gbp/$: You can see why I warned about longing near the 200ema and why it is so important in my trading- see the video. If it drops I need it to M2 pullback to long at 1.2665/1.2700. It has the potential to do at least 400 pips back up to the 200ema/weekly trendline..
$/Yen: Leaving- see the video
Cad: 1.3480 is the major area to short. Intraday M3 watch 1.3400. If it drops dramatically I will long half at 1.3070 & the other 50% @ 1.3000. Remember any levels I post here I place long orders 10 pips above and shorts 10 below.
Nzd: 200ema above it. 0.6500 interesting to long as the 55ema is now in the area, but not multiple reasons. Watch it on Earth & Sky or M3 for clues if it drops to there to long. The A grade long for me is at 0.6400.
Aud: 0.7000 watch there to long if trading shorter timeframes. B grade. An A grade for me is .6800.
Aud/Yen: 75.00 is a B grade to long.
To check out how the trades panned out see the following posts…….
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.
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Watch the video for more detailed explanations of this week’s detailed analysis and trade plan.
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How to Trade Slow Summer forex Markets