It was a massive week for the GBP, who are still clearly struggling to bring inflation down according to its plan. The current interest rates were clearly not enough to control it hence why they have raised it by 50 bps this week. This week we have plenty of speeches.
We also have to remember BOE cant hold high rates for too long as it will put the economy at risk, could increase unemployment, and also keep borrowing costs high which will affect the housing market and mortgages. Hence why they have to raise rates now and bring them back down as soon as possible.
The Manufacturing figures in Europe were worse than expected and have given a reading below 50 since July 2022. Germany is in a recession based on these figures. Hence why we saw the Dollar rising at the end of the week.
The Forex Week Ahead+++++++++++++++++++++++
For the week ahead we have plenty of speeches lined by all across the globe. Bailey, Ueda, Powell and Lagarde are all speaking. They have already spoken in the past couple of weeks when we had the rate statements so wouldn’t expect them to say anything different. The one to watch out would be BOJ Gov Ueda because if he comments or gives clues on the Fiscal policy or intervenes in the market then it could strengthen the YEN as it is weak and can hurt their exports.
You also have the CAD CPI on Tuesday so make sure to trade around it.
Keep watching the $index it is now at a major “make your mind up” area once again on the weekly charts. It is now stuck at the 55EMA and you have the 200 EMA just above it. If it could break above that we could be looking at $ strength.
Remember I am looking for “A” grade trades from weekly & daily charts that I can place the orders and then just walk away. A “B” grade is one that I will watch on 4 hour timeframes to see how it reacts if it hits my zone.
EUR/USD: I have a forward order at 1.10500 to short if it shoots up. If you want to trade intraday I would look on the 4HR. watch the video.
USD/CHF: Would keep an eye on DXY but clearly 0.89800 looks a good area to short Intraday
Do not take the Euro/$ & Chf at the same time. They are correlated so it’s the same “bet.”
GBP/USD: Only interested to long at 1.25260.
AUD/USD: This one is confusing where it is right now. But if it drops further I would only be interested to long at 0.65730
NZDUSD: Correlation is off so leaving it alone.
USD/CAD: Interested to short at 1.33 area as its broken below. Equally, I will look to long anywhere near 1.30600.
USDYEN: Only interested to long at 137.800 for multiple reasons. Watch the video.
Some are A grades where I will place forward orders, most pairs have “areas of interest.” I have a lot of similar crosses so be very careful with the correlation.
EURGBP: Currently in it. Took 30% and made risk-free trade. If it shoots up again will look short at 0.86150
EURAUD: I would be looking anywhere around 1.57180 and 1.5640.
EURCAD: it’s in a range that needs a clear breakout above or below for me to take a trade.
GBNZD: I have forward orders at 1.96170 and 1.95100
GBPAUD: Correlated with GBPNZD, Looking to long around 1.81300.
GBPCAD: 1.6540 is the sweet spot for me.
AUDJPY: A grade long at 91.15, multiple reasons. If the EMAS moves up I will need to move the order higher. applies to other YEN pairs aswell.
CADJPY: is interesting at the whole number at 100. I will be watching it.
NZDCAD: Have a forward order at 0.83360
M3 -Shorter timeframes.
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 onto 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.
Watch the video below for more detailed explanations of this week’s analysis and trade plan (click the 4 arrows bottom right to view full-screen):