{"id":218277,"date":"2022-10-02T09:27:03","date_gmt":"2022-10-02T08:27:03","guid":{"rendered":"https:\/\/www.forexmentorpro.com\/blog\/?p=218277"},"modified":"2022-10-03T13:19:15","modified_gmt":"2022-10-03T12:19:15","slug":"weekly-analysis-gbp-to-parity-next","status":"publish","type":"post","link":"https:\/\/www.forexmentorpro.com\/blog\/weekly-analysis-gbp-to-parity-next\/","title":{"rendered":"Weekly Analysis: Gbp to parity Next?"},"content":{"rendered":"

Hi, crazy markets, Gbp to parity? and 2000+ pip profits if only….<\/p>\n

At the start of the year, on the 4th of January, I explained that my analysis, both fundamental and technical told me to focus on $USA strength.<\/p>\n

I showed how analysing the $Index would give clues as to when to buy the $ and it has worked extremely well on multiple Chf & Cad trades.<\/p>\n

I would be looking to short all the majors, especially the Euro,\u00a0 against it and only look to long the USD\/Chf & Cad.<\/p>\n

I have explained repeatedly during live sessions that I converted all my \u20acuros, including proceeds from a house sale into $’s, plus all my GBP. That move has given me a cushion against inflation and is currently around +20% for the year so far.<\/p>\n

I showed how I expected the \u20acuro to keep falling. That the Flag pattern setup on that date suggested a 700 pip drop.<\/p>\n

For the naysayers, A) I said it \ud83d\ude42 & B it worked and overall I thought that $1.10 would be my first target, then the previous low at 1.06 and that we might even see parity, 1:1<\/p>\n

Then a few months ago I explained why I now felt that 0.90 was quite possible for the \u20acuro to fall versus the $ and we appear to be on our way now.<\/p>\n

I also showed how in 2021 if you had taken one short on the Euro you would have made over 1000 pips. This year had you shorted on the 4th of January the first trade would have lost. If we had shorted it again on the flag pattern break and stayed in the Euro that would have been around a 1700 pip win. The same setup on the GBP would have seen a 3000 pip maximum profit so far!<\/strong><\/em><\/p>\n

One of my private clients (he’s much better than me at staying in longer-term) has just closed an AUD trade from earlier in the year and has banked over 1100 pips and made a 40% profit on his account!<\/p>\n

This “position” trading is what I aim to focus on going forwards. Once again this year I have made my monthly target on 5 occasions (7 last year) from 5 trades or less. Had I doubled up and left the balances to run I would have made considerably more!<\/p>\n

So what of the Gbp now? As with the other majors, the focus has been to sell it all year. A few weeks ago I thought it was quite possible we would see $1.10<\/p>\n

The new Truss government in the UK managed to cause a major panic with their tax-cutting project. As we saw the Gbp fell off a cliff, and the other majors fell too, but not as much. The Bank of England has had to agree to buy GBP50 Billion of bonds (government debt) to calm the panic (More money printing). The UK stock market has fallen too.<\/p>\n

As I posted here last week this situation is ripe for a potential “Soros” moment and a lot of funds and traders will be queuing up to try to take advantage of the chaos.<\/p>\n

GBP to parity?<\/a><\/p>\n

My hope is that the Gbp will move higher and I can short and stay in this time as parity and below is quite possible in the short term at least.<\/p>\n

At some point, the nonsense of $ strength will end. Their debt mountain will never be repaid and it continues to grow at a ridiculous rate. When you include future liabilities for social security, pensions and medicare) is over $140 TRILLION: US real debt versus Government figures<\/a><\/p>\n

However, I don’t think it’s going to happen for a few months yet and more likely not til the new year BUT as ever things can change in a heartbeat as we saw last week<\/p>\n

+++++++++++++++++++++++++++++<\/p>\n

You can also follow me on Twitter https:\/\/twitter.com\/marcwalton<\/strong><\/a><\/p>\n

Trade for clients & receive a substantial profit share<\/p>\n

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<\/a><\/p>\n

*********************************<\/p>\n

The Forex Week Ahead<\/h3>\n

Many markets, currencies and stocks are at or very near major areas. The Nasdaq for example is at the Monthly 55ema and the S&P500 is not far from it. A bounce is quite possible in stocks. However, I am buying nothing! I expect a bounce to be short-lived for now at least. If stocks do bounce, the $USD usually drops and therefore the majors will move back up. That will give us a chance to short higher up THEN try to stay in for a move down.<\/p>\n

I am expecting a much bigger drop, though they will rebound at some point. My hope is that we might get near the Covid lows from Marc 2022 over the next 6 months THEN I will be looking to buy and mainly hold blue chip, dividend-paying stocks.<\/p>\n

This week there is big AUd & Nzd news. Both these pairs need a rest! Hopefully, there will be pullbacks for us to short. On Friday it’s NFP which we never trade. The cynic in me thinks that this month will be as expected, then next month, just before the midterms they will be great! I could of course be wrong, so as ever I will not trade it.<\/p>\n

++++++++++++++<\/p>\n

MAJORS<\/strong><\/h4>\n

My fundamental bias is still $ strength versus all majors. As ever keep watching the $ index for clues.<\/p>\n

Remember I am looking for “A” grade trades from weekly & daily charts that I can place the orders and then just walk away.<\/p>\n

EUR\/USD: Bias is only to short, but once again it has stopped below parity, that is now the first place to consider a short. I will trade it from a 4 hour chart. If it moves higher then\u00a0 is1.010 is a strong area. If I catch it I will take 50% profit at 1:1 then leave the balance to run in the hope of a bigger move down. As I said last month I suspect the \u20acuro could hit 0.90cents in the coming months. Having said that if there is a permanent ceasefire in Ukraine that could give it a temporary rebound.<\/p>\n

USD\/CHF: Worked yet again last week for 70+ pips<\/strong><\/em> for Ashley and some of the other guys in the forum. I only want to Long this pair. The A grade is back down at 0.9520 BUT watch 0.9700 on the 4 hour.<\/p>\n

GBP\/USD: I only want to short. The A grade is back up at 1.1700. If it does get there I will increase my normal risk. Intraday 1.1370\/1.1400 is interesting too on a 4 hour.<\/p>\n

AUD\/USD: Big news this week. A grade is to short at 0.6770 for me. 0.6700 is the area to watch on smaller timeframes.<\/p>\n

NZDUSD: Another with rate news. A grade will be around 0.6400 but its a long way. Intraday you could watch 0.6000 on the 4 hour for clues to short it.<\/p>\n

USD\/CAD:\u00a0 All that pent-up energy! After 20 months of trying it finally broke 1.3000, now it doesn’t want to stop. 1.3050 is an A grade but unlikley though never say never \ud83d\ude42 On the 4 hour 1.3300 is interesting. Big Cad news this week. That might cause a drop.<\/p>\n

CROSSES<\/strong><\/h4>\n

EURGBP: Looking to long at 0.8620\/8650.<\/p>\n

EURCAD: I only want to short it’s not an “A2 grade. I am going to watch at the open and might wait until after Nzd news. 1.3650 is an area to consider a short. If it moves higher then 1.3720 looks stronger.<\/p>\n

EURNZD: Swing traders will be interested to short at 1.7650 I prefer to long at 1.6900<\/p>\n

EUR\/AUD: Not for me but swing traders will be looking to short at 1.5770. Those who are long consider taking some profit if not all, there.<\/p>\n

NZFCHF: 0.6200 is now the major area but it’s unlikely to get there this week. 0.5900 is also an area to watch on a 4 hour chart.<\/p>\n

GBPNZD: The best\u00a0advice is to ignore all GBP crosses until things settle down. This pair moved 1850 pips last week!<\/strong><\/em><\/p>\n

AUDCAD: Short around 0.9090\/split and other half at to 0.9060,<\/p>\n

AUD\/NZD: I don’t like this pair. Only interested to long 1.1100 & 1.1020 are areas to consider<\/p>\n

GBP\/CAD: The best\u00a0advice is to ignore all GBP crosses until things settle down<\/strong><\/em><\/p>\n

CHF\/YEN: Most interesting of the Yens. Last week it worked perfectly, see the video. I will long at 1.44.25\/144.50<\/p>\n

GBP\/YEN: I never trade this at the best of times. The best\u00a0advice is to ignore all GBP crosses until things settle down<\/strong><\/em><\/p>\n

AUD\/YEN: Looks interesting to long at 91.65. I am wary with all Yens at the moment, see the video for my thoughts<\/p>\n

CAD\/CHF another one a member asked me to look at 0.7350 is the start of the zone.<\/p>\n

As always, remember correlation!<\/strong><\/p>\n

We are NOT a \u201ctipping service\u201d our aim is to teach you how to trade for yourself.<\/p>\n

\"\"<\/a><\/p>\n

Watch the video below for more detailed explanations of this week\u2019s analysis and trade plan (click the 4 arrows bottom right to view full-screen):<\/p>\n

Regards<\/p>\n

Marc<\/p>\n