Trade Forecast Feb 18-22

Two weeks of trading silence caused by nerves rattled by what appears to be a developing currency war between the developed economies, a madman's nuclear blast, and uncertainties caused by Europe being in the spotlight again.

It appears that some nice setups are forming in my favorite pairs and I will be looking to enter again this week.

More to come...

Trade Updates AUD/USD, GBP/USD, USD/CAD

January 30, 2013  10:45pm  (Manila)

US GDP contracted by -0.1% last quarter resulting in a fear rally back into the dollar.

However, this fueled speculation that the Fed on the FOMC meeting later today will continue its purchase of assets this year.  This means that more dollars will be pumped into the markets.

I am keeping my trades and let their stops determine their fates.

AUD/USD trade details here.

GBP/USD trade details here.

USD/CAD trade details here.

January Trade #8 - BUY GBP/USD

January 31, 2013  8:13 pm (Manila)

Second half stopped-out at breakeven.  I am still bullish for this pair and will re-renter once a setup appears.

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January 31, 2013  5:30pm (Manila)

Limit 1 is hit yielding +38 pips.  Second half stop is moved to breakeven.


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January 30, 2013  8:33pm (Manila)

BUY GBP/USD @ 1.5784
Stop - 1.5668
Limit 1 - 1.5822
Limit 2 - 1.5889

In my previous post, I mentioned that I am looking to enter this pair.  Tomorrow, a few (though not highly significant for the Cable) will come out expected to print with numbers positive for the Pound.  This, along with the pair's position in the daily and hourly charts, might be the start of a reversal for the Pound which has been hammered for the better part of this month.

Quick View: GBP/USD looks ready to kick upward

Just got a quick glimpse of this pair (GBP/USD).

A couple of things going against it - there has been persistent rumors about a possible UK exit in the EU and a possible credit ratings downgrade against the UK.  The rumors have somewhat died down a bit and it looks like a wave of profit-taking is taking place.

I'll be looking at this pair closely and may enter a BUY trade should the day end with it on a blue candle.  BB, RSI and Slow Stochs show it is oversold.  More screenshots coming as this develops.

January Trade #7 - SELL USD/CAD

February 1, 2013 3:01am (Manila)

Closing this trade at +86 pips/lot for a total of +172 pips.  Trade appears to be stalling in the daily charts.

I am still bullish for this pair - will enter once setup permits.

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February 1, 2013 2:42am (Manila)

Moving stops to protect +20 pips/lot.

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January 29, 2013  10:20 pm (Manila)

SELL USD/CAD @ 1.0051

Stop - 1.0106

Limit 1 - 0.9951

Limit 2 - 0.9851

Reasons are given here.

January Trade #6 - BUY AUD/USD (In Progress)

January 29,2013 10:15pm (Manila)

BUY AUD/USD @ 1.0452
Stop - 1.0339
Limit 1 - 1.0500
Limit 2 - 1.0600

Reasons given in the previous post.

Trade Forecast Jan 28-Feb 1

The FOMC meeting and the USD Rate statement are going to be the market-movers this week, as they have in the past.  I believe that these would fuel risk and power the AUD, EUR, CAD and NZD against the greenback.  Hence, I am preparing to take positions to BUY the EUR/USD, AUD/USD and the NZD/USD and then SELL the USD/CAD.

The EUR/USD broke through the 1.34 level last week and appears to be aiming for 1.35.  However, it is high on the hourly Bolinger Bands and RSI.  So, I am waiting a couple of days and let the profit-taking settle it before entering a BUY position.

A hammer formed on the daily AUD/USD pair - a sign that the selling may be over and the AUD might strengthen against the dollar.  With a slew of US economic indicators due this week expected to print with positive numbers, risk could provide this pair the upward momentum.  Technically, the pair is oversold as suggested by RSI, Slow Stochs and the Bollinger Bands.

The USD/CAD is due for a reversal - it has been walking the upper Bollinger Band into overbought territory.    Expectations of good US numbers printing could fuel risk  into the CAD as more US production means more orders for Canadian oil.

Dark clouds of a looming currency war are forming - Japan two weeks ago announced a massive infusion into the Japanese economy which weakened the Yen against a basket of currencies and the Swiss National Bank came out with guns blazing to hurl the EUR/CHF about 400 pips at the start of the year.

Who will fire the next blow?

The FOMC and Rate statements this week could provide clues.

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January Trade #5 - BUY GBP/USD

January 23, 2013 11:33pm (Manila)

Second half got stopped-out.  Still a winning trade.

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January 23, 2013  9:47pm (Manila)

Limit 1 just got hit at +30 pips/lot.  UK jobless claims fell to mid-2011 levels.

Second half stops now moved to breakeven making the trade risk-free.

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January 23, 2013  2:00pm (Manila)

BUY GBP/USD @ 1.5852
Stop - 1.5792
Limit 1 - 1.5882
Limit 2 - 1.5912

The pair appears primed for a rebound in the daily charts.  A set of indicators are due to come out later due expected to be positive for the Pound.

Trade Forecast Jan 21-25

Last week, I stayed on the sidelines as I did not see a favorable setup on my favorite pairs.

Looks like another week wherein my patience will be tested.  AUD/USD, NZD/USD, EUR/USD and BP/USD are all going through a correction.

The German economy printed an economic growth number that showed t was slowing down - good news and bad news.  Bad news for the Euro in the short-term, which is probably the cue for traders to dump their Euros and take-in profits causing the correction currently underway.  The good news is that Europe's big boy is still growing.  That, coupled with the relative silence in the Eurozone on sovereign debt issues, would be enough to set the bullish tone for the Euro in the long-term.  The 1.34 level seems to be a strong resistance level.  Once the pair breaks that, I am looking to BUY.

AUD/USD and NZD/USD are both treading identical paths.  I am looking to BUY these pairs once the corrections end and setups present themselves.

For the USD, I'm keeping an eye for what appears to be a looming battle over the US Debt ceiling in Washington.  If another impasse persists, a wave of risk aversion could ensue and the corrections on the dollar pairs could continue.

The world eagerly awaits the BoJ policy statement this week.  Shinzo Abe's government announced the much rumored fiscal stimulus package last week which sent the yen pairs through the roof.  However, at least one Japanese minister publicly acknowledged that a weak yen would not be in the best interest of a Japanese economic recovery, dousing cold water on the JPY pairs.  In the long-term, I believe that USD/JPY is headed upward - correction could happen this week.  Looking to BUY into USD/JPY once correction ends.

No trades this week

No setups... therefore no trades... looking forward to better trading positions next week.