The four USD trades earlier were finally closed off. In anticipation of the three US releases, the trades were closed at a slight gain. The unemployment claims, retail sales MoM, and core retail sales MoM all disappointed. This was partially expected seeing the overall slowdown in “growth” from the NFP release.
Just a mere 95 pips in four pips, but this revealed some interesting divergences with USD pairs. This chart is currently on USDJPY. It can be seen here that this pair is retesting previous support and resistance zones.
There is no specific trading plan here really. USD is losing strength so it is best just to play off ranges either reversals or break-throughs. This will increase the reward to risk ratio. How this works is that stop losses will be placed past the zone. There is no need for targeted close outs. It is just a matter of monitoring price behavior and seeing how it plays out in these zones.
AUDUSD closed the market on Friday at a trend-line. The current prediction is a gap down on the market open and will continue to trend lower.
AUDUSD has been a very good swing trading pair. As this counter-trend ends, it would be another opportunity to ride the next sell-off trend. The RBA valued the AUD at 0.75, this means there is about approximately 264 pips to go before it meets the RBA target.
USDCAD is also making a turnaround. This pair returned the past week’s worth of gains in just two days of trading. It could be because traders tended to close out their positions before the market close on Fridays, but it seems like this weekly resistance zone is holding up.
Just looking at the fractal changes, the price failed to break up above previous highs. On a lower time frame, the key level to watch out for is 1.2374. Once it breaks below this point, we should expect to see a serious trend change.
Generally speaking, there’s more selling going on that buying. Buying has been steady while selling occurred in spiking impulsive movements. The next U.S. release could trigger an even greater spike. I do not see much upside in this, but it would also be best to make the selling conservative.