Week of June 15, 2015 overview and chart setups

Greece resumes talk with lenders to find a deal and bridge a budget gap as demanded by lenders. However, interestingly enough, they say they will not cut pensions or raise taxes. Well now this is interesting. 

I’m not much of a fundamentals trader and don’t think I will be any time soon. Enough with the interesting news headlines tidbits and here are the chart observations I will be looking at for this week.

EURUSD 6-Hour
EURUSD 6-Hour

I will definitely be trading this pair on an hourly or shorter time frame, but I’m publishing the 6-hour time frame just to make the support and resistance levels visible. Overall, uptrend or downtrend doesn’t matter too much as this point as it all depends on how the Eurogroup meeting on June 18 goes. The two sets of parallel horizontal lines are actually potential supply and demand zones. There is a subtle difference between supply and demand and support and resistance.

GBPUSD 3-Hour
GBPUSD 3-Hour

I admit the trend-lines definitely aren’t necessary, but I would like to show my readers the trend change. There are many ways to determine a trend so I thought I would show another. The descending trend-line was already broken so plotting that back on isn’t necessary. The upwards sloping trend-line should be there. I would put it there just for the sake of spotting a break lower for another trend change.

Given the uptrend at the moment, there a few possible supply zones that we should look to close out our trades before these zones are tested. The first one coming up is just a tad above the 1.5655~ price level. There is still a good 80~ pips to go before we enter this zone.

AUDUSD 1-Hour
AUDUSD 1-Hour

Consolidating pair on the 1-hour time frame right now. I chose not to use a longer time frame simply because tomorrow’s monetary policy can cause some wild swings into this pair. The meeting is fast approaching especially as I don’t expect volatility to pick up on the night of the market open.

AUDUSD Volatility Chart
AUDUSD Volatility Chart

This is the AUDUSD volatility chart per hour of day provided by Mataf. This is adjusted to my local time, but you can see that volatility will remain quite low for the hours ahead into the night. My local time is 5:00 PM marked by the highlighted bar right now. If you were to switch over to the days of the week view, Tuesday would prove to be a great trading day. As of the moment, I’ll leave the AUDUSD alone. The consolidation happening right now will provide a sense of direction during the RBA  Monetary Policy meeting.

USDCHF 1-Hour
USDCHF 1-Hour

This isn’t a pair I do any active trading on similarly with the USDCAD pair. Right now, both of these pairs are in a downwards channel. Given the opportunities available on the other pairs with clearer signals, I do not have much focus on these two pairs.

Both USDJPY and EURJPY are incredibly interesting pairs right now given that Yutaka Harada, BOJ board member, made the statement that “there is no rush for further stimulus“. This gave the Yen a conservative gain prior the Friday’s close.

EURJPY 2-Hour
EURJPY 2-Hour

Keep in mind that trend-lines can be redrawn, the market open not only broke the trend-line, but also tested a supply zone. It’s a bit hard to see on the 2-hour chart as this zone was originally drawn on an hourly lower time frame.

USDJPY 3-Hour
USDJPY 3-Hour

Although there is no trend-line break just yet, but the lower highs and lower lows fractal pattern is a first indication that sellers are pushing the price lower. Cover shorts aren’t nearly enough to stimulate the buying once again. I would leave any selling to the short term as we need to keep in mind of the U.S. Dollar strength. The Non-Farm Payrolls was much stronger than anticipated while retail sales remain on the softer end so definitely don’t ignore the September rate hike.

With that said, I would expect a greater downside for the EURJPY pair as Greece is on the brink of defaulting and I doubt the June 18 meeting will do them much good. If Japan’s inflation figure picks up as the BOJ holds back on easing efforts, we will be seeing two very directional moves causing the EURJPY to plummet more than USDJPY.

I generally don’t focus too much on trading crosses and exotics, but I do have a few on my watch list. Stay tuned for a few key pairs I’ll be looking to trade.

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