The AUDUSD pair has been in the spotlight for the past week. I considered it one of the few only tradable pairs simply because it didn’t seem to be affected too much by the Non-Farm Payrolls. The entry signal was clear and here are the results below.
Unfortunately I did not ride this pair through the whole week, but I recommend closing it out as we see the exhibition of two dojis just before the market close.
Not only are we seeing a failure to break higher, but the last 8 hours have been in a tight range. We can expect sellers to start closing out positions in the upcoming weeks from this 220 pips rally. The second thing to keep an eye on is the potential supply zone that price has barely entered. Whether this zone holds or not is not guaranteed, but simply marks a high probability turning point.
Currently, I am watching the Euro pairs expecting a sell off on next week’s market open. Starting off with the EURJPY pair, it’s experienced a good week of buying and I currently expect to see a correction.
This sell-off began near the market close as traders started to liquidate their positions as, of course, anything can happen over the weekend. This also extends to the EURUSD pair after a pretty intense week of stalling in an upwards range with a slight break-out.
Finally, the U.S. Dollar slumps to the $1.2940 mark and this will be a longer term position trade I will be looking to trade.
We expect the U.S. Dollar to continue to fall against the Canadian Dollar after breaking below and continue to test the neckline. Assuming that zone holds up, I currently remain bullish on the Canadian Dollar. Both the Bank of Canada and the CFTC present an interesting tidbit. From the investor side, the net short position of the Canadian Dollar contracted for 42K to 35K. The Bank of Canada also sees an encouraging economic scene, but more confidence in business investments are needed. This is a key pair I will be watching for the week ahead.
Stay tuned for more chart setups.