Trade setups while awaiting this week’s Non-Farm Payrolls – April 30, 2017

Much to everybody’s surprise, Trump delivered the initial details to his tax reform plans last Wednesday. Not surprisingly though, the plan lays out broad points and not so much “legislative text” as Business Insider puts it.

Here is a quick look at everything that happened last week:

  • Trump continues to reinforce plans to re-negotiate NAFTA and favor bi-lateral trade agreements
  • Tax brackets reduced from 7 to 3, but no exact income figures have been figured
  • Lowering of corporate tax rate from 35% to 15%
  • U.S. GDP growth rate increased less than expected to 0.7% missing expectations of 1.1%

US GDP Q1

Last week’s Q1 GDP growth rate marks the second quarter of slowing economic growth. The market has seen a mild reaction to this weaker figure with the U.S. Dollar remaining short-term bearish. It remains arguable as to whether Trump’s tax reform and re-negotiated trade agreements will indeed spur further economic growth.

Nevertheless, here are this week’s technical setups I will be watching leading up to Friday’s Non-Farm Payrolls. Unlike last week’s (to what I consider to be) rather low volume on Monday and Tuesday while awaiting for Trump’s tax reform, this week features a string of economic releases tradable via short-term setups.

EURUSD 1-Day

On the daily time-frame, EURUSD continues to remain bullish. Last week opened on a very bullish note and we’ve observed a smaller open today, but so far that gap hasn’t been filled unlike the AUDUSD pair. Before we move on, here’s a look at the hourly range I’m monitoring for the time being.

EURUSD 1-Hour

Currently, I have no intentions of placing any trades on this pair given that it’s ranging in nature. This is indicated through the fluctuation between the support and resistance zones, but as well as the overlap in the longer and shorter exponential moving averages. For now, this pair remains a monitor with a bullish bias provided that the daily level holds up.

AUDUSD 1-Day

I actually entered this trade last week hoping to scalp a long position, but overall decided to hold it over the weekend given the positive swaps that can be accrued. The daily time-frame provides a bearish sentiment given how this pair has broken down a key neckline. If this line at the 0.75~ price level holds up, we can expect this pair to be met with significant resistance. I have this long position open for short-term bullish sentiment.

AUDUSD 1-Hour

Meanwhile, the hourly indication features a gap down on open and a quick recovery filling up the gap. This pair seems to have stalled with a mix of indecision as the market determines whether the resistance zone should hold up against the demand filling up the gap. For now, it is my intention to close at worst case with a slight loss or break-even if possible.

USDCAD 1-Hour

Finally, this is a longer term trade opportunity I’m looking to take advantage. As you can see on the hourly time-frame, USDCAD has been in a significant uptrend with dips followed by quick recovery. This could be a potential setup for another swing long entry.

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