*As at 22.00 Hrs BST on Sunday 5h November 2017
HOW TO USE:
Try cross-referencing the above 6 currencies: i.e take the strongest and the weakest and open the corresponding chart. So for example, if USD is the strongest (S1) and JPY is the Weakest (W1), open the USD/JPY chart on the daily timeframe and see if price action agrees.
You don’t have to stick to the No1 crosses either: There are 9 potential currency crosses here, so maybe pair the 2nd strongest (S2) with the 3rd weakest (W3) and see what the chart throws up.
THIS WEEK’S CHOICES, CHARTS, OPINIONS, CAVEATS & MORE…
NZD / USD Short (Weak 1 Vs Strong 1)
As sited last week, we waited for some short profit taking which we again called to perfection at the 0.6850 handle.
This week our analysis still shows S1 USD and W1 as NZD. Despite this we will sit on the side-lines until 0.6850 is retested.
I still maintain there to be substantial downside potential for this instrument but wish to see current support tested and broken before I take a position and commit my account.
EUR / AUD Long (Strong 3 Vs Weak 3)
Sometimes I just love my job !
Here we have a fascinating chart to play with. One of the best examples of a near 9 month ascending triangle I have seen in quite sometime – a near perfect rising trend line in play since late February capped by multiple tests of resistance at the 1.5230 handle and a fakeout (false breakout) to boot.
I see such a pattern as a showing upside potential and this is born out by the ascending triangle pattern being widely seen as a continuation pattern, effectively building pressure toward the upside.
Lets face it, this pattern cannot stay in play for much longer, something has to give. I’m widely know for stating the obvious in that price can only go in one of three directions, Up, Down or sideways. In this case price has to either move to the upside breaching resistance, to the downside breaching rising trend line support, or sideways, again breaching rising trend line support to establish a trading range.
Perhaps this weeks RBA(Reserve Bank of Australia) rate decision due in the early hours of Tuesday morning (details HERE) will provide the impetus for the bulls to see the prior move through this time. A word of caution though: At present market analysts expect the RBA to hold interest rates as they are at 1.5%
© TradingHUB 2017 – All rights reserved