EUR/USD rose as the Fed announced that it was keeping rates on hold until the middle of 2013. This sets up the USD for more weakness over time, but in the interim, the markets will continue to be nervous as there are so many unknown variables out there right now. The EUR/USD is still in the downward channel, and as such – we only sell at this point. If we can break the 1.45 level, we would have to reassess our opinion. We are looking for weak candles to sell at this point.
The USD/JPY pair managed to pierce the 77 level during Asian trading, but fears of an intervention took over the psyche of the markets as traders would not push the BoJ any harder. This is probably going to be a bit of a floor for the pair for a while, and as such – we will not sell. In fact, we are looking for supportive candles at this area to buy for a short-term trade.
The GBP/USD pair had an absolutely wild day on Tuesday as trader pushed and pulled the pair, only to end the day unchanged. The recent price action suggests that the cable is happiest between 1.65 and 1.62, and the price action on Tuesday does little to change that opinion. We think that this pair will be choppy for a while, and that the market will more than likely be a short-term trade scenario as we reach both of the above mentioned levels.
The USD/CHF pair fell hard on Tuesday, as the global markets have been out of control. The pair even went so low as to test 0.7050, and the trend is certainly intact after Tuesday’s action. However, we feel that the pair is oversold, and are looking for a rally to sell into in order to profit from the obvious downtrend. We are especially interested in selling near 0.75 if we get the chance.
The EUR/CHF pair continues to keep falling. The pair even went so far as to approach parity during the Tuesday session. We have long said this pair was going to parity, but are truly surprised at how fast this is happening. The pair is still “sell only”, but we expect a bounce at this point as it is simply oversold. We will wait at the 1.05 and 1.07 levels to see if we get a weak candle.
The AUD/USD pair had a wild day on Tuesday as traders first sold off the Aussie, and then returned to buy it up later in the session. The pair even went slightly below parity for a while during the Asian session, but popped back up as the markets began to rebound. By the time it was said and done, the pair travelled in a 500 pip range. The pair is heading right into the 1.05 area, which could be very resistive. We are happy to simply watch and wait until the pair decides this next hurdle before we get involved as the move has been far too volatile for safe trading.
The USD/CAD pair slammed into the parity level on Tuesday as traders sold off everything risk related. However, as the Asian markets stabilized we saw the risk trade put back on and as such, the Loonie was bought back up. Oil rose, and this always puts pressure on the Loonie – which is exactly what happened on Tuesday. We the trend is down and we suspect that although the 0.98 level might serve as some kind of support – this pair ultimately goes down again.
The NZD/USD pair fell, and then rose again as the market sentiment around the world changed wildly over the course of Tuesday. The pair eventually ended the day higher – and in fact had been in a 400 pip range. The 0.85 level just ahead could be resistance, and as such – we want the market to decide if it will hold before we place any new longs.
The EUR/USD pair fell on Monday, continuing the downward pressure that we have seen in this market for a while. The two purple lines on the chart point out how this pair has gradually fallen over the last several months. This pair is a “sell only” pair now, and as such we don’t buy. The idea of owning whatever issues going on in Europe is ridiculous. The pair may bounce, and if it does – we sell.
The AUD/USD fell yet again on Monday. The pair simply cannot get out of its own way, and now finds itself at a massive support area. If this area cannot hold – we are going to really fall out of bed at this point. The 1.02 level was a massive resistance area before, and a break of it started another bullish run towards all-time highs. There is plenty of support in this area, now we need to see a supportive candle in which to buy. If we can get to parity and below – this will start a new bearish trend in this market.
NZD/USD fell on Monday, as traders shunned anything related to risk. The pair looks like it is going to run down to the 0.8000 level, and it is at that area that we will see a lot decided. The bullish trend is still intact believe it or not, but we are starting to get to a point that you really have to question this. The 0.8000 mark will make or break this pair in our opinion.
GBP/USD fell hard on Monday as the “risk off” trade came into vogue again as a result of the US downgrade. The pair was near the top of the recent consolidation area, in the form of the 1.65 zone. Because of this, the market was already “leaning” in a downward direction and it only took a little bit of bad news to get the riskier Pound to sell off. However, we feel that the 1.63 area is support, and this pair will more than likely continue to chop around in this 200 pip zone for a while.
USD/JPY fell again on Monday, as traders sold off everything risk related. In fact, the Dow fell over 600 points, and as such – the “risk off” trade came into play. The Bank of Japan has made it well-known that they are considering another intervention, so we aren’t involved in this pair. In fact, it looks like the 77.50 area could be a natural support level. If we had to take a position in this pair – we would perhaps buy. But luckily for us, we don’t have to be involved in this pair at all.
USD/CAD rose yet again on Monday as the oil markets continue to fall. The oil markets control the fate of the CAD, and as the Light Sweet Crude market is sitting right at $80 – we can monitor that to decide how to trade this pair. The $80 level is key for oil, and if it gives way, this pair will rise as the Loonie falls in value. The parity level is just above, and one cannot help but think it should be massively resistive. We are waiting to see if we get to it, and would be very interested in selling the pair at parity.
The EUR/CHF pair fell on Monday as traders ran from anything related to risk in the marketplace. The pair is inversely correlated to the price of gold, which rose $70 during the session, so there is no surprise this pair fell. The trend is down, and we continue to sell this pair with the belief that it will eventually head towards parity.
The USD/CHF pair fell on Monday, but managed to bounce a bit towards the end of the session as the Dollar got a little bit of a bid at the 0.75 level. The pair is in a bearish trend, and the truth is that we will not buy this pair, and as a result we wait to see if we can get a bounce in which to sell. A break to new lows gets us selling as well.
The EUR/USD pair rose on Friday as traders dumped the USD around the markets. The pair stopped short of the 1.4350 area. The pair has been very volatile, and as such hasn’t been one of our favorite pairs to trade. The Euro has an almost uncountable amount of issues behind it, and because of this we won’t buy this pair. If we get a nice sell signal at either 1.4350 or 1.45 – we will not hesitate to do so.
The USD/JPY pair fell on Friday as traders sold the Dollar off in the US session. The pair is decidedly bearish, but let us not forget that the Bank of Japan intervened recently. The pair is dangerous to short, as the BoJ has stated publicly that they are talking to other central banks to help with another intervention. This pair could be bought – but we need a supportive candle to do so.
The GBP/USD pair rose on Friday, as the Non-Farm Payroll numbers came out with an addition of 117,000 jobs in July. The market seems to be stuck in a range between 1.62 and 1.65, and as such, we feel that the market will stay in that range. Because of this, the market being at roughly 1.6380 tells us that we will more than likely get a shorting chance soon. We look to sell weakness near 1.65 on a weak candle.
The USD/CHF pair had a wild day during the Friday session, but eventually ended up fairly unchanged in the end. The pair is a “sell only” pair as far as we are concerned, and as such are waiting to see one of two things: Either a break of the Friday lows in order to get short or a bounce to 0.80 in order to sell. We will not buy this pair as the trend is far too strong to fight.