General Market Outlook - June 21st, 2014
Note: I got rid of NZD/USD and USD/CHF. NZD/USD pretty much correlates with AUD/USD while USD/CHF correlates with EUR/USD, so I figured it was redundant to analyze both pairs.
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Interesting Pairs:
AUD/USD - Bearish
- Price tested the broken trend line last week and bounced down
- Price retested the same price level this week and started to bounce down
- Personally, I wouldn't short now because it would effectively be chasing. It dropped about 50 pips so far, so you would need a wide stop to enter this trade now.
- Maybe if it retraced to 0.94, I would consider it but AUD/USD isn't high on my "to trade" list right now.
GBP/USD - Bearish
- Although not a perfect butterfly (aka bearish gartley), price did bounce off the 161.8% fib level this week around 1.705X
- Since price closed above the 1.7000 level on Friday, I expect bulls to have another push towards 1.705X or even 1.71.
- So if you missed the entry at 1.705X (like I did), don't worry, you 'should' get another chance
- Although the level of interest is at 1.705X, I'd prefer loading the majority of my short position closer to the 1.71 level if we get there.
USD/CAD - Bullish
- Price broke out of the descending triangle on Friday (magenta) but this bear run looks exhausted, USD/CAD has been dropping for most of the last 3 weeks already.
- Currently price is sitting at the 1.075X level, which happens to be where the (blue) trend line is, so loading a few longs here wouldn't be a bad idea.
- However, the level that I'm interested in is the 1.07 level, which is where the (red) trend line intersects with a previously broken resistance level.
XAG/USD - Bearish
- Price broke the blue descending trend line this week and surged upwards but until we break 21, I have doubts about this bull run.
- Take a look at the red descending trend line, price fell around $23 the first time and $22 the second time, what are the odds the price will fall around $21 this time?
- Each time price has dropped in the past, it went all the way down to the support level at 18.6X.
- I'm not saying it's going to drop back down to support again this time but at the very least, I expect a retrace back down to the $20 level to test the broken trend line. After that, who knows?
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Developing Pairs:
USD/JPY - Waiting for breakout
- The only thing that I can see right now is a symmetrical triangle, which is a neutral pattern formation until it breaks out
- So until it does, I'm sitting on the sidelines for this pair
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Confusing Pairs:
EUR/USD - Conflicting short and long term views
Long term - I see a potential bearish flag on the chart, which signals continuation drop is coming?
Short term - A retrace wouldn't be out of the question for a healthy bear run but it would have to break the bear flag in order to do so, which conflicts with the long term view. Also, price never hit 1.4000 so that's a bull target that was never reached.
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Disclosure: All open positions are disclosed above, if I don't mention having one then it should be assumed at all times that I plan to trade based on my analysis, so take this into consideration as I may be biased.
-------------------------------------------------
Interesting Pairs:
AUD/USD - Bearish
- Price tested the broken trend line last week and bounced down
- Price retested the same price level this week and started to bounce down
- Personally, I wouldn't short now because it would effectively be chasing. It dropped about 50 pips so far, so you would need a wide stop to enter this trade now.
- Maybe if it retraced to 0.94, I would consider it but AUD/USD isn't high on my "to trade" list right now.
GBP/USD - Bearish
- Although not a perfect butterfly (aka bearish gartley), price did bounce off the 161.8% fib level this week around 1.705X
- Since price closed above the 1.7000 level on Friday, I expect bulls to have another push towards 1.705X or even 1.71.
- So if you missed the entry at 1.705X (like I did), don't worry, you 'should' get another chance
- Although the level of interest is at 1.705X, I'd prefer loading the majority of my short position closer to the 1.71 level if we get there.
USD/CAD - Bullish
- Price broke out of the descending triangle on Friday (magenta) but this bear run looks exhausted, USD/CAD has been dropping for most of the last 3 weeks already.
- Currently price is sitting at the 1.075X level, which happens to be where the (blue) trend line is, so loading a few longs here wouldn't be a bad idea.
- However, the level that I'm interested in is the 1.07 level, which is where the (red) trend line intersects with a previously broken resistance level.
XAG/USD - Bearish
- Price broke the blue descending trend line this week and surged upwards but until we break 21, I have doubts about this bull run.
- Take a look at the red descending trend line, price fell around $23 the first time and $22 the second time, what are the odds the price will fall around $21 this time?
- Each time price has dropped in the past, it went all the way down to the support level at 18.6X.
- I'm not saying it's going to drop back down to support again this time but at the very least, I expect a retrace back down to the $20 level to test the broken trend line. After that, who knows?
-------------------------------------------------
Developing Pairs:
USD/JPY - Waiting for breakout
- The only thing that I can see right now is a symmetrical triangle, which is a neutral pattern formation until it breaks out
- So until it does, I'm sitting on the sidelines for this pair
-------------------------------------------------
Confusing Pairs:
EUR/USD - Conflicting short and long term views
Long term - I see a potential bearish flag on the chart, which signals continuation drop is coming?
Short term - A retrace wouldn't be out of the question for a healthy bear run but it would have to break the bear flag in order to do so, which conflicts with the long term view. Also, price never hit 1.4000 so that's a bull target that was never reached.
-------------------------------------------------
Disclosure: All open positions are disclosed above, if I don't mention having one then it should be assumed at all times that I plan to trade based on my analysis, so take this into consideration as I may be biased.
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