Thank goodness for weekends! After an upsetting trading week, I think I’m once again ready to take the market head on! Here’s my game plan:
Country-specific events instead of overall market sentiment determined price action in last week’s trading. For instance, the euro fell on speculation of a rate cut from the ECB and disappointing PMI numbers from the region. Meanwhile, the pound rallied following the better-than-expect GDP figures (which stopped me out of my trade! Ugh!).
The dollar also gave up ground to the yen following reports that BOJ members aren’t quite seeing each other eye-to-eye with regards to their 2% inflation target.
We’ll probably see the same behavior from the majors this week given the roster of high-caliber reports that we have on tap. The ISM manufacturing report, FOMC statement, ECB rate decision, U.K. services PMI, and NFP report from the U.S. are all due. So yeah, I’m expecting this week to be pretty action-packed!
EUR/USD seems like it’s still stuck in a consolidation. In fact, if you connect its recent highs and lows, it looks like the pair has formed a symmetrical triangle. Where is it headed? Err, with the roster of top-tier data we have for this week, it can go in either direction! To be safe, I think I will wait for a breakout on the pair before deciding to go long or short.
Given the break of the falling trend line and the strong GDP figures released last week, I can say that I’m strongly bullish on GBP/USD. Unfortunately, I don’t know how I’m going to enter. I’d like to enter soon, but price is extremely extended from both the 200 and 100 SMAs, indicating that a retracement might happen. For now, I think I’ll simply sit on the sidelines and wait for a trade setup to manifest.