I’m looking at two trade ideas this week and both have good technical setups. Which one should I take?
This one is my anti-dollar setup. Yesterday high-yielding currencies like the euro surrendered pips to the dollar due to escalating concerns over Ukraine, selloffs in the emerging markets, technical breakouts, and overall risk aversion. The move could reverse in a few hours when Fed Chairwoman Janet Yellen takes center stage. If she doesn’t hint at more tapering in her testimony, then we could see a small selloff for the Greenback.
EUR/USD is also technically positioned for a jump. As Big Pippin pointed out in today’s Chart Art, the pair had just bounced from a rising trend line on the 4-hour chart. It also helps for my system that the 100 and 200 SMAs are pointing to an uptrend.
This one’s for the dollar bulls! In case Yellen DOES hint at more tapering later, then we might see the dollar rise. If that’s the case, then USD/JPY bulls will likely push the dollar above 102.70 and complete an ascending triangle breakout. As good as this setup is though, I’m not too excited to buy it at market simply because ascending triangles could still break to the downside (just read the triangle part of the School of Pipsology!).
How about you? Which of the setups above would you rather take? Any tip would be much appreciated!