Dollar Goes Up One Day….And Down the Next!

After yesterday’s dollar rally, it got its butt kicked today by the majors. We’ve been seeing a lot of range bound movement as of late with the lack of fundamentals. The rest of the week is pretty dry so I’m thinking that the big focus of the week will be the G7 meeting. This will most definitely have the biggest effect on the Yen so keep your eye out on it.

Chart Analysis:

EUR/USD

Well it seems like the Euro is once again stuck inside the 2900-3000 range as it bounced back up near its 50 EMA again on the 4hr chart. The 50 EMA and 100 SMA have been acting like the top and bottom for this channel that the pair has been stuck in for quite some time now. 4hr stochastics are trending up and have just entered overbought territory while the daily stochastics have been crossing up and down in between the overbought and oversold territory. I’m not sure about where the pair will go next but with no major fundamental reports my guess is that it will bounce back down off of 3000 and move around 2900 again. I’m going to hold off on trading this pair for now until I get a clearer picture.

GBP/USD

The Cable is currently resting slightly above 9700. 4hr stochastics are in overbought territory while daily stochastics are still trending up with plenty of room before reaching the overbought territory. Today’s movement was one-sided in favor of the Pound and usually when you have a big green candle like this on the daily chart, it usually means the next day will be a continuation of that trend. My guess is that the pair will at least head to 9750, and I wouldn’t be surprised if it got to 9800. I think I’m going to go long at 9720 with a stop below 9700. I’ll set my initial target for 9750, but I’m really setting my sights anywhere between 9770-9800. I’d recommend trailing your stop once the price hits 9750, 9770, and then taking final profit if the price gets to 9800 or very close to it.

Trade Idea:

Buy at 9720; Stop Loss= 9690; Initial target= 9750; Target 2= 9770; Final Target= 9800

USD/CHF

The Swissy fell nice today and now it’s resting at some pretty good support areas. First of all, it’s right at the 200 SMA on the 4hr chart. Coincidentally, this also happens to be where the 100 SMA and 50 EMA are on the daily chart. Stochastics on the 4hr chart are in oversold territory which adds to the idea that the pair will bounce up in the short term. The only contradicting signal is that the daily stochastics are still trending down with more room to go before reaching oversold territory. If the price can break past its 50 EMA on the daily chart, then there is a good chance it will reach its 200 SMA at around 2350.

Trade Idea:

Short at 2370; Stop Loss= 2400; Target= 2350

USD/JPY

The Yen is also resting at a good support level. Not only is it at a 00 level (120.00), but it also is testing the 200 SMA on the 4hr chart. Daily stochastics have entered oversold territory but there could be a little more selling pressure. Right now it looks like it’s a coinflip. Either the pair will bounce back up to around 120.50 or it will break its support and head to its 50 EMA on the daily chart which is at 119.50

  • yuna1718

    thx for the informations , really it’s so important to look at daily chart,,, iam using ur system in trading and asking. do u use 50 EMA and 100 SMA only with the daily chart ???
    and thx for every thing .

  • yuna1718

    thx for the informations , really it’s so important to look at daily chart,,, iam using ur system in trading and asking. do u use 50 EMA and 100 SMA only with the daily chart ???
    and thx for every thing .