Like the title of this blog suggests, making pips in the Forex is easier said than done. This "reality blog" will allow you to follow my life as a Forex trader. I'll not only discuss trades, but also my emotions during these trades. You'll see my ups and downs, my highs and lows, and my smiles and tears.
This is the true story of one man, picked to live in front of his computer screen and find ways to make money off the Foreign Exchange. See what happens when markets stop being polite, and start being real! Traders Anticipating Tomorrow's NFP Report
Today was a fairly quiet day considering that the ISM Manufacturing Index and the Core PCE price index was lower than expected. My guess is that the markets are waiting for tomorrow's NFP report to take any action. The NFP usually causes very volatlie movement and as a result, I will refrain from giving any trade ideas since the fundamental power of the report will most likely shadow any technical analysis. Instead, I'd like to look at the charts and see what could happen tomorrow...
Chart Analysis:
EUR/USD
Yesterday I said that the Euro would probably hit 3050 before moving back down, and that's exactly what the pair did today. Now we're seeing the price stall in between 3000 and 3030 (38% Fib line). 4hr stochastics are trending down after having just left overbought territory while daily stochastics is just now entering overbought territory. To me this means that it's pretty much a toss up at this point. If NFP is surprisingly positive, then the pair will probably drop to its 4hr 50 EMA at 2975 and maybe even as low as its 100 SMA which is around 2950. On the other hand if NFP is surprisingly negative, then the pair will probably making a run towards 3100.
GBP/USD
The Cable has been making erratic intraday movements for the past 3 days. Notice the long spikes on the past 3 daily candles. Stochastics on the daily chart are trending up but the 4hr stochastics are in overbought territory and have crossed down. Like the Euro, the technicals are pretty much showing a standstill for the pair. Tomorrows NFP will play a key role in the future direction of the Cable. If NFP is good, the pair may drop back down to its 61% Fib line and if NFP is bad, then we could see the Cable get as high as 9800.
USD/CHF
Yesterday I talked about how the Swissy would face some tough support just below 2400 because of the 3 moving averages that are just hovering in that area. Today, the Swissy met its first obstacle, the 100 SMA, and got rejected back. The pair is currently around 2440. I'm seeing conflicting stochastic readings with the 4hr stochastics trending up (just heading out of oversold territory) and the daily stochastics trending down with plenty of room before reaching oversold territory. Yesterday's daily candle formed a doji which indicates a reversal (according to the technicals), but again, I think this is a sign of traders waiting for the NFP report tomorrow since neither the buyers or sellers won the battle today. If NFP is good, look for the Swissy to make another run at 2500 and "possibly" a break of that level. If NFP is bad, then I expect the Swissy to at least make it to its 3rd support obstacle-- the 200 SMA.
USD/JPY
Like the rest of the majors, the Yen is showing indecision right before the NFP report. Today's candle formed somewhat of a doji which tells me that the market is waiting until tomorrow to make any decisions. If NFP is bad, I can see the pair heading back down to 120.00, and if the NFP is good, then we could see the pair shoot back up to 122.00. The Yen has been very fragile lately, so a positive US report could mean another beating for the Yen.
