It’s halftime, folks! How are the major currencies faring this week and what else can we expect from the markets?
Midweek Market Prep
Woah, I’m seeing a lot of red these days! Most major currencies, except for the Australian dollar, are reeling from losses against the safe-haven U.S. dollar so far this week as bailout concerns in Cyprus weighed on risk sentiment. Last time I checked, the Cypriot parliament rejected the recent bailout proposal, which puts the euro zone nation back at risk for a default!
As I mentioned in my market preview, the main event risk for the week is the FOMC monetary policy statement scheduled today. Recall that the Fed previously hinted that they are considering tapering off asset purchases but Big Ben said that tighter monetary policy isn’t likely for now. The upcoming rate decision should set the record straight and possibly result in huge moves among the dollar pairs.
Do keep an eye out for the upcoming NZD quarterly GDP release during tomorrow’s Asian session as well, especially if you’re thinking of trading NZD/USD. Be careful out there!
Potential Trade Setups
AUD/USD: Mid-channel Bounce
Given how comdolls often pop up channels I feel excited about this one. AUD/USD is being supported by a mid-channel level while Stochastic is also hanging around in the oversold area. I could place my stop at the day’s low and aim for the top of the channel for a good R:R. See the setup
USD/CAD: Trend Line Support
If you like trading trends then you’ll be happy to see that USD/CAD’s rising trend line is backed up by a possible 38.2% Fib support on the daily chart. Stochastic is almost oversold, too, so you might want to place your long orders if you think that the Loonie is still headed south. See the setup
NZD/USD: Resistance at .8270
Big Pippin and I have talked about this a few hours ago and we have agreed that NZD/USD’s .8270 area is a good place to short if you’re a comdoll bear. A tight stop above the level could give you good trading odds especially if you aim for last week’s low. See the setup
Comdoll Event Highlights for March 18-22, 2013
There aren’t a lot of major economic reports due from the comdoll economies this week, except perhaps for the New Zealand GDP due Wednesday and the Canadian retail sales data set for release on Thursday.
The main even for the week will most likely be the FOMC monetary policy statement on Wednesday as the Fed’s stance on monetary policy could set the tone for the rest of the trading week. Be mindful of traders pricing in their expectations ahead of the actual event, too!
Significant Levels to Watch Out For
|Week Open (WO)|
|Previous Week High (PWH)|
|Previous Week Low (PWL)|
|Top Weekly ATR (tWATR)|
|Bottom Weekly ATR (bWATR)|
|Other significant levels|
In case you’re wondering what ATRs are all about and how I computed those figures, make sure you check out my entry explaining my trading strategies.
Chips, dips, and lots and lots of pips!
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