Comdoll Trading Kit (March 26-30, 2012): Midweek Market Analysis

It’s that time of the week, fellow forex fanatics! Let’s take a look at the economic themes that have been dominating markets so far this week.

Market Themes

Big Ben signals possibility of QE3
Ben Bernanke fired up our charts at the start of the week when he hinted that the recent improvement in the jobs sector is still not sustainable, and that more stimulus might be necessary. The possibility of QE3 took its toll on the dollar and boosted high-yielding currencies across the board. In fact, this is one of the reasons why my NZD/USD worked out so well! Whoo!

EU officials to increase firewall?
Despite concerns about the region’s rising bond yields, the euro has been resilient against its counterparts thanks to talks of Germany softening its stance on increasing the region’s rescue fund by 200 billion EUR. Will we hear more about this issue in the next couple of days?

U.S. data disappoint expectations
Just when we thought that the U.S. economy is on its way to recovery, disappointing reports like yesterday’s CB consumer confidence, Richmond manufacturing index and S&P Case-Schiller price index pop up to knock investor confidence back by a few notches. How much disappointment can traders tolerate before we see risk aversion in markets?

Comdoll Review

Comdolls

Enough about the U.S. and the euro, let’s talk about the comdolls!

The high-yielding Aussie, Loonie, and Kiwi enjoyed a nice rally early in the week as the dollar fell on Bernanke’s comments. Unfortunately, a report from China rained on the comdolls’ parade when it showed that company profits fell for the first time since 2009. Yikes!

Right now all of our comdolls are about 20 pips from their respective week open (WO) prices, so it looks like it’s still a fair game over the bulls and bears for the next few days. Which side are you on? Are you projecting a risk on mode until the end of the week, or will the dollar take back its crown as the king of pips?

That’s it for me today! Please tell me if I missed any major theme, okay? Oh, and while you’re at it, why don’t you share some setups that you’re looking at? Who knows, maybe I’ll have you to thank for if I win my next trade!

Looking forward to hearing from you!

Comdoll Event Highlights for March 26-30, 2012

Calendar

In terms of economic releases, it looks like the comdolls could be off to a quiet start this week as no top-tier releases are scheduled until Wednesday. Be mindful though that Fed Chairman Ben Bernanke is set to deliver a speech on the recent developments in the U.S. labor market, which could spark some volatility in the charts later today.

The second half of the week could be more exciting for the Aussie, Kiwi, and Loonie as a few medium-tier releases are on tap. If you’re planning to trade the news, the NBNZ business confidence reading and the Canadian monthly GDP release could spur strong moves for NZD/USD and USD/CAD.

Now let’s take a look at the significant inflection points on our comdoll charts:

Significant Levels to Watch Out For


AUD/USD USD/CAD NZD/USD
Week Open (WO)
1.0463
0.9983
0.8176
Previous Week High (PWH)
1.0638
1.0035
0.8289
Previous Week Low (PWL)
1.0336
0.9860
0.8059
Top Weekly ATR (tWATR)
1.0587
1.0069
0.8278
Bottom Weekly ATR (bWATR)
1.0339
0.9906
0.8074
Other significant levels
1.0450, 1.0500
0.9900, 1.0050
0.8200, 0.8250

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.

Alright, that’s it for me today! If you want to ask or share anything, just tell me, okay?

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Good luck on your trades this week!

Happy time

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What is STA strategy? Gold, Oil, and Comdoll Previews for 2012 Comdoll Trading Kit (March 19-23, 2012) NZD/USD trade

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