Midweek Market Prep
We didn’t see much action on Monday thanks to the lack of economic data, but the G7 meeting more than made up for it on Tuesday.
A G7 official caused ruckus on USD/JPY and other dollar pairs when he clarified that their official statement should be read as “We’re not happy with the BOJ right now.” This is mostly why the high-yielding currencies were able to pare their intraweek losses versus the Greenback.
For the next couple of days we’ll most likely see more locking of horns by the central bankers, especially when the BOJ’s rate statement is just around the corner. Will Shirakawa temper the BOJ’s jawboning? If he doesn’t, how will the other central banks react? Get your popcorn ready, folks.
Also watch out for major reports such as the U.S., U.K., and New Zealand retail sales as they could move price action in the absence of speeches from financial leaders.
That’s it for me today! I’m still looking for a trade setup this week but I have a feeling that I’ll end up trading this oh-so-tempting NZD/USD setup from yesterday. What do you think? Got any other setups or tips?
Potential Trade Setups
AUD/USD: Downtrend still intact!
AUD/USD has been trending lower these days and a falling channel has formed on the 1-hour time frame. The pair is testing the bottom of the channel but stochastic is currently in the oversold area, suggesting a potential bounce. If that takes place, AUD/USD could climb to the top of the channel around 1.0300. See the setup
USD/CAD: Going uphill?
USD/CAD seems to be headed further north as the pair bounced from the bottom of the rising channel on the 4-hour chart. Now that the pair is moving close to the middle of the channel, stochastic has reached the overbought region. Unless Loonie bulls charge, the pair could still stay on track to reach the top of the channel. See the setup
NZD/USD: Rising wedge to break?
NZD/USD has been consolidating even more tightly for the past few weeks as the pair slowly formed a rising wedge on the 4-hour time frame. Resistance around the .8450 doesn’t seem ready to budge anytime soon and it appears that the path of least resistance is downwards. Watch out for a potential break below .8300! See the setup
Comdoll Event Highlights for February 11-15, 2013
With China celebrating its Spring Festival this week, the comdolls will likely trade on risk sentiment and economic reports. I’m leaning towards risk sentiment though, as Australia’s business and consumer confidence and New Zealand’s business PMI are the only reports scheduled for printing.
So which direction do you think will the comdolls go? Will last week’s poor data continue to reflect in the Aussie, Loonie, and Kiwi’s price action or will the comdoll bulls put on some muscle and recover some of their losses?
If you’re like me and you’re still unsure where the comdolls will go, maybe a look at the potential inflection points on AUD/USD, USD/CAD, and NZD/USD will help us out.
Significant Levels to Watch Out For
| AUD/USD | USD/CAD | NZD/USD | |
|---|---|---|---|
| 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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