SC Trading Weekly Report

SC Trading Weekly Report

FX Week In Review

USD

Interesting week in the Dollar, we moved slightly lower even with NFP beating expectations, it was interesting it did not help the Greenback. We finished the week at 96.21 which was a 0.2% drop in the DXY.

EUR

The Euro fell back a bit last week on the back of some data misses, the Euro Zone posted a move in CPI from 1.8% to 1.6% in YoY, this is tricky news for the ECB regarding rates this year. So, the EXY finished the week lower at 113.70.

GBP

Not long now until the UK Parliaments vote on Brexit, but the Pound stood up well last week with little Brexit news.

YEN

The USDJPY continues to look weak, and the flash crash in the Yen pairs saw it drop below 105.00 and we still finished 1.6% down on 108.52, with the Yen in an inverse correlation with risk assets we had a good week!

Precious Metals

We had a fantastic week in gold and silver, but did NFP put pay to the move? Gold made gains of 0.4% closing at $1284.78, plus silver was up 2.0% at $15.70.

The Week Ahead

So, Happy New Year, and the first week (although short) of 2019 was here! And if this is what to expect from 2019 its going to be fascinating, bumpy and fun!!

We had the Flash Crash in the JPY and AUD pairs, the talking heads are calling it Algo driven in a thin market, or perhaps it was bad news out of Apple, which links to a China slowdown.  As a trader, we will probably never know, but then why, is not that important, your reaction to it is! Don’t go chasing trades, big moves get you eager to jump into the markets as you feel you have missed out on a big move and a big chance to make money/pips. The way to look at this is ‘you did not get caught on the wrong side’ and your slow and steady approach of pip accumulation each day is what will make you a successful consistent trader, not the luck of catching a flash crash! 

We also sold off risk assets from the get-go, but equities made a come back and a good recovery. (maybe on the back of Powell stating his independence and patience)

On the news front we see the US still in a partial shutdown, and with fresh talks with China on the horizon, we wait to see the mood music and outcome. With Brexit back in the news as the UK Parliament comes back into session and Europe still dealing with some long-standing problems that are never far from the news like Italy, all this could lead to continued volatility in the markets.

Data wise we have Bank of Canada interest rate decision, with a ‘no change’ expected, it is the statement and sentiment that could move the market. We see CPI prints from the US, Switzerland and a few others.

Major Data Releases

*Data Supplied by fxstreet.com

Currency Pairs to Watch

We have the ‘Trade of the Week’ below and we will be keeping an eye on the Dollar and staying away from the GBP around renewed Brexit shenanigans.

But the EURJPY is of interest, we love the structure of the markets and price, tells us all we need to know, with a perfect example in the EJ was the flash crash happened it fell nearly perfectly to the 7-year trendline and round number of 120. So, we will see if the retracement off the low continues into the 125 area.

We will also be looking at the NZDUSD and seeing if Thursday’s and Friday’s strong candles that combine eclipses Wednesday’s very negative candle will continue a move up above the recent highs into the 0.6789/0.6800 area.

Trade of the Week

So, last week we looked at the USDJPY, we wrote. ‘So, we will look for price to fall below 110.14 into the 109.59 area, with the trade being invalidated with a strong close above 110.76.’

What a great trade last week, we hit our target and even before the flash crash, we actually held into 109.00 and made some good pips.

His weeks ‘Trade of the Week’ we will look at NZDCAD, we will be working from the weekly chart, we can see the move up from the low in October last year, and we have had a steady move up into the resistance area of 0.9214. Where we have had 3 weeks of rejection candles which can be classed as shooting stars, now we have had a very bearish candle breaking 0.9036 the 23.6% fib

We will look for a continuation of the fall below, 0.9000 area into 0.8899 and 0.8821.

Weekly Progress Report

We had a short week with the New Year’s Bank Holiday and NFP, but we had 2 trades, the EURJPY, the EURUSD.

The EURUSD did not trigger, and the EURJPY we wrote We had the flash crash on this pair overnight, but as you can see, we were at 123.15 before this happened so even without the luck of the flash we did well.’ And made 188 pips!!

Please look to Subscribe at https://www.sctrading.co.uk/subscribe for a free 7-day trial. As the New Year will bring some great Daily Trade Ideas!

HAPPY NEW YEAR!

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