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FX Weekly: EUR, JPY, GBP, SPX, WTI Outlook

By Brian TwomeyMarket OverviewJul 03, 2022 12:57PM ET
FX Weekly: EUR, JPY, GBP, SPX, WTI Outlook
By Brian Twomey   |  Jul 03, 2022 12:57PM ET
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Since the start of time and markets, central banks traded by percentages or per centum, meaning for each 100 or in fractions of 100 as 1/100. Established were the fractional principles to percentages from 0 to 100 and many percentage points. Seen from percentage points today are Fibonacci's 23%, 38%, 50%, and onward.

Karl Friedrich Gauss revolutionized trades, trading, and markets by inventing the bell curve, the normal distribution, the standard distribution, and the standard normal derived from the concept of Bi as in a 2-way binomial distribution. Bi, as in a normal distribution of market prices, refers to highs, lows, and linear.

The true revolution was a breakdown of the bell curve to factor means, medians, modes, Z Scores, T Scores, Probabilities, deviations, and percentages. Skew, kurtosis, variation. Long list. 

Produced from Gauss and adopted by central banks was the simple moving average, or my term, averages that move. The three basic principles of moving averages are up, down, and linear. Linear refers to neutral or the price point when up and down as a forecast is a 50/50 proposition.

As I’ve been working with concepts of Gauss for the past 14 years, my market terms were invented based on Gauss. A breakpoint is not only a moving average but describes the price action to an average.

Suppose a price breaks a moving average up or down, then the price trades quickly to the next price point. A price point is a level or a statistical point located inside a price path or a distribution of prices. A price path answers the question is price trading usually neutral or not normal and how far prices may travel.

In +98% of circumstances, all market prices usually trade. Exceptions exist to certain days and weeks, but not normal is never far from normal and market prices correct quickly to normalization. A price on approach to a moving average slows then becomes linear or neutral and contains two choices: break above and trade higher quickly or fail to break higher and trade lower quickly.

Working with Gauss’s concepts and moving averages was invented target only trading then the next level was multiple longs and shorts per financial instrument and currency. The next level to trades and trading targets trading and streamlines all Gauss methods. Days, weeks, and months become irrelevant as target to target is the valid concept. Central banks trade by moving averages thanks to Gauss and the endless possibilities to factor trades.

Last Week's Trade Results

XAU/USD: Target 1857. Actual 1843. Then short to target 1808. Actual 1784. This week targets 1857, then shorts to 1759.

XAU/EUR: Target 1766, actual 1755. Then Shorts target 1717. Actual 1710. This week targets 1766 and 1698.

United States 10-Year Yield: Target 3.38, actual 3.26. Then short of targeting 2.94. Actual 2.78. This week targets 3.38 and 2.66.

S&P 500: Target 3960, actual 3946. Then short to 1.3600’s. Lows 3726. This week 3999. and 3600’s again as same bottoms as last week. SPX is trapped inside the 3900’s to 3841.

USD/JPY: Target 136.00’s again achieved destination for two straight weeks. Short target 133.64. Lows 134.72. Profits were achieved. However, the downside was light to targets. This week targets 133.84 on a break of 134.59 from short 135.65 and 135.76.

EUR/USD: Target last week at 1.0653 achieved 1.0616 from entry at 1.0498 and 1.0512. Entry never triggered. Lows achieved 1.0546. Long entry Wednesday at 1.0512 and 1.0498 resulted in a EUR drop to 1.0365 or 133 pips from entry. The strategy quickly adds one lot and trades to breakeven on the first lot and profit on the 2nd lot. Wednesday lows at 1.0434 traded to 1.0488.

EUR/USD for the week targets 1.0599 from 1.0384 and 1.0377, then short to 1.0516.

The Week Ahead

JPY cross pairs began the week deeply oversold; however, vital points sit just below. For example, AUD/JPY’s critical level is located at 91.99, and AUD/JPY opens 16 pips above 91.99 at 92.16. NZD/JPY 83.56, EUR/JPY 138.75 and GBP/JPY 160.62. CAD/JPY at 101.00’s is under no threat to break lower anytime soon but instead trades around large ranges.

For weekly trades, CAD/JPY is short 105.40, and 53 targets 103.24. Both JPY cross pairs and USD/JPY begin the week in positions to travel much higher or lower. Do or die for JPY.

US Dollar Index: Last week, 105.00’w were overbought and oversold at 103.00’s. This week's low 106.00’s become overbought Vs. 103.00’s targets. DXY traded last week in its usual 200 pip range. Note EUR/USD target at 1.0599 in relation to DXY being overbought at 106.00’s.

GBP/USD: Favored 3 currencies are GBP/USD, GBP/CHF and GBP/CAD. GBP/NZD as written last week, the big break was located at 1.9434. GBP/NZD broke higher and traded 200 pips. This week’s big break is located at 1.9468. No changes to GBP/NZD since last week.

Easy longs are located in combo’s NZD/CHF and NZD/USD and AUD/CHF and AUD/USD, EUR/USD and EUR/CHF. No thrills to CAD/CHF nor USD/CAD.

WTI Vs. Brent

A meeting of prices last week as both Crude Oil WTI and Brent traded together at 109.00’s. Brent’s position is trading above WTI. Brent from 111.48 is trapped between 114.28 above and 113.12 below. Same position for WTI from 107.00;s to 109.00’s.

Weekly Trade Rankings


FX Weekly: EUR, JPY, GBP, SPX, WTI Outlook

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FX Weekly: EUR, JPY, GBP, SPX, WTI Outlook

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Comments (1)
MONDAY ISHAKU Jul 12, 2022 2:06PM ET
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I love your great work Sir. Keep it up with all this great research everyday. Best regard
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