Central bank expectations will be the main focus in the week ahead, with new Fed Chair Powell testifying on Capitol Hill on Tuesday. In our opinion the dollar may maintain some upside bias in the near term as Powell’s speech before the House Financial Services Committee is unlikely to strike a dovish tone.
This is how our forex trading strategies look like:
EUR/USD
Trading strategy: Short
Open: 1.2300
Target: 1.2180
Stop-loss: 1.2360
Recommended size: 2.73 mini lots per $10,000 in your account
Short analysis: The EUR/USD remains capped by the 30-dma, which is currently at 1.2346. This should keep the overall bias on the downside. 14-day momentum remains negative, reinforcing the overall bearish market structure. We remain short at 1.2300 for eventual losses to 1.2180. A daily close above 30-dma will defer.
Previous position: Long opened at 1.2220, profit taken at 1.2380, earned: 160 pips, $320 per $10,000 in your account
GBP/USD
Trading strategy: Await signal
Open: -
Target: -
Stop-loss: -
Recommended size: -
Short analysis: Last week's action delivered a bull close and set up a stronger bullish impulse early Monday. Daily kijun initial resistance is at 1.4055 and 61.8% Fibo off 1.4279-1.3558 drop. Break of the Kijun opens up recent 1.4145 high. Slow stochs are rising steeply, but the upward move was not continued later on Monday. We think current signals are not strong enough to open a new position
Previous position: Long opened at 1.3780. Profit taken at 1.3980, earned: 200 pips, $272 per $10,000 in your account
USD/JPY
Trading strategy: Short
Open: 107.80
Target: 104.80
Stop-loss: lowered to 107.40
Recommended size: 1.43 mini lots per $10,000 in your account
Short analysis: The USD/JPY skew remains on the downside, as the 108.01 Fibo, 50% retrace of the 110.47 to 105.56 February fall, managed to stymie bulls last week. 14-day momentum remains negative, reinforcing the overall bearish market structure. We remain short at 107.80, our trailing stop has been lowered to 107.40 to lock in a small profit.
Previous position: Short opened at 110.00. Profit taken at 107.50, earned: 250 pips, $304 per $10,000 in your account
USD/CAD
Trading strategy: Await signal
Open: -
Target: -
Stop-loss: -
Recommended size: -
Short analysis: The USD/CAD dropped after Canadian inflation data beat expectations. 7-day exponential moving average at 1.2625 is an important support now. Bears need a move below that level and 200-hourly moving average at 1.2599 to regain momentum.
Previous position: Short opened at 1.2650. Profit taken at 1.2600, earned: 50 pips, $67 per $10,000 in your account
AUD/USD
Trading strategy: Short
Open: 0.7845
Target: 0.7740
Stop-loss: 0.7895
Recommended size: 3.00 mini lots per $10,000 in your account
Short analysis: Our short remains but it’s struggling after the pair reached daily high at 0.7893. On the other hand, the prices holds below the 14-day EMA and RSIs are biased down. We still target 0.7740, which is just above the 61.8% retrace of the December-January rally.
Previous position: Long opened at 0.7785. Profit taken at 0.7800, earned: 15 pips, $24 per $10,000 in your account
EUR/GBP
Trading strategy: Await signal
Open: -
Target: -
Stop-loss: -
Recommended size: -
Short analysis: The EUR/GBP falls further below the 100 and 200-day SMAs and daily RSI is biased down. Monthly RSI is biased up though. Signals are a bit mixed. We will wait for clearer signals before entering a position.
Previous position: Long opened at 0.8865. Stop-loss hit 0.8800, lost: 65 pips, -$100 pips per $10,000 in your account
Source: MyFXspot.com