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AUD Weekly Review (July 27 – 30)

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We saw mostly negative economic updates and commentary from Australia this week, but the Australia dollar traded mostly mixed through it all. Counter currency flows and broad risk sentiment were likely drivers for the mixed performance. 

Overlay of AUD Pairs: 1-Hour Forex Chart

AUD Weekly Performance from MarketMilk

Australian Headlines and Economic data

Monday:

RBA Assistant Governor Kent gave a speech that covered the global financial conditions and the RBA’s actions during the initial market panic reaction to the COVID-19 pandemic. Overall, the RBA’s operations to support the economy with low borrowing costs and an ample supply of credit seems to have worked well. 

Tuesday:

ANZ: Australia’s consumer confidence dropped 1.7 points this week

Australian employment suffers setback from second virus wave

Wednesday:

Australia announces tighter border restrictions in Queensland

Australian Q2 headline CPI down by 1.9% after earlier 0.3% uptick

Australia’s trimmed mean CPI posted 0.1% dip instead of 0.1% gain

Thursday:

AU June building dwelling approvals slide to eight-year low

Victoria’s COVID lockdown could be extended with Stage Four not ruled out, premier says

Australia Treasury Secretary paints grim picture as economy reels from pandemic

Australia Lowballs Iron Price That Boosts Economy and Budget

Australia Import price index fell -1.9% this quarter; export prices fell -2.4% this quarter

After a negative turn during the Asia session correlating with the terrible Australian updates above, the Aussie dollar bottoms out during the U.S. session and turns a corner heading into the Friday session.  This is likely sparked by U.S. dollar weakness and possibly by the U.S. tech sector rally ahead of big tech earnings.

Friday:

Australia’s PPI fell by 1.2% in Q2 after earlier 0.2% uptick

Australian private sector credit sank by 0.2% vs. projected 0.1% dip

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from Veteran Wealth https://veteranwealthmgntmarketnews.com/index.php/2020/07/31/aud-weekly-review-july-27-30/

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Why Traders Should Get Used to Being Wrong

In trading, entering a position means that you’re confident enough in your idea to bet money on it.

You manage your risks by studying the current economic themes, plotting key chart levels, and preparing for different price reactions.

By the time you enter a trade, you’ll have enough confidence in your biases to bet against the market (you think the current market prices are wrong) and do so with your hard-earned moolah.

This is a good thing.

Being confident in your idea will help your execution. It will help you pull the trigger even when you’re on a losing streak, press trades when needed, and stick to your plans even when you’re tempted to cut corners.

The problem starts when you become too confident in your opinions.

What if, despite your research and experience, you were wrong?

Why you should get used to being wrong

A good reason why you should get used to being wrong is that you will be. OFTEN.

Even the most consistently profitable traders have found themselves on the wrong side of trades. In fact, some traders can have low win rates and still be profitable in the long run.

This doesn’t mean that they were bad analysts or traders. It just means that price had reacted differently than they had projected when they entered the trade. Maybe a new catalyst came along, a report printed unexpected numbers, or maybe a world leader tweeted something explosive.

If you’re not open to being wrong, then also you’re not preparing for a key and inevitable component of trading.

The sooner you accept that your idea is invalidated, the sooner you can channel your energy into minimizing your losses or even flipping your biases.

Last but not the least, being wrong and losing trades can teach you lessons you won’t get from winning trades.

Losing trades, for example, can tell you which assets and strategies to avoid, when you’re risking too much, or what mindset you need to be in to trade profitably. Tracking key trading metrics and using a psychological journal will help you with this.

So, how can you be confident AND open to being wrong?

The key is to recognize that it’s your trading skills – not your trade ideas – that will make or break your account.

If you’re confident that you can manage your risks no matter how price behaves, then you’ll be more open to (and even welcome) being wrong.

If you’re not used to being wrong yet, then you can start by keeping up to date with the market themes and looking out for catalysts that could turn price against your position. Normalize reading opposing headlines and biases as they can help you minimize your losses.

You can also try setting parameters for invalidation before you enter a trade. You can ask questions like:

How long do I expect the price to hit my targets? What will I do if the price hasn’t reached those levels by then?

What if the shorter/longer time frames start pointing in the other direction?

At what price level should I start re-evaluating my biases?

At the end of the day, a trader’s job is not to be right, but to be profitable.

Managing your risks means choosing the best possible odds for your positions, even it means recognizing that your initial trade idea was wrong or invalidated.

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from Veteran Wealth https://veteranwealthmgntmarketnews.com/index.php/2020/07/31/why-traders-should-get-used-to-being-wrong/

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Daily London Session Watchlist: EUR/JPY

The BOJ has been in jawboning mode recently, so I’m looking at this short yen play that’s gaining some momentum.

Think there’s still a chance to jump in this EUR/JPY rally before the end of the week?

Before we talk about the setup, check out the major headlines that moved the markets during the Asian session:

Major FX Pairs Price Performance from MarketMilk

Fresh Market Headlines & Economic Data:

Upcoming Potential Catalysts on the Economic Calendar:

French flash GDP at 5:30 am GMT

U.K. Nationwide HPI at 6:00 am GMT

German retail sales at 6:00 am GMT

Swiss retail sales at 6:30 am GMT

French consumer spending and preliminary CPI at 6:45 am GMT

Euro zone flash CPI readings at 9:00 am GMT

What to Watch: EUR/JPY

EUR/JPY 1-hour Forex Chart

EUR/JPY recently busted out of its symmetrical triangle pattern, indicating that bulls have taken the upper hand.

The pair also seems to be completing its pullback and has gathered enough buying energy to sustain its climb. Note that the triangle spans around 150 pips in height, so the resulting rally could be of the same size.

The Eurozone has a handful of mid-tier reports lined up today, and stronger than expected results could be enough to lift EUR/JPY back up to the swing high and beyond.

On the flip side, the yen has been under some downside pressure after the Japanese Ministry of Finance warned against the rapid yen appreciation.

If you’re counting on a larger pullback, better wait for a retest of the broken triangle resistance to hop in. This coincides with the 100 SMA dynamic inflection point and 61.8% Fibonacci retracement level, where more bulls might be waiting.

Jumping in at market wouldn’t be such a bad idea either, as long as you take note of the average EUR/JPY volatility in setting your exit levels and make sure you practice proper risk management!

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from Veteran Wealth https://veteranwealthmgntmarketnews.com/index.php/2020/07/31/daily-london-session-watchlist-eur-jpy-2/

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Chart Art: Pullback Opportunities on USD/JPY and AUD/NZD

It’s the end of the month and you know what that means! It’s Harry Potter’s birthday, yo!

For traders out there, today also marks the last trading day of the week AND month. This means we could see some profit-taking shenanigans!

Check out these retracement opportunities I’ve spotted on USD/JPY and AUD/NZD today:

USD/JPY: 1-hour

USD/JPY 1-hour Forex Chart

USD/JPY is on its way to the 105.00 major psychological handle after hitting lows just above the 104.00 mark.

As you can see, 105.00 is close to a previous support and the 100 SMA on the 1-hour time frame.

Will 105.00 serve as resistance in the next trading sessions? Or is USD/JPY due for a reversal or at least a longer-term retracement?

Watch how the pair reacts to 105.00. If bulls can’t get past the level, then you can place short orders and then aim for its previous lows or even new 2020 lows with stops above the 100 SMA.

If USD/JPY breaks above 105.00, however, then the pair could hit the 106.50 levels near last week’s support levels.

AUD/NZD: Daily

AUD/NZD Daily Forex Chart

Earlier this week we talked about AUD/NZD hitting its 1.0750 range resistance levels.

Well, it looks like the bulls won that round of tug-o-pips!

AUD/NZD has not only broken above 1.0750 but it has also returned to retest the level.

Are we looking at a break-and-retest opportunity here? Buying at current levels would get you in on AUD/NZD’s upswing if the upside breakout turns out to be legit.

Not comfortable about buying the Aussie against the Kiwi? You can also wait for AUD/NZD to trade comfortably inside the range again and aim for the 1.0650 mid range or 1.0600 range support levels if you’d rather sell the Aussie against Kiwi.

Forex Chart Settings:

Slow Stochastic: 14,3,3 100 SMA: Blue line 200 SMA: Red line

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from Veteran Wealth https://veteranwealthmgntmarketnews.com/index.php/2020/07/31/chart-art-pullback-opportunities-on-usd-jpy-and-aud-nzd/

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Daily U.S. Session Watchlist: AUD/JPY

With economic events up ahead from Australia, China and Japan ahead, will the consolidation on AUD/JPY finally turn into a breakout?

Before moving on, ICYMI, today’s Daily London Session Watchlist looked at an opportunity forming on EUR/USD ahead of German & U.S. data, so be sure to check that out to see if there is still a potential play!

Intermarket Snapshot

Equity Markets Bond Yields Commodities & Crypto DAX: 12331.44 -3.83% FTSE: 5964.55 -2.72% S&P 500: 3220.32 -1.17% DJIA: 26117.59 -1.59% US 10-YR: 0.543% -0.038 Bund 10-YR: -0.546% -0.047 UK 10-YR: 0.084% -0.036 JPN 10-YR: 0.018% -0.002 Oil: 39.32 -4.72% Gold: 1,937.00 -0.84% Bitcoin: 10966.54 -1.49% Ethereum: 317.72 -0.10%

Fresh Market Headlines & Economic Data:

Dow futures drop 200 points amid record GDP decline, tech shares fall before big earnings

Second-quarter U.S. GDP plunged by worst-ever 32.9% amid virus-induced shutdown

U.S. weekly jobless claims rise for a second straight week, total 1.434 million

German GDP in the 2nd quarter of 2020 down 10.1% q/q

German Preliminary CPI read for July 2020 -0.1% m/m

German employment change in June 2020: -0.1% m/m, -1.3% y/y

UK worries about second COVID-19 wave in Europe, more quarantine steps possible

China pledges second-half policy support as faces complex economic situation

KOF Swiss economic barometer for July: 85.69 vs 60.65 in June

Upcoming Potential Catalysts on the Economic Calendar for U.S. & Asia:

Japan Unemployment rate at 11:30 pm GMT

Japan Industrial Production at 11:50 pm GMT

China Services PMI at 1:00 am GMT (July 31)

Australia PPI, Private Sector Credit at 1:30 am GMT (July 31)

Japan Consumer Confidence, Housing Starts at 5:00 am GMT (July 31)

What to Watch: AUD/JPY

AUD/JPY 1-Hour Forex Chart

It’s been a sleepy market for AUD/JPY over the past few sessions, prompting price action to form a consolidation pattern on the one hour chart above. But we could be in for a breakout as risk sentiment flips negative on the session, enough to start to push AUD/JPY below the bottom of the range. 

For the bears out there, if we see negative Australia / China economic updates come out weaker-than-expected, not only culd that put pressure on the Aussie, but also add to negative global risk sentiment which would likely support the Japanese yen.

With  a stop above the consolidation range and target around the a daily ATR of around 70 pips, you’ve got a decent short-term potential return-on-risk, as well as a potential swing trade setup. That consolidation break could draw in longer-term traders and create momentum lower if risk sentiment stays negative.

For the bulls, it’ll likely take a combination of both better-than-expected Australian / Chinese data and positive global risk sentiment to draw in buyers on the pair.  If that scenario plays out, then watch out for a sustained break above the consolidation area before considering a long position.

Or if the pair is able to sustain above the 75.00 handle before the events, consider a long position at the market if we see positive data from that part of the world. 

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from Veteran Wealth https://veteranwealthmgntmarketnews.com/index.php/2020/07/30/daily-u-s-session-watchlist-aud-jpy/

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Daily London Session Watchlist: EUR/USD

With the Eurozone printing Germany’s GDP and a bunch of lower-tier releases and the U.S. publishing its Q2 GDP report, I’m setting my sights on EUR/USD today.

Where do you think the pair will go?

Before we talk about the setup, check out the major headlines that moved the markets during the Asian session:

Major Forex Pairs Price Performance from MarketMilk

Fresh Market Headlines & Economic Data:

Upcoming Potential Catalysts on the Economic Calendar:

KOF economic barometer at 7:00 am GMT

Spain’s flash CPI at 7:00 am GMT

Germany’s unemployment change at 7:55 am GMT

Germany’s preliminary GDP at 8:00 am GMT

ECB’s economic bulletin at 8:00 am GMT

Italy’s unemployment rate at 8:00 am GMT

Eurozone’s unemployment rate at 8:00 am GMT

U.S. advance quarterly GDP at 12:30 pm GMT

What to Watch: EUR/USD

EUR/USD 1-hour Forex Chart

EUR/USD is consolidating in a potential rising wedge after popping up by 500 pips since early July.

Today’s economic releases will tell us if the pattern will end in a reversal for the euro.

Germany is printing its quarterly GDP, which is expected to show a 9.0% contraction in Q2 2020.

Meanwhile, today’s U.S. GDP release can explain why the Fed is maintaining its dovish stance. Markets see the economy contracting by around 35% in Q2 2020 and, unlike in the Eurozone, Fed Chairman Powell has shared that the economy’s path forward is “extraordinarily uncertain.”

A better-than-expected German GDP release would push the euro higher especially since investors are already discounting a technical recession in favor of promising leading indicators from one of the Eurozone’s biggest economies.

A downside surprise, on the other hand, or a better-than-expected U.S. GDP report could inspire dollar-buying and drag EUR/USD below the wedge pattern and the 100 SMA on the 1-hour time frame.

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from Veteran Wealth https://veteranwealthmgntmarketnews.com/index.php/2020/07/30/daily-london-session-watchlist-eur-usd/

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Chart Art: Potential Support Plays on USD/CAD and NZD/USD

It’s comdoll trading time!

Today we’re looking at NZD/USD‘s short-term uptrend and a major support level for USD/CAD.

Let me know if you’re trading any of these setups!

NZD/USD: 1-hour

NZD/USD 1-hour Forex Chart

Trend playas unite! NZD/USD is trading around the 0.6625 levels, which lines up with July 23’s lows and is just above an ascending channel and 200 SMA support on the 1-hour time frame.

Can Kiwi bulls extend the comdoll’s gains? Take note that the channel support hasn’t been broken since late June.

Buying at the channel support would yield the best reward-to-risk ratio if NZD/USD ends up making new 2020 highs in the next trading sessions.

Of course, you can also buy at current levels if you’re not confident that the bears can drag the pair back down to the channel support before the bulls take over again.

Feel like shorting Kiwi against the dollar instead? You should at least wait for a clear break below the channel before you target previous areas of interest closer to .6580 or .6530.

USD/CAD: Daily

USD/CAD Daily Forex Chart

Touchdown! Last week I showed you guys how USD/CAD is nearing a key area of interest in the daily time frame.

Well, it’s time to put your orders in if you’re one of them dollar bulls!

USD/CAD looks ready to bounce from a consolidation at the 1.3350 area while Stochastic is showing a low key bullish divergence.

Buying at the first signs of bullish momentum is a good bet if you believe that USD/CAD will pop back up to test its 1.3650 highs or even revisit its 2020 highs above 1.4000.

Think the Greenback will continue to lose pips on the Loonie instead? A break below June’s lows can inspire a trip down to the 1.3000 major psychological level.

Watch this one closely, yo!

Forex Chart Settings:

Slow Stochastic: 14,3,3 100 SMA: Blue line 200 SMA: Red line

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from Veteran Wealth https://veteranwealthmgntmarketnews.com/index.php/2020/07/30/chart-art-potential-support-plays-on-usd-cad-and-nzd-usd/

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Daily U.S. Session Watchlist: USD/JPY

We’ve got potential action coming ahead for the Greenback with the latest FOMC monetary policy decision right around the corner. Will that bring on more bears to USD/JPY‘s current move lower?

Before moving on, ICYMI, today’s Daily London Session Watchlist looked at an opportunity forming on GBP/NZD ahead of U.K. economic updates, so be sure to check that out to see if there is still a potential play!

Intermarket Snapshot

Equity Markets Bond Yields Commodities & Crypto DAX: 12821.08 -0.11% FTSE: 6132.58 +0.05% S&P 500: 3245.59 +0.84% DJIA: 26461.04 +0.31% US 10-YR: 0.584 % +0.003 Bund 10-YR: -0.498% +0.012 UK 10-YR: 0.122% +0.012 JPN 10-YR: 0.02% -0.005 Oil: 41.33 +0.71% Gold: 1,949.20 +0.23% Bitcoin: 11,159.21 +1.99% Ethereum: 322.56 +1.53%

Fresh Market Headlines & Economic Data:

US Pending home sales continued to climb in June, rising 16.6% monthly since May, and rising 6.3% since June 2019

U.S. goods trade deficit narrows; global flow of goods improving

Trump says administration, Democrats far apart on coronavirus relief bill

German Import prices in June 2020: -5.1% on June 2019

ECB’s Stournaras Says Virus Bond-Plan Exit Depends on Inflation

UK mortgage approvals bounce back in June, Bank of England says

BoE’s Haldane sees mixed signals from regional visit

New French Europe minister – Brexit deal possible but not ‘at any price’

Upcoming Potential Catalysts on the Economic Calendar for U.S. & Asia:

FOMC Interest Rate Decision at 6:00 pm GMT

FOMC Press Conference at 6:30 pm GMT

New Zealand Building Consents at 10:45 pm GMT

Japan Retail sales at 11:50 pm GMT

Australia Building Permits, Import/Export prices at 1:30 am GMT (July 30)

What to Watch: USD/JPY

USD/JPY 1-Hour Forex Chart

On the one hour chart of USD/JPY, we can see that the Greenback has been selling off over the past week on broad USD weakness, but the momentum has slowed in today’s trade. That’s likely due to traders sitting back on the sidelines ahead of the this afternoon’s monetary policy statement from the Federal Reserve.

Expectations are that the FOMC will continue the rhetoric of doing what is necessary to support the economy but hold off on any changes to policy for now. The change to watch out for is any change in their economic outlook, which is a low probability scenario at the moment given the uncertainty that the COVID-19 has brought upon the markets. Traders will also be on the watch for any comments on yield-curve control and guidance on inflation rates and asset purchases.

If the above scenario of “no policy changes” plays out, its likely traders will stay bearish on the Greenback. But after a strong run lower over the past week, we could see a bounce on profit taking during / after the press conference.

If we do see a bounce, watch out for the 105.50 to 106.00 area for potential bearish reversal patterns. That’s likely the area swing and longer-term position traders may try to play the price trend lower. And ofcourse, a break below today’s lows (around 104.80) is also a pattern that could draw in momentum sellers if the Fed doesn’t surprise the markets at all.

For the bulls on USD/JPY, there’s really no argument out there for long position, other than profit taking. But if we see the very, very low probability scenario of the FOMC coming out bullish on the economy and/or upgrading its outlook on inflation, then the Greenback could strongly bounce on the news. A sustained break above 106.00 is the pattern to watch out for before considering a long position.

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from Veteran Wealth https://veteranwealthmgntmarketnews.com/index.php/2020/07/30/daily-u-s-session-watchlist-usd-jpy/

[machinetrading-autotrading]

Short-Term Bollinger Reversion Strategy 2.0 (July 23 – 30)

Got three new signals on this mechanical trading system for the week! Did any of these catch gains?

In this revised version of the Short-Term Bollinger Reversion Strategy, I’m waiting for RSI to cross above or below oversold or overbought levels to indicate a bit more momentum in the direction of the trade.

Make sure you review the tweaks here.

USD/CAD edged lower for the most part of the week, moving between the lower and middle Bollinger Bands.

USD/CAD 1-hour Forex Chart

A long signal popped up on an early test of the bottom band, and this managed to hit the first target and score a few pips.

The pair didn’t have enough upside momentum to take it to the full target at the opposite band, so the remaining half of the position was closed at the adjusted stop loss at the entry price.

Here’s how it turned out:

Meanwhile, CAD/CHF was also trending lower throughout the week and stayed between the bottom and middle bands as well.

CAD/CHF 1-hour Forex Chart

Price caught a valid long signal on a test of the bottom Bollinger Band, but the selloff just kept carrying on.

Fortunately, the pair didn’t dip low enough to trigger the stop loss, so it was able to stay open until a bounce to the middle band took place. Unfortunately, the trade was closed at a level lower than the entry price, resulting in a tiny loss for CAD/CHF.

Another long signal was generated towards the end of the week, and this one is still open.

With that, the Short-Term Bollinger Reversion Strategy was able to bag a measly 9.5 pips or 0.19% for the week. I know it ain’t as impressive compared to the earlier gains, but I’ll take these wins!

So far so good for this mech system this quarter still!

Have you seen how the numbers turned out for Q2 2020 yet? Oh, and don’t forget to check out Forex Ninja’s Systems Showcase in case you missed it!

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from Veteran Wealth https://veteranwealthmgntmarketnews.com/index.php/2020/07/30/short-term-bollinger-reversion-strategy-2-0-july-23-30/

[machinetrading-autotrading]

Self-Coaching for Forex Trading Newbies: Part II

The self-coaching process is very simple and at a bare minimum, only requires three things:

A forex trading journal,

Lots of self reflection and being honest about yourself, and

Writing it all down.

Being able to screenshot charts and markin’ them up would make the process more efficient.

And if you have great attention to detail and you’re good with words, then it’s possible to work your way to the competency stage of development by diligently keeping a simple written journal.

The basic self-coaching process is the same as what a coach does:

1. Observe and record everything.

Write down your efforts, plans, and any mistakes and observations about yourself and market behavior that need to be addressed.

Remember, what isn’t measured can’t be managed or improved.

2. Review your observations.

With the solid fundamental forex trading knowledge and skillset already acquired, review your observations and determine how you can make better decisions or improve the trading process.

Again, trading concepts are pretty simple and only requires common sense to improve and avoid mistakes. But you have to ask A LOT of questions. Don’t just look at a winning trade and think, “I should have had a bigger gain.”

Ask questions so you can improve. Was my target appropriate? Should I have added to my position in this environment? Was my entry the best in this particular situation?

If you really need help, show your journal to others for feedback.

3. Create guidelines.

Create guidelines so you can avoid bad trading habits. Also, remember to practice good trading habits for future trading sessions.

With time and practice, this can be internalized, but you should make it a habit to review it regularly.

Write down why you got into trading and/or your life goals. Review every day to motivate you. You will need to do this because there will be days (very many in the beginning) where trading will not fun (read: profitable).

4. Rinse, repeat and stay focused.

That’s it, forex folks. Simple, but not easy as this will obviously be a lot of work. A lot of the questions you ask yourself to improve will take time, and maybe some experimentation before you find the right answer that fits you.

And don’t think this process only applies to discretionary traders, chartists, or mechanical traders. Robots need to be watch and improved upon as well, and as with any other tool, applied to the situation it was made for.

Keep in mind that there is no guarantee of success in anything we do, even when years of hard work is applied. This is especially true in the world of trading and investing as it will always be a game of probabilities.

But the one thing that I can say is that without a process of deliberate practice and reflection like self-coaching, your probability of success in this business is significantly reduced; maybe even zero.

So, don’t just look at charts, aimlessly buy or sell, call it day, and then grab a drink with friends to celebrate (or sulk) over your trading session…grab your journal and get to work!

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from Veteran Wealth https://veteranwealthmgntmarketnews.com/index.php/2020/07/29/self-coaching-for-forex-trading-newbies-part-ii/

[machinetrading-autotrading]

Trade Idea: EUR/JPY Uptrend Play

EUR/JPY bulls have had a solid run over the past few months, but the rally has lost a bit of steam this week. Is this a pause before another leg higher?

EUR/JPY Uptrend Play

EUR/JPY 1-Hour Forex Chart

This week I’m checking out the solid uptrend in EUR/JPY, where the bulls have benefited from recent positive economic sentiment updates from Europe (Eurozone businesses report strongest growth for two years in July) and the massive stimulus deal passed by the European Union last week.

And without major catalysts ahead from both Japan and Europe for the next couple of weeks, I think traders in the pair will continue to ride those themes higher, barring any major shifts in global risk sentiment, pandemic or geopolitical news.

I look to play the uptrend in EUR/JPY, but I will do so if the pair pulls back to the strong area of interest around just above the 123.00 major psychological level.

For my stop, I’m using the daily ATR as my guide, placing my exit point below the next major psychological level (122.00) that held as support in mid-July. And my max target will be just under three times my risk and the 2019 swing highs.  Here’s what I’m doing:

Long half position on EUR/JPY at 123.00, max stop at 121.80, max target at 126.50

I’m only risking 0.50% of my account and I’ve got a solid short-term potential return-on-risk of over 2.91:1 to start.  If triggered, I plan on adding to this trade/rolling up my stops if the pair rallies higher to maximize my potential gains/reduce risk, if the market themes down the road still dictate a bullish case.

Be sure to manage your risk and avoid overexposure.

What do you guys think? Are you watching EUR/JPY for a potential long position as well, or do you see a drop coming soon? Let me know in the comments section below!

This content is strictly for informational purposes only and does not constitute as investment advice. Trading any financial market involves risk. Please read our Risk Disclosure to make sure you understand the risks involved.

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from Veteran Wealth https://veteranwealthmgntmarketnews.com/index.php/2020/07/29/trade-idea-eur-jpy-uptrend-play/

[machinetrading-autotrading]

GBP Weekly Forecast – Slow Week for Sterling?

There’s not much in the way of top-tier releases from the U.K. this week.

Will this mean a slow one for GBP pairs or are there other catalysts to look out for?

Low-tier U.K. data

BRC Shop Price Index y/y (July 29, 12:01 am GMT) to show rebound from earlier 1.6% drop

Mortgage approvals (July 29, 9:30 am GMT) to climb from 9K to 35K

Net lending to individuals (July 29, 9:30 am GMT) to show smaller deficit of 0.4 billion GBP from earlier 3.4 billion GBP

GfK consumer confidence index (July 31, 12:01 am GMT) to hold steady at -27

Brexit updates

Last week’s price rallies were capped by Brexit-related uncertainty as there have been talks of dropping the trade deal altogether

This theme could carry on for the upcoming week as negotiations have once again hit a wall

Technical snapshot

GBP Pairs Trend Strength from MarketMilk

Only GBP/CHF is giving off strong bearish vibes while GBP/JPY’s bullish trend is weakening

On the other hand, Stochastic is putting GBP/USD, GBP/JPY, and EUR/GBP in bearish territory

GBP Pairs Stochastic from MarketMilk

Missed last week’s price action? Read GBP’s price recap for July 20-24! 

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from Veteran Wealth https://veteranwealthmgntmarketnews.com/index.php/2020/07/29/gbp-weekly-forecast-slow-week-for-sterling/

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Chart Art: Short and Long-Term Setups on EUR/JPY and EUR/AUD

Welcome to mid-week trading, yo!

Whether you’re a day trader or you’re more into longer-term trades, you’ll definitely want to see what I got on EUR/JPY and EUR/AUD.

Check it!

EUR/JPY: 1-hour

EUR/JPY 1-hour Forex Chart

EUR/JPY is consolidating in what looks like a descending triangle after rising by a cool 400 pips from late June to this week.

Are we looking at a reversal in the making? Or are euro bulls just taking a breather?

While descending triangles tend to break to the downside, they still represent indecision which could lead to breakout in EITHER direction.

A break below the 123.00 triangle support could drag the euro all the way to the 122.00 previous resistance zone.

An upside break, on the other hand, could push EUR/JPY all the way to 124.25 or 125.25 areas of interest.

What do you think? Which way will EUR/JPY go?

EUR/AUD: Daily

EUR/AUD Daily Forex Chart

I spy with my eye a double bottom play in the making!

As you can see, EUR/AUD has found support at the 1.6100 psychological handle twice in the last couple of weeks.

Will the pair break above the 1.6400 “neckline?” Or will the pair range until it finds new direction?

Shorting at current levels would yield the best reward-to-risk ratio if you believe that the euro would go back to the 1.6100 support.

If you’re on the bull camp, however, and you think that EUR/AUD will soon revisit its 2019 levels, then you can also wait for a break above the 1.6400 mark and then scale up your positions until the bullish swing runs out of steam.

Good luck and good trading this one!

Forex Chart Settings:

Slow Stochastic: 14,3,3 100 SMA: Blue line 200 SMA: Red line

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from Veteran Wealth https://veteranwealthmgntmarketnews.com/index.php/2020/07/29/chart-art-short-and-long-term-setups-on-eur-jpy-and-eur-aud/

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Daily London Session Watchlist: GBP/NZD

A few low-tier reports are due from the U.K. economy in the London session, so I’m hoping for some pullback action on this sterling pair.

Risk aversion could stay in play over the next few hours as tighter border restrictions and geopolitical tensions made it back to the headlines.

Major Forex Pairs Price Performance from MarketMilk

Before we check out the setup, you might want to read the top news during today’s Asian session trading.

Fresh Market Headlines & Economic Data:

Upcoming Potential Catalysts on the Economic Calendar:

German import prices at 6:00 am GMT

Swiss Credit Suisse economic expectations index at 8:00 am GMT

U.K. mortgage approvals and net lending to individuals data at 8:30 am GMT

What to Watch: GBP/NZD

GBP/NZD 1-hour Forex Chart

Higher-yielding currencies are under some downside pressure lately as the market focus is returning to the surge in coronavirus cases.

Sterling, however, managed to draw some support from upbeat medium-tier data. Will the next batch of U.K. figures keep it afloat? Or is a pullback due first?

Stochastic is heading south from the overbought zone, so price could follow suit as sellers take the upper hand. Using the Fib retracement tool on the latest rally shows that the 38.2-50% levels span an area of interest or former resistance that could hold as support.

Also, the 100 SMA is above the 200 SMA to confirm that bullish momentum could pick up. After all, GBP/NZD recently broke above the neckline of a double bottom pattern, so a rally of the same height as the reversal pattern (300 pips) could follow.

This means that the pair could recover to the swing high and beyond, especially if risk-off flows stay in play for the London session. Just make sure you look at the average GBP/NZD volatility when setting your entries and exits!

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from Veteran Wealth https://veteranwealthmgntmarketnews.com/index.php/2020/07/29/daily-london-session-watchlist-gbp-nzd-2/

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Trade Closed: EUR/AUD Fib Short Play

Took a hit on my EUR/AUD idea last week as the market swiftly went risk-off and the euro found support on improving sentiment data. Here’s a quick review.

EUR/AUD Fib Short Play

EUR/AUD 1-Hour Forex Chart

Last week, I decided to short EUR/AUD after the pair broke below a rising trendline to play the broad risk-on environment and the massive EU stimulus that just passed.

I decided to do so on a pullback as the pair had already made a strong move lower, raising the odds of a pullback higher.

Well, I got the pullback I was looking for, but that rally was on changing conditions, most notably the broad shift in risk sentiment last Thursday as traders started to worry about economic conditions given the rise in COVID-19 cases and the persistently weak U.S. jobs data.

We also saw geopolitical issues as tensions rose between the U.S. and China, pushing traders away from risk assets into safe havens and lower-yielding currencies. And there may have been some selling pressure on the Aussie as COVID-19 cases were rising in Australia.

This was the likely driver behind EUR/AUD’s rally higher, pushing the pair quickly beyond the Fibonacci retracement area, back above the rising trendline and hitting my max stop at 1.6325 to close out my full position for a loss: Total: -48 pips avg. / -1.00% loss on 1.00% risk taken

Looking back, I definitely didn’t expect the market to turn like that, even with another round of bad U.S. unemployment claims data. The market had largely ignored the underlying economic conditions to focus on the “reopening trade,” so it was really a surprise when the markets turned negative last week.

Other than that, I think it was a good setup trade that just didn’t work out this time. Looking forward, I think I may flip bullish on EUR/AUD if fears and uncertainty continue to grow, and if traders continue to price in better time ahead for Europe now that the ball is rolling on the EU recovery fund.

Stay tuned for that and as always, remember to never risk more than 1% of a trading account on any single trade. Adjust position sizes accordingly. Create your own ideas and don’t simply follow what I do.

This content is strictly for informational purposes only and does not constitute as investment advice. Trading any financial market involves risk. Please read our Risk Disclosure to make sure you understand the risks involved.

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from Veteran Wealth https://veteranwealthmgntmarketnews.com/index.php/2020/07/29/trade-closed-eur-aud-fib-short-play/

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Bitcoin and Altcoins Price Analysis: Long-Term Bullish Signals

Crypto bulls are back in town yo! Bitcoin and its buddies look prime for more gains as longer-term bullish patterns are playin’ out!

Cryptocurrencies scored impressive gains in the previous week, led by ETH with a whopping 29.14% price increase.

XRP is behind the pack but is still holding on to a stellar 15.72% gain next to BTC, which is up 17.04%.

Check out this ranking of bitcoin and its buddies for the past seven days:

Altcoins Price Performance from MarketMilk

BTC/USD Daily Chart

Bitcoin gained so much upside momentum since its triangle breakout we caught last week, attempting another potential bullish feat this time.

An inverted head and shoulders pattern can be seen on its daily time frame, and it looks like price has already climbed above the neckline resistance.

In that case, the rallies are just getting started yo! The 100 SMA crossed above the 200 SMA to confirm that bullish momentum is picking up, but Stochastic is in the overbought region to suggest that a quick pullback might be needed.

ETH/USD Daily Chart

Ethereum is also in the process of confirming a potential long-term reversal as price is testing the neckline of a sketchy triple bottom on its daily chart.

Now I don’t see this chart pattern very often, so I’m thinking that this rare formation could be a pretty potent signal that a rally is underway.

Heck, ETH could be in for a climb that’s at least the same height as the reversal formation, which spans around $200!

The 100 SMA is safely above the 200 SMA to indicate that more gains are in the works, but Stochastic is reflecting exhaustion among buyers. If sellers take advantage of this, another dip to the bottoms could follow.

LTC/USD Daily Chart

Litecoin has been on a tear but is hitting a roadblock at the top of its ascending channel on the daily time frame. A pullback to the nearby support levels might be needed to draw more bullish energy.

Applying the handy-dandy Fib tool on the latest swing low and high shows that the 61.8% level lines up with the channel bottom and a former resistance level.

If buyers are eager to return, a shallow pullback could be enough to spur a bounce. The 38.2% level is close to the mid-channel area of interest while the 50% Fib lines up with the 200 SMA dynamic inflection point that could add to its strength as support.

XRP/USD 1-hour Chart

XRP looks prime for a short-term bullish pullback opportunity as price is moving above a rising trend line on its 1-hour chart.

Stochastic is indicating overbought conditions, so buyers could take a break and allow sellers to take the upper hand. However, the 100 SMA is above the 200 SMA to indicate that the rally is more likely to resume than to reverse.

Applying the Fib retracement tool on the latest rally reveals that the 61.8% level lines up with the trend line and a short-term area of interest where buyers might be waiting.

Just be warned, there is a considerable amount of risk in trading cryptocurrencies due to their inherent volatility and sensitivity to headlines. Be careful out there!

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from Veteran Wealth https://veteranwealthmgntmarketnews.com/index.php/2020/07/29/bitcoin-and-altcoins-price-analysis-long-term-bullish-signals/

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Trade Idea: EUR/USD Long on a Pullback?

EUR/USD has been on a tear higher over the past week without a speed bump along the way. Will the bull stay in control or is there a reversal coming?

EUR/USD Long on a Pullback?

EUR/USD 4-Hour Forex Chart

This week, I’m taking a look at the trend higher in EUR/USD, which has been in play since the pair bottomed out around 1.0650 at the height of pandemic fears. And it looks like the rally has recently picked up steam, likely correlating with the improving sentiment on Europe and on the European Union agreed on a mammoth stimulus package worth 750 billion euros last week.

We’re also likely seeing negative sentiment on the U.S. dollar being priced in, likely driven by numerous factors including rising negative sentiment on the U.S.’ COVID-19 situation (U.S. records 1,000 deaths in one day from COVID-19, California passes 400,000 cases), disappointing economic data (another week of above 1M U.S. weekly jobless claims), and uncertainty on the next U.S. government stimulus package.

Looking forward, we just got the latest proposals for the next U.S. stimulus bills so there’s less uncertainty there, and it’s not likely we’ll see the Fed introduce more stimulus measures during this week’s FOMC statement. No major items on the economic calendar from Europe over the next couple of weeks, so it’s possible price action will be influenced more by COVID-19 headlines and geopolitics rather then economic updates. So, unless we see surprising news in a bigly way on any of those fronts, I think EUR/USD will likely move sideways to up for now.

With that said, I’m looking to go long EUR/USD, but I’m going with a conservative entry strategy ahead of the FOMC statement (buy area around the rising ‘lows’ pattern / trendline in the chart above). It’s possible they could throw out some cautiously optimistic rhetoric out there given some signs of the U.S. economy bouncing back (e.g., The Chicago Fed National Activity Index was +4.11 in June, Manufacturing Activity in Central U.S. Swings to Expansion in June, U.S. retail sales increased a better-than-expected 7.5% in June), which could lead to a pullback in the EUR/USD rally.

Since this is a swing trade, I’ll use the weekly ATR as my stop guide, and my max profit target will be two times my stop for a solid starting potential R:R of 2:1. Here’s what I am doing:

Long half position EUR/USD at 1.1575, max stop at 1.1375 with 1.00% risk, initial target at 1.1975

Again, I’ll be risking only 1.00% of my account to start with an initial 2:1 potential R:R. If triggered and going my way, I may add to this position depending on what we see from the FOMC tomorrow and the U.S. GDP data on Thursday. If my orders aren’t triggered by the end of Friday, I will cancel my orders ahead of the weekend and re-assess this trade idea.

As always, remember to never risk more than 1% of a trading account on any single trade. Adjust position sizes accordingly. Create your own ideas and don’t simply follow what I do.

This content is strictly for informational purposes only and does not constitute as investment advice. Trading any financial market involves risk. Please read our Risk Disclosure to make sure you understand the risks involved.

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The post Trade Idea: EUR/USD Long on a Pullback? appeared first on Veteran Wealth.

from Veteran Wealth https://veteranwealthmgntmarketnews.com/index.php/2020/07/28/trade-idea-eur-usd-long-on-a-pullback/