Weekly Trade Idea’s

November 4th – 8th

 

GBPUSD – Despite the fact that we expected a reversal on sterling/dollar exchange rate from last week Monday – key participants have expressed the opposite. In the midst of this, price has tapped a very critical barrier some PIPs shy from $1.3000. A smooth bearish entry was actually taken on the re-visitation of $1.2970.

Going forward, sterling depreciation is expected  as we progress into this new week. Given how critical the $1.2790 area has proven to be, as historical events has clearly showed us – a sharper rejection is on the cards for price to re-visit the $1.28081 zone. With the being said, there is a 120+ PIP room to the downside on this exchange rate.

 

 

 

GBPJPY – On the contrary, sterling/yen has expressed market indecision – which we believe is mainly tied down to JPY.

Price has ranged for a number of days around the 141.239 – 139.090 zone. The underlying mechanism behind market indecision is off course market participants accumulating more orders – we believe they will express a bearish view on sterling also – with price breaking below 139.090 and reaching levels of 135.725. There is a 300+ PIP move expected to the downside on this instrument – given the number of days of consolidation – the move will be VERY volatile.

 

 

 

28th – November 1st

GBPJPY –

Interesting piece of price action on this instrument as price reaches highs of 141.187. There has been a significant amount of build up of orders as price consolidates around the 139.191 and 141.187 zones. A further climb above the previous highs was expected, however, assessing the price action behaviour expressed the contrary.

As you all might expect, there is a lot of uncertainty with the Brexit unfolding…however, a break below 139.191 is expected as we progress into the week. This zone is in fact the only level which is holding as a major support zone for this exchange rate before price declining and reaching new lows at 138.353 and potentially even 137.315.

 

 

Smooth USD depreciation occurred on this instrument last week as expected to reach new lows at 1.30551.

A decline towards 1.30150 was expected – however, price has only decline 80 PIPs from our last USDCAD analysis last week. A further decline is still expected on this instrument, to tap into the 1.30150 level, subsequently – a sharp reversal is expected from this zone (given the importance of this support barrier)

Given the distance from current market prices and 1.30150 is only 40 PIPs, a more speculative order will be buying from the lows (1.30150) as oppose to shorting towards the lows.

 

 

 

 

21st October – 25th

GBPUSD – Significant sterling appreciation within the last two weeks – as expected. Technically, price has triggered in a low at $1.2200 – which is significant higher low from the previous low triggered in at $1.2000. Personally, we did not see the cable exchange rate going any lower than $1.2000 (for now) given the Brexit uncertainty AND off-course the price in which the exchange rate was previously trading at as well ($1.19565). This is also the lowest the sterling/dollar exchange rate has traded at – let’s also remember that anything lower than this level we will actually breach below critical 1987 lows .- which will obviously have catastrophic impacts on those who pay for goods and services in GBP and even those who provide goods and service in GBP.

Now going forward, there will be a significant amount of volatility with a potential finalised Brexit emerging – we can the price of this exchange rate to pull-back and re-visit $1.2739 before a FURTHER climb to successfully break above the psychological $1.300 barrier.

 

USDCAD – Seems as though market participants have been favouring Canadian dollars as oppose to USD for a number of days – the rejection from 1.33374 was expected given the critical supply level that resides here – it has historically been proven to be a VERY liquid area. Now we say that the USD weakness has been dominant on this exchange rate, due to the closure below the 1.31411 area.

Price is surely headed lower – however, as we progress through the week a re-visitation of this area as a new supply zone is expected before a further decline on this instrument. Downside expectations on this exchange rate will be 1.30261.

 

 

 

 

 

7th – 11th October

GBPUSD – interesting past few trading days on the sterling/dollar exchange rate as uncertainty is expressed amongst market participants as price consolidates around the $1.2350 – $1.22842 zone.  In the midst of all of the uncertain price action movements – price has triggered in  evident higher lows (which is easily viewable from the daily perspective). We can expect a upward climb on this instrument to re-visit the $1.24144 supply barrier for this exchange rate.

The price action movements within the last few trading days has been interesting – despite the lack of volatility last week – we have still managed to grasp critical information from a technical perspective. Furthermore, sterling appreciation is on the cards for Monday/Tuesday trading days.

 

 

 

GBPJPY – On this exchange rate we have actually witnessed Yen demand throughout last weeks trading. Price has smoothly tapped into the demand barrier of 131.819. Technically, the false break is added confluence for a significant rocket to the upside. The 131.819 one is absolutely critical zone – and market participants have expressed how keen they are on keeping the exchange rate above this level.

Sterling appreciation is expected on this exchange rate  – with the 132.534 level being the next stop on this exchange rate throughout Monday/Tuesday’s trading sessions.