Feb 20 – Feb 25
AUDUSD – Price remained in the flag
EURCHF – Price collapsed taking out support and recovered but no trade
EURJPY – Price completed the pullback but no entry long
GBPNZD – Triangle gave us potential in both directions. Break downside, paused and continuation leading to 370 pips potential
NZDUSD – Still in the flag better seen on the weekly
USDJPY – Break of inside bar to the upside for 50 pips potential
To say that markets are not in the best shape to trade would be an understatement. When you see momentum in both directions followed by consolidations, that is not conducive to good trading. This past week was 116 pips plus entries into crypto to the upside. Crypto was short lived.
With news in Canada that people are having their crypto accounts frozen, the promise of being away from the reach of the government, is not looking good. There are some in the crypto space telling holders to get their wallets out of exchanges that are regulated.
Feb 13 – Feb 18
AUDUSD – Stayed inside the triangle pattern
BTCUSD – Price supported in our zone and bounced for $1900
ETHUSD – Price held our zone and bounced for $200
EURAUD – Price broke to the downside
GBPAUD – Bear flag broke for 116 pips downside
NZDUSD – Price broke the trend line to the downside but did not trigger sell stop entry
NZDUSD – Price stayed in the range
This past week saw a potential of 460 pips plus some gains in Bitcoin and Ethereum. Crypto is still having some problems getting much push to the upside and hopefully we can see a run to highs in the near future.
Quite a few currencies ended the week with momentum moves which makes it a challenge for a trade. When faced with momentum moves, you’d want to see some type of consolidation or pullback. While you can trade the breaks of momentum candlesticks, we run the risk of taking trades just prior to a reversal.
All markets are in a weird state and being surprised by momentum pushes in either direction shouldn’t happen. Hoping to see us getting back to nice strong trends, in either direction.
Feb 6 – Feb 11
AUDJPY – Bear flag was invalidated by upward momentum. That upward momentum then resolved into a failure test of highs that set up a short for 70 pips
BTCUSD – Price drove up $3000 from the brief consolidation. Currently in a pullback.
ETHUSD – $200 jump from the consolidation. Same as BTC with the pullback
EURAUD – Inside bar off this test and a 200 pip drop
EURCHF – Price ranged and broke to the downside
EURJPY – Failure test gave an entry to the downside for 147. Price did break resistance and failed on the same candlestick
EURUSD – Failure test for 45 pips downside
GBPAUD – Price broke down
GBPNZD – Downside break
GBPUSD – No setup
NZDUSD – Both directions played but I didn’t have an entry
USDCAD – Trading range.
390 pips last week in FX and crypto breaking bear flags to the upside. This week, we have some good setups that are giving potential in both directions. A little heavy with EURO crosses so ensure that if you take multiple EURO setups, your risk per trade reflect that. If EURO turns in one trade, it could very well turn in all trades.
Our 2 cryptos are in a position that with further upside over resistance, we could finally see an end to the bearish feel in those. They are setting up well….but like FX, they are driven by different factors.
Jan 30 – Feb 4
AUDUSD – Price held at support and break of candlestick high led to 120 pips to the upside
BTCUSD – Price broke to the upside from the bear flag with momentum. This is a failed pattern.
ETHUSD – Same a Bitcoin. Break to the upside
EURCHF – Break of range high for 160 pips
GBPJPY – Price grinded higher until a momentum candle to the upside printed. Momentum to the upside of a bear flag invalidates the setup
USDCHF – While looking for another leg up, we had a failure test of highs. A short of the lows of the failure candle leads to 110 pips downside.
Another week gone where markets were in a tumble. Interesting to note that crypto appears to be closely tied to the overall stock market environment than people thought it would be. In fact, there was talk about crypto being a hedge against downside in the indexes. When you can be up or down 40-60% week over week, using as a hedge doesn’t appear to be the best approach.
FX offered potential of 290 pips and both BTC and ETH reacted to the upside off of our noted zone.
Momentum coming into the downside with crypto last week + the consolidation can be read two ways: Strong downside interest OR capitulation into lows for a rebound. How to play those moves? Momentum coming into the upside. Without that, shorts are the better play.