Weekly Commentary: 12th May 2013

Previous weekly commentary: Commentary on 5th May 2013

Hi Readers,

The USD index is now officially in a range market. Of course, price could continue north and start trending again. In line with my commentary last week, there is no convincing price action yet and, hence, I now hold a neutral view. The start of the week will give me a better indication of market sentiment.

The following is my watch list for the week:

12 May - GBPUSD Daily

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  • GBPUSD – If you’ve read my market commentaries in the past, you would realise that I love using price channels. Right now, Cable is showing me another healthy channel with a good potential for a long set up. For those who use the Fibonacci tool, price is currently testing the 61.8% retracement level. Let’s see if we can find a nice entry set up at the start of the week.

12 May - NZDUSD Daily

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  • NZDUSD – Another decent price channel shouting at me. Please be aware that there is no guarantee that this will turn out in our favour but price has respected the channel in the past (blue circles) and the probability of it respecting it again looks high.  In fact, price did move within the channel, in line with my commentary on the 14th April (see article). Just to note, I am well aware that there is a near term resistance level around 0.847. Hence, while my bias is long and I will trade with caution. 

12 May - GBPAUD Daily

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  • GBPAUD – It has been a long time since I touched this currency pair. As you can imagine, I have very strict rules about trading and I seem to get less opportunities on cross pairs. Anyway, I’m not here to bore you with my rules.

This pair is currently testing a long term downward price channel. It is also testing a soft resistance level. However, the resistance level is not as clear as I like it to be and I would personally put less weight on it. Nonetheless, my bias is short on this pair and I will be long for some short setups from here.

Anyway, happy trading week ahead!!

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