Weekly Commentary: 28th Apr 2013

Previous weekly commentary: Commentary on 21st April 2013

Hi Readers,

The USD index continues its indecision. As mentioned last week, I wanted a break above the $83.50 resistance level but I did not get it. At this point in time, I do not have clear indication of where price is heading to. With that, I shall stay away until I get a clearer view.

The following is my watch list for the week:

28 Apr - GBPUSD Daily

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  • GBPUSD – Buyers and sellers were in an equally weighted war which caused the currency pair to enter a range market (see article). I was expecting a short from a long term down trend however, on Thursday, price finally broke above a major resistance, which invalidated my short bias mentioned last week (see article).

I will be looking to see what price has to offer in the coming week. If it reaches the next resistance level around 1.57, I would like to find a short entry and watch to see if that is a retracement or a reversal. If not, I will likely sit out until further clarification.

28 Apr - AUDJPY Daily

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  • AUDJPY – This pair is currently sitting on a long term resistance (now support) level around the 100.1 level. With the weakness from USDJPY, there may be a potential for reversal. For that to happen, I would like to see a convincing price break below the support level as well as the support Trend line. I would find a short entry when price pulls back to re-test enter the trend line or new resistance level (green path).

That would be an ideal situation. Until then, I shall sit aside and watch.

28 Apr - AUDNZD Daily

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  • AUDNZD – I was expecting price head south on the 17th March (see article), and gosh… price just went and never looked back. These are days which reminds me that (1) trade what you see and not what you think and (2) keep things simple – trading is not difficult  (of course, you don’t get days like that all the time), it is usually the trader that makes it harder than it should be.

Well, that was that past. Let’s move forward now and not let the possibility of recency bias affect our analysis. Right now, after a long bear run, I am looking for price to retrace or to reverse north. Price has continued to respect my channel and it is also sitting at a long term support level at the moment. For those who use oscillators, you will also likely see a bullish divergence.

Anyway, remember to trade according to your rules and remember that past performance is not an indicator of future results (or something along those lines).

  • EURNZD – As mentioned last week, I got a nice short entry from the false break high test bar on the 23rd April. My stop is now at breakeven – which means I am now riding on a risk free trade. I will to see price break below 1.509 for confirmation of a short continuation.

Note: Non Farm Payroll will be held this coming Friday. Hope to get more clarity with the USD and any related currencies.

 

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