FOREX MARKET WRAP: 9th October
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Hi, and welcome to this Blueberry Markets video update with me, John Kibbler, head currency analyst.
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In this video, we’re gonna go for the Forex Market Wrap. It’s not gonna be the greatest Forex Market Wrap. The Dollar weakness has just really smashed through. I wasn’t expecting this at all. I’m expecting that seasonal play to start coming through. We were going to see a little bit of that Dollar stream continuance.
Now, the strength and weakness table, if I bring that in. We looked at it at the start of the week, the Dollar was at plus fives. Okay, now that does usually tip into the reversal side of things, but when we looked at those daily charts the trends were changing, and it looked like that the trend was still pretty much in the US Dollar favor.
Now, unfortunately, that hasn’t followed through. So, it looks like there’s going to be a little bit of changing of the guard in terms of Dollar strength. He’s going to be looking a little bit weaker going into the end of this week. Some things that did play out in terms of reversals.
So, Aussie was suggesting that it was going to reverse although very weak. So, again you kind of look at that AUD/USD chart and think: the trend could either continue or reverse. And it was at a point where it looked to us that it would continue that trend. Unfortunately, it doesn’t look like that’s going to play out either. We’ve seen a reversal in that currency strength and weakness.
The Yen also reversed, and this is why we looked at it. Looking at the dow long, because the Dow was one of those where it was at a point where to me it looked like that risk on play was going to come through. So, one way that we looked to sort of hedge that was by looking at that dow long in there.
The stock markets rallying has caused these risk currencies just to gain a little bit of strength. We were expecting another sort of down week to the stock markets, or at least to another buying week involved with the Dollar. We were expecting sort of these follow-throughs to come through, and then maybe a continuation like on Euro.
We were talking about how important that four-hour was to change the trend, and it looked like we were getting this lower high in here. And the market was a key to breaking that low, and we had this candlestick here where it looked like the price was starting to head towards that area in here, but then it formed a nice sort of rejection of that.
Unfortunately for us and prices continue to break out. So, it’s gonna be interesting to see if it will kind of or when the US session comes in, whether that momentum will turn around for us, and we’ll see that Dollar stream coming in.
At the moment, it’s not looking likely. It’s looking like the Dollar’s weakness is continuing. Still, in the sort of USD/CHF move over here. It’s just pulled back, it looks to me like again focusing on that sort of four-hour time frame.
We were looking for the break and close above this high, so important looking at this four-hour time frame to see what’s happening. The market has just continued to break down. So until anything changes, the bias here is just kind of still to the downside. There’s no real effort here to see that the market’s pushing up.
We’re gonna wait for that US session to drop in and see how it performs at the end of the week. We can better then judge it and look at it on the outlook, see if we can take any different sort of positions or whether we are positioned still correctly. If not, then we’re going to have to make some adjustments. But you know what to do anything differently , not really. We had a nice break on AUD/USD. It just hasn’t followed through with the momentum we expected.
Euro arguably, we could have waited for a little bit more of a bright down here, but we were looking at that daily candlestick momentum there, and that rejection. So, that one it could still come through. The US session hasn’t come into play yet. So it’d be interesting to see how those perform.
The EUR/NZD was expecting the pullbacks regardless. So we’re in these at the minute, waiting for any extensions to the upside through there. That four-hour trend is still looking pretty good on both of these. Let’s see how these play out, but essentially, looking at the Forex Market Wrap and just seeing what’s happening.
The Dollar weakness is very much prominent at the moment, which is unfortunate. Just bringing it back to this strength and weakness chart. I was expecting that to continue for at least another week or so, but obviously, it’s been a heavy news week as well. There’s been lots of changing going on and lots of heavy headlines, which have disrupted the natural sort of flow to the markets.
So, it’d be interesting to see how next week starts, or how the end of the day plays out. We’ve pretty much rallied across the majors, so the Dollar is getting weaker, so be interesting to see what happens when the US does come through. Will the US session drive that Dollar strength back higher?
If it does, then it looks like you know, and the way it’ll finish will be something that we’ll have to analyze going into sort of the Forex Market Outlook. Nonetheless, I hope you’ve had a great trading week, and we will catch you very soon.
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