The Forex Market Wrap is here!
Watch the video to learn what key levels have been hit this week!
The USD index was bearish for us this week as the weekly time frame looked to be in a retracement phase on the weekly uptrend. In this retracement phase we highlighted the lower highs and lows forming on the 4hr time frame which offered us short opportunities this week. The Federal Reserve chairman Powell is speaking and talking of continuing to taper through to Q1.
Technically we still see some short term downside for the USD unless the 4hr time frame can change trend. If this does change trend then we need to switch our bias back to long in line with the weekly time frame.
The inverse to the USD Index is the EURUSD, the weekly trend on this market highlights the retracement phase we are in currently with the previous swing lows at 1.1700 looking good for targets. There are multiple confluences at this zone which suggests it could be the area that the market wants to head towards before continuing the downward trend. If the market continues to form higher highs and higher lows we could look for short term swing trading opportunities to the major resistance zone.
This week we identified a potential short term long opportunity on this market as the price looked to be following a minor uptrend. Seasonally Silver rallies through the last quarter which is why we looked for a trend trading opportunity. We looked for the market to retest the previous 4hr highs and form a long opportunity on the 1hr time frame with the price closing above the 50EMA. When this formed we can see the price rallied higher hitting the targets of the previous swing highs.
The USDJPY chart was on our watchlist for a reversal this week as the JPY was highlighted as the weakest currency on the strength meter. When a currency shows extreme weakness we can often see it flip and strengthen in the short term. Looking at the price action we wanted the USDJPY to form normal trend conditions with higher highs and higher lows. The price has now formed a retracement move we were looking for, maybe this can lead to another long opportunity or we could see the chart make a longer term move.
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