Weekly Forex Notes April 28, 2014
The past week in Forex was relatively quiet. Because of this, there were essentially short-term trading opportunities at the moment as the markets are trying to figure out what it is that they are trying to do. The markets have been very choppy in general, and this is most shown in the EUR/USD pair, the most widely traded financial instrument in the world. After all, if that market can't really pick up momentum in either direction, it is relatively easy to imagine that the markets in general might be difficult.
This isn't to say that the markets aren't offering any opportunities, just that we will have to look in less traded markets. After all, the less liquid markets can offer great trading chances for the retail trader, and they should not be ignored. On that note, the GBP/AUD pair is one that we are interested in. The pair has recent broken out above the 1.8000 level. This level was resistive, but it should now offer support going forward. The Friday candle was a hammer as well, and we think this pair will more than likely head towards the larger resistance level at the 1.8500 handle.
British Pound – Aussie Dollar daily
The markets are essentially trying to decide big questions at the moment, and we are going to the warmer months as well in Europe and North America. The larger players will be thinking about vacation soon, but there is a good chance that we will have to “balance the markets” before they take off in a few months. This being the case, we feel that there will be moves soon. However, the larger ones might be in these less traded markets, as it takes less to move them.
Another market that could provide a trading opportunity is the EUR/CAD pair. The Canadian dollar has been beat up in general lately, and the Euro has been one of the chief culprits in this action. The overall trend is most certainly to the upside, and the weekly candle is a hammer. The shape of the candle suggests that we are going to continue to see buyers every time this pair dips. Because of this, we think that this market will continue higher in the mean time.
EUR/CAD Weekly Chart
The coming week:
Monday – China, HSBC Final Manufacturing PMI, G7 meetings all day
Tuesday – Australia, Interest Rate Statement. USA, Trade Balance. Canada, Trade Balance.
Wednesday – Australia, Employment numbers.
Thursday – UK, Bank Rate. EU – Interest Rate.
Friday – Canada, employment numbers
