EUR/USD – Market Having Trouble Dropping Lower
EUR/USD has declined a little since the open last night but seems to be having difficulty falling to new lows.
A small supply zone formed when the market dropped at the open last night but it would have been tough to get an entry due to their not being any signals to go short on the lower time-frames. At the moment I think the price has a higher chance of moving lower than it does higher, over the USD seems to be quite strong at the moment with USD/JPY advancing and GBP/USD declining, so its likely EUR/USD will also suffer some additional down-moment.
USD/JPY – Retracement Underway
Last week I said how it was possible the retracement was not over, and that we may see more upside if the banks decide to take profits off their sell positions which they have done today.
Although this current move higher has been caused by banks taking profits off sell positions placed back at the beginning of the downtrend, there will be bank traders who are making smaller amounts of profit from trading counter trend moves. This is why you can see profit taking on the retracement even though the retracement itself has formed because of profit taking.
Son far there isn’t really much in the way of technical levels we can use to look for long trades, there was a bullish pin bar setup present this morning but since then there have not been any other entries long. For now I think its best if we wait until the current up-move gives us signs that it wants to change direction before trying to go short, if we try to predict when the move is going to end, there’s a high chance we’ll lose money because we’ll be basing our decisions off old technical levels which may not have much use anymore.
AUD/USD – Continued Decline, Down-Move Might Becoming Over Extended
The price has continued to fall on AUD/USD after last weeks NFP release, looking at how far the market has dropped I think it may be possible that we’ll see a bigger retracement take place towards the end of week.
The new low tells us the momentum is currently to the downside so I think it’s still best to look for opportunities to go short even though a large retracement may be building up behind the scenes. The breakout zone could give us the entry short we need but there’s a chance the current bullish candles are making the breakout traders close their trades so its imperative we look for a bearish engulf if the price moves back into the breakout zone.