The euro showed strong and sharp growth after on increased volume and have broken out the previous level of resistance 1.0681, that enables us to deliberate a scenario of opening long positions. Also we should highlight the new level of support 1.0686 – 1.0700, which contains quite large volume.
We can enter the market after a smooth correction of the price to the support to get a better risk/profit ratio. A stop loss should be set below the level 1.0686 – 1.0700. A potential of the deal is around 80-90 pips.
After the unexpected announcement of Theresa May the pound strongly went up almost for 300 pips on very-very large volume. After such a move it’s not wise to search for the short.
During this growth 3 support levels were created, but the most interesting for us is the level 1.2745 – 1.2773, which is the freshest one.
After the correction of the price to this level and a resuming of the growth we can enter the market and open long positions. We need such an additional signal, because often the price corrects after a very sharp growth. A stop loss should be placed below the support level. A potential of the deal is around 100 pips.
The yen continued its falling after the test of the resistance 109.21 – 109.34 and now is trading in a little consolidation below this level. Unfortunately, there is no a good situation for the trading this instrument: we don’t have fresh levels and a return to the resistance, most probably, will mean the will of the price to break it out.
So if you are out of the market, it’s better to stay there. If you have a short position, be careful and close the deal in case of appearance of any reversal signal.
Despite the growth of the pair, we still can’t point out any new level or zone that can be used for trading of this instrument. Overall, USD/CAD is trading in the consolidation, so now we should better be out of the market, moreover, we have interesting situations for trading for other currency pairs.
AUD/USD has broken down the level of support and, more likely, is going to test the global level of support 0.7501 – 0.7510. But it’s too early to open short positions – the situation is a pretty complicated, because the breakout was on small volume We can trade this instrument only in case of a strong reaction of the price to this level. Before that it is advisable not to trade this pair.
On Tuesday, the price of gold tested the support level of 1281.00 – 1283.20 and after the formation of large volume at the bottom of this movement, the price rebounded back up. Thus, we can talk about the full buy out of this bearish impulse by buyers. Also, it is worth highlighting the more recent level of support 1279.50 – 1281.00, in which large volume is concentrated, that kept the price from further falling.
Given the uptrend, a fresh level of support and a strong rebound of the price from it on a large volume, it is worth considering purchases as a priority scenario for gold trading.
Long positions should be opened after the end of correction and the beginning of a price growth. Of course, you can open purchases from the current price, but the first option is more secure, because it makes clear that the bulls are back in the market and are going to push the price up.
A stop loss should be placed under the support level of 1279.50 – 1281.00. The goal is a local maximum. If the price reaches this mark, it is better to move the stop loss to the breakeven and expect further gold growth until the reversal signal appears. The total potential of the deal is about 150 points.
The sentiment: our deals for EUR/USD, GBP/USD and gold are confirmed. Also sentiment shoes that, most probably, the yen will go down further, but there is no a good situation for trading it.
The bottom line: the euro and gold are in priority today. Watch for the pound too.