The uptrend for the euro continues, with the price rising on increased volume, which is a good sign for further upward movement. Nevertheless, after such a rapid growth, there are often corrections, so you should be extremely careful not to get trapped.
It is also necessary to point out a new level of support 1.1067 – 1.1075, in which very large volume is concentrated.
Given all factors, long positions should be in priority for the euro, but it is worth waiting for a good entry point.
The best option will be a downward correction and a test of the support 1.1067 – 1.1075, after which the price rebounds on the increased volume. Correction should be smooth and without volume (or on small volume).
This will signal a continuation of the trend + a favorable price for the entrance. A stop loss should be placed under the level 1.1067. The potential for growth is about 60-70 points. The risk/profit ratio is 1 to 2, which is an acceptable scenario for us.
The situation for the pound remains the same: the pair is trading in the consolidation. Volume in the market is medium and spread across the chart, so it is impossible to point out any fresh levels or zones.
So, unfortunately, this instrument is difficult to trade now, so it will be better to skip it from our today’s trading plan.
The yen fell down strongly on large volume. This move cancelled our scenario for opening long positions.
Thus, it’s too early to start selling, because we still have a strong uptrend for the yen. Besides it we don’t have a good place for a stop loss.
We can open short positions only after the fall of the price below the level 111.95. It is the lower boundary of the consolidation, where large volume was concentrated.
It is necessary to highlight the new level of resistance for USD/CAD – 1.3605 – 1.3615, where quite large volume is concentrated. Moreover, the price is testing this level now.
So if the pair rebounds from the resistance on really large volume and sharply, we can open short positions. A stop loss should be placed above the level 1.3615 with a little margin. A potential of the fall is around 90-100 pips.
AUD/USD is still trading under the level of resistance 0.7441. It is important to point out that the price could not rebound from the level, so our previous scenario remains the same: after a confident breakout of the resistance we open long positions. A stop loss should be placed below the breakout volume bar. A potential of the deal is around 60-70 pips.
Gold had broken out the level of resistance and after a small correction grew up further. The new level of support is important to point out – 1234.10 – 1236.00. It contains large volume that caused a continuation of the growth.
All these factors confirm our previous scenario of opening long positions. We can enter the market after a smooth correction of the price to obtain an acceptable price for enter. A stop loss should be placed below the level 1234.10. The first target is 1250.00, the second – 1257.70.
The sentiment: the mood of the market is getting changed, so it’s difficult to use it for analyzing now. Only the euro deal is confirmed, for all other instruments the indicator is changing, especially for the yen and gold.
The bottom line: deal for gold is my pick for today. The euro and the Australian dollar also have pretty interesting scenarios.