As expected, after a prolonged price growth for 2 weeks, the euro started correcting down. It is worth noting a strong bearish momentum on increased volume from the local maximum. It is also necessary to note a new resistance level 1.1231-1.1243, in which large volume is concentrated, that sharply pushed the price down.
Thus, before breakdown of this level, it is not necessary to consider the scenario of purchases for the euro. Nevertheless, given the uptrend, longs are still in priority in the medium term.
But intraday we can try to work from short positions from the resistance level 1.1231 – 1.1243. It is necessary to wait for the correction of the price to this mark and after the resumption of the fall on increased volume, it is possible to open sales. A stop loss should be set for the level 1.1243. The target is 1.1100.
Of course, trading against the trend is not in my rules, but the probability of a correction is quite high.
The pound, unfortunately, could not breakout the resistance 1.3040 and returned trading back in the consolidation. So we do not have a good situation for trading now as a price is in the range.
Yes, we can highlight a new resistance 1.3008 – 1.3017, but we still need to wait for the exit of the pair from it and a beginning of the trend, until that we should stay out of the market.
The yen failed to continue falling and tested the resistance 111.70 – 111.90 after a strong bullish momentum. The price is trading inside this level now.
If the pair breaks it out, especially on large volume, we can consider opening long positions for USD/JPY. A stop loss should be set below the breakout volume bar. The target is 113.10.
If the price rebounds back on very large volume, our previous scenario of opening short positions will become actual.
USD/CAD showed a smooth correction of the price due to a strengthening of the US dollar and a fall of the oil price. But anyway, given the downtrend our scenario of opening short positions is still relevant.
We can enter the market after a stoppage of the growth and a beginning of the fall on increased volume, that will tell us that bears are still dominating the market. A stop loss should be set at the level 1.3600. A potential of the fall is around 100 pips.
The Australian dollar fell down and is trading in the consolidation now. The move down was on small volume, so it can’t be regarded as a reversal signal, but we can’t open long positions until the resumption of the growth.
But unfortunately, we do not have a strong support level that can act as a good place for a stop loss + there is a strong pin-bar on D1.
So the whole situation is unclear now. In such case I advise you just to skip this instrument from your trading plan for today.
After a breakout of the previous resistance, gold failed to continue its uptrend and fell down sharply and on increased volume. It is necessary to point out the new resistance level 1261.10 – 1263.20. It contains large volume + it’s a local maximum.
Also we need to highlight a strong accumulation of volume inside the local consolidation. If the price breaks out the lower boundary of this consolidation it will be a good signal for opening sales and the accumulation will act as a resistance. Besides it, this will be a sign of possible end of the uptrend for gold.
So if the price breaks the level 1247.00 on increased level we can enter the market and sell the instrument. A stop loss should be set above the breakout volume bar. A potential of the fall is more than 120 pips.
The sentiment: the market seems to be changing now, but the sentiment of it have not reacted yet. That’s why many scenarios are not confirmed, but not canceled as well.
The bottom line: the yen and gold seems like two best instrument for trading today. Also intraday scenario of selling the euro is quite promising.