The euro showed a smooth correction on Monday and the price is trading near the volume support level 1.1309 – 1.1329. We should note that a downward move was on small volume, so we should not consider it as a reversal signal.
So our previous scenario remains the same: we can enter the market and open long positions after the test of the support and sharp rebound of the price from it. A stop loss should be placed below the level 1.1309 – 1.1329. A potential of the deal is 120 pips.
The pound totally copied the euro move and showed a downward correction of the price to the level of support 1.2897 – 1.2910. The fall of the price was quite sharp, but still it did not contain large volume, so we can’t deliberate is as a reversal signal.
So that a trading scenario for the pound is also the same: after the test of the support and a strong rebound of the price from it we can open long positions. A stop loss should be placed below the level 1.2897. A potential of the deal is 110-120 pips.
The yen has broken out the upper boundary of the consolidation and grew up strongly. The movement was on increased volume, that even strengthens its importance. Unfortunately, we can’t point out any new volume levels as volume during the move was spread throughout the chart.
Given the breakout and the presence of the strong uptrend we should regard long positions for USD/JPY.
We can enter the market after a resumption of the strong growth on increased volume. A stop loss can be placed below the beginning of the bullish impulse. A potential of the deal is around 100 pips.
The fall of the price was stopped and now the Canadian dollar is trading in the local consolidation near the minimum. This consolidation contains pretty large volume, so until the price exit from it, we can’t trade this pair.
But given the global downtrend, we should consider short positions as a priority scenario. We can enter the market after the breakdown of the local minimum 1.2960. A stop loss should be placed above the level 1.3014. A potential of the deal is 100 pips.
The uptrend for the Australian dollar is under the question now as the price fell down sharply due to the BOA rate decision. So the situation is complicated: there is a strong bearish momentum on the one hand, and a strong global trend on the other. That’s why the best decision will be to stay out of the market today.
After the breakdown of the support, gold continued falling. The downward move was supported by large volume + it was really abrupt, so these are good signals that the downtrend will continue.
Also we need to point out the resistance 1226.00 – 1228.70, which contains quite large volume.
Given all these facts, we should consider only short positions. We can enter the market after the test of the resistance and the strong rebound of the price on increased volume. A stop loss should be placed above the resistance with a little margin. A potential of the fall is more than 100 pips.
The sentiment: this indicator confirms all our deals which is a food sign for active trading today.
The bottom line: the best deals for today are the yen and gold. The euro, the pound and the Canadian dollar are also pretty interesting, but we need to get confirming signals.