After the speech of J.Yellen the euro fell down strongly against the US dollar on increased volume. But despite that fact, the move of the pair was stopped by fresh level of support 1.1406. Also we need to point out the resistance level 1.1470, from which the price began its fall.
So overall the euro is locked in the consolidation.
That’s why we can consider 2 possible scenarios of trading EUR/USD:
Given the uptrend, long positions has a priority, but we still need to wait for the exit of the price from the range.
Despite a good technical picture for further price fall, GBP/USD showed a strong and sharp growth against the backdrop of fundamental factors. As a result, the pair is trading near resistance level 1.2904 – 1.2915. Also it is worth noting the new level of support 1.2819 – 1.2828, in which large volume is concentrated and which pushed the price up.
Thus, before the breakdown of the support level, it is not necessary to consider the scenario with the opening of short positions, and considering the yesterday’s sharp price movement upwards, it is necessary to consider the option of opening long positions after the breakout of the resistance level 1.2904 – 1.2915.
The breakout of the level must be sharp and supported by large volume to avoid false movements. A stop loss should be placed under the breakout volume bar. The target is 1.3020.
If the price continues trading in the consolidation between the two levels, it is better to stay out of the market.
The situation for the Yen remains the same: there is a strong global uptrend, but the price is strongly going down. yesterday the pair also showed an abrupt fall on increased volume, but it was spread throughout the move, so it is impossible to point out any new levels or zones.
That’s why I advise you to stay out of the market for USD/JPY today.
USD/CAD fell down incredibly strong after the rate decision and BOC statement. The move was supported by really huge volume. Also the new resistance was created, it’s 1.2813 – 1.2830. It contains pretty large volume.
Given these facts, we should consider only short positions. We can enter the market after the smooth correction of the price to obtain a better entry point. A stop loss should be placed above the level 1.2830 with a little margin. A potential of the fall is more than 100-110 pips.
The Australian dollar grew up and created a new level of support 0.7660 – 0.7669, which contains large volume. So we can consider that the uptrend continues, that’s we we should open only long positions.
We can enter the market after a smooth correction of the price to the support. A stop loss should be placed below the level 0.7642. A potential of the deal is 60-70 pips.
The price showed a pretty sharp growth yesterday, which was supported by increased volume and has tested the level of resistance 1224.00. Now gold is trading near this level . It is the cornerstone of trading this instrument, as its breakout opens the way up.
The breakout move must be sharp, confident and supported by large volume. After that we can enter the market and open long positions. A stop loss should be placed below the breakout volume bar. The target is 1245.00.
As for short positions, we can deliberate them only in the case of the strong bearish momentum from the current level.
The sentiment: our scenarios for GBP, CAD and AUD are confirmed by the mood of the market. All other scenarios are under the question.
The bottom line: CAD and AUD are in priority today. GBP is also very interesting, but we need to wait for the breakout of the resistance. The same situation for gold. For the euro it is necessary to wait for the exit of the price from the range.