The downward correction for EUR/USD continues and now the price is trading near the volume support level 1.1849 – 1.1868. The fall of the price was fairly smooth, but at an increased volume, so at this time it is not worthwhile to open long positions, even despite the global uptrend. The most reasonable option is to wait for the reaction of the price to the level of support and after that you can consider any trading options for this currency pair.
If the price rapidly breakout this mark on large volume, it is worth considering the scenario of opening short positions. A stop loss should be placed just above the breakdown volume bar. The potential for a fall is about 100 points. Given that there is a large accumulation of volume at the bottom of the chart, this scenario is very risky and is more suitable for intraday trading.
In the event that the price bounces upward on large volume after the test of the support, we can consider the option of opening long positions. A stop loss should be placed just below the support level. The target is 1.2050. Given that there is no resistance at the top, and an upward trend for the euro is still actual, this scenario is more likely.
Despite the strong bearish momentum yesterday, the price failed to continue falling and is trading in the local consolidation right now. Volume on the market is higher than average, but it is spread throughout the chart, so we can’t point out any new volume level or zone.
So that our previous scenario remains the same – we need to wait for appearance of large volume and the significant reaction of the price on them. After that we can consider any new scenario for this currency pair.
USD/JPY continued its rapid growth and now is trading near the higher boundary of the global consolidation. The upward move was supported by increased volume, which is a good sign of the further continuation of the growth.
In such a case we can consider the scenario of the breakout of the level 110.92 and after that we can open long positions. A stop loss should be placed below the breakout bar. The target is 112.10.
Due to the fall of the oil price, USD/CAD showed a strong and sharp growth yesterday. The move was supported by really large volume and the new volume level of support was created – 1.2597 – 1.2613. Given these facts we might consider opening long positions, but on the other hand there is a strong global downtrend.
So to be able to open purchases we should get an additional confirming signal. Such a signal will be a test of the support and strong bullish impulse up. A stop loss should be placed below the support with a little margin. The target is 1.2765.
The price fell down on Wednesday and now is returned trading back into the global consolidation, where large volume is concentrated. That’s why we can trade this currency pair only after the sure exit of the price from the range. Until that it is better to stay out of the market.
The price has broken down the previous level of support, but the move was on really small volume, so we can’t consider it as a reversal signal. On the other hand, the strong fall of gold this week was on large volume, which is concentrated at the top of the chart. Moreover, large volume is concentrated at the bottom of the chart too, so the price is trading between these two volume accumulations.
So we need to wait for further move of the price and the breakout of one of these volume levels and only after that we can consider opening any new deals for gold. But now there is no a good situation for trading.
The sentiment: the only confirmed scenario is long position for the yen. For all other instruments this indicator shows or equal meaning, or the pair is trading in the range, so it is useless.
The bottom line: the general situation on the market is really, really tough for trading, that’s why I advise you to be extremely careful today.