Yesterday, the Euro showed a strong and sharp growth of the price of the very large volume, which is a strong bullish signal. It is also necessary to note the new level of support that was formed during this movement. This is the level 1.2368 – 1.2382.
At the moment, the price is locked between this level and the resistance 1.2520, so we can consider 2 scenarios for opening purchases:
The first scenario: long positions after a small price correction down. A stop loss should be placed below the level 1.2368. The target is 1.2520.
The second scenario: purchases after a confident and sharp breakdown of the resistance level. A stop loss should be placed under the breakout volume bar. The potential of the deal is more than 100 points.
The Pound also showed an abrupt growth yesterday. We should note that the upward movement was supported by the average volume, that was evenly spread throughout the move, so we can’t point out any new levels or zones.
Anyway, given the strong bullish impulse, we should regard long positions at the moment.
We can enter the market after a smooth downward correction of the price and a resumption of the sharp growth on the large volume, which will be a more reliable signal for opening new deals here. A stop loss should be placed below the beginning of the sharp growth. The target is the level 1.4150.
The Yen continued falling, moreover, the move was supported by the large volume. So we can state that the downtrend with this currency pair is going on, so now we should consider exceptionally short positions.
We can enter the market after a smooth correction of the price up, in order to get a better entry point. A stop loss should be placed above the level 107.50. A potential of the deal is more than 120 pips.
The price fell down sharply and is testing the level of support 1.2488. Given that the move was supported by large volume, we should regard the scenario of a breakdown of this level, which will allow us to open short positions.
The breakdown movement must be abrupt and supported by the large volume. A stop loss should be placed above the breakdown volume bar. A potential of the deal is around 110-120 pips.
The Australian dollar is testing the level of resistance 0.7943 – 0.7957 at the moment. We should note that the price grew up strongly and on the large volume yesterday, so we should consider the scenario of the breakout of this mark, which will be a good bullish signal.
The movement must be sharp and supported by the large volume, which will be a more accurate signal for entering the market. A stop loss should be placed below the breakout volume bar. A potential of the deal is 80-90 pips.
Gold grew up sharply yesterday and broke out the previous level of resistance. Moreover, the movement was supported by the huge volume and the new level of support was created, it is 1346.10 – 1349.00.
Given all the factors above, we should give advantage to long positions with gold.
We can open purchases after a small and smooth downward correction of the price, in order to get a better entry point. A stop loss must be placed below the new support level. A potential of the deal is around 120 pips.
The sentiment: almost all (except USD/CAD) our trading scenarios are confirmed by this indicator which is a great additional signal. So today we should trade more actively.