The Euro showed an abrupt drop of the price yesterday. Besides, the fall of the pair was supported by the large volume, which is a great bearish signal. Unfortunately, the volume was evenly spread throughout the chart, so we cannot point out any concrete level or zone. Nevertheless, we should give preference to short positions with EUR/USD at the moment.
We can enter the market after a small and smooth correction of the price upwards, in order to obtain a more profitable entry point. A stop loss should be placed just overhead the beginning of the sharp drop. The potential of the deal is more than 100 points.
Yesterday, the Pound showed a fairly sharp drop on the increased (relatively) volume, but after the formation of the new volume support level 1.3312 it began adjusting upwards. It should be noted that the growth was smooth and on the small volume, so we can not consider purchases at the moment, and given the presence of a strong local downtrend, it is necessary to give preference to sales.
Short positions can be opened after the end of the correction, the resumption of the fall and a sure breakdown of the new level of support on an increased volume. A stop loss should be placed just above the breakout bar. The potential of the deal is more than 120 points.
The Yen continued falling and broke down the previous support level, which is an excellent signal for the opening short positions. Beside it, we should highlight the new volume resistance level of 110.33, which has already been tested. Therefore, we should give advantage to sales at the moment. We can enter the market after a small correction of the pair up, in order to obtain a more profitable entry point. A stop loss should be located a little above the resistance level. The potential of the deal is about 100 points.
Nothing has changed with the Canadian dollar as the price is still locked in the local range between 2 strong levels: the support 1.2750 and the resistance 1.2985. Therefore, our previous scenario remains actual: new deals can be opened only after a swift and confident exit of a pair from the consolidation. The breakout movement should be supported by the large volume, which will be a more precise signal for entering the market.
The Australian dollar resumed growing after a smooth downward correction and is trading close to the local maximum/resistance level of 0.7600 at the moment. The rise was on the large volume, so we should consider the scenario of a breakout of this mark, which will be a good bullish signal. The breakout movement should be supported by the increased volume, which will be a more reliable signal for entering the market. A stop loss should be located below the breakout bar. The potential of the deal is about 70-80 points.
The price is still trading in the local range between two strong volume levels: the support 1282.80 and the resistance 1301.60 – 1303.50. Hence, the best decision with this instrument is just to wait for a sure and abrupt exit of the price from the consolidation.
The breakout movement must be rapid and supported by the large volume, which will be a more precise and secure signal for entering the market. Until that, while gold is located within the consolidation, it’s better to stay out of the market.
The sentiment: the mood of the market affirms our trading scenarios with EUR/USD and GBP/USD, which is a good additional signal. The situation is opposite with USD/JPY and AUD/USD, so we should be extremely cautious. As with all other pairs, it is necessary to wait for the exit of prices from local consolidations and only after that we can regard new positions.