The Euro showed a very strong growth on the large volume on Friday, which is an excellent bullish signal. Nevertheless, we cannot open new positions with this instrument, as the pair is still within the consolidation between the support 1.1517 and the resistance 1.1827.
Thus, we need to wait for a confident and sharp exit of the price from the local range and only after that we can consider new trading scenarios with the Euro. The movement should be supported by the large volume, which will be a more reliable signal for entering the market.
The Pound also showed a significant growth on the increased volume on Friday. Despite this, the pair is trading in the middle of the local range between the support 1.2970 and the resistance 1.3345, we can open new positions only after the breakout of one of these levels and the exit of the price from it.
The breakdown movement must be swift and supported by the large volume, which will insure us against a false breakdown and will be a more accurate signal for entering the market. While the pair is trading within the consolidation, it’s better to stay out of the market.
The Yen dropped and broke down the previous support level on Friday, which is an excellent bearish signal. It is also necessary to allocate a new resistance level 111.70 – 111.85, in which the large volume is concentrated.
Given these factors, we can consider a scenario of opening sales. Short positions can be opened after the test of the resistance and a sharp rebound of the price down on the large volume. A stop loss should be placed slightly above the level 111.85. The potential of the deal is about 100 points.
The Canadian dollar fell down very sharply and is trading within the volume zone 1.3112 – 1.3143 now. The decline was on the large volume, which allows us to consider a scenario of a breakdown of this mark, which will be an excellent bearish signal.
The breakdown movement must be confident and supported by the large volume, which will insure us against a false breakdown. A stop loss should be placed just above the breakdown volume bar. The potential of the deal is more than 120 points.
The Australian dollar rose significantly on Friday, but is still inside the local consolidation between the support 0.7318 and the resistance 0.7480. The large volume is concentrated in this range, so the best solution will be to wait for a sure exit of the price from it and only after this it is possible to consider new positions.
The movement should be supported by the large volume, which will be a more reliable and strong signal for entering the market.
Gold also adjusted upward, but the growth was on the average volume, and given the strong downtrend with this instrument, we cannot open purchases at the moment.
Thus, the best scenario is still to wait for the breakdown of the support level of 1213.00, which consent us to open short positions. The breakout movement must be sharp and supported by the large volume, which will be a more accurate and strong signal. A stop loss should be placed just above the breakdown volume bar. The potential of the deal is more than 150 points.
If the price continues adjusting upward on the small/medium volume, it is better to stay out of the market.
The sentiment: this indicator has not yet fully reacted to the sharp change in the market situation on Friday, but there is a noticeable shift with the Yen and the Canadian dollar towards purchases (which confirms sales). With gold, our scenario is confirmed, with all other currency pairs, we need to wait for prices to come out of ranges.