The Euro rose and tested the resistance level/upper boundary of the local consolidation 1.1628 – 1.1648 yesterday, but failed to break it out. However, the pair didn’t demonstrate a significant rebound and is trading near this mark at the moment. Therefore, we can consider a scenario of its breakout, which will consent us to open long positions.
The move should be sure and abrupt + supported by the large volume, then it will insure us against a fake breakout. A stop loss should be located just below the breakout volume bar. The potential of the deal is about 90 points.
The Pound also grew up and tested the resistance level 1.2952 – 1.2970, but failed to break it out and is located just below this level at the moment. Therefore, we can regard a scenario of its breakout, which will be a great bullish signal.
The movement must be rapid and supported by the large volume, which will be a more precise and secure signal for opening purchases. A stop loss should be located just below the breakout volume bar. The potential of the deal is 140 points.
If the price continues trading inside the local consolidation, it is better to stay out of the market.
The Yen demonstrated a keen drop on the increased volume, nevertheless, the pair is still trading within the local consolidation between 2 strong levels. They are the support 109.82 and the resistance 111.94. Hence, we can consider new deals only after the sure exit of the price from the local range. The breakout move must be abrupt and supported by the large volume, which will be a more precise and strong signal for entering the market.
The Canadian dollar tested the resistance level 1.3203, after which it rapidly adjusted down. The drop was supported by the very large volume, so in spite of the presence of the price near the resistance, we must regard 2 trading scenarios:
The Australian dollar continued its downward movement yesterday and is now testing the support level/local minimum 0.7155. Given that the fall was sharp, as well as the presence of a strong local downtrend, we should consider a scenario of a breakdown of this mark, which will be an excellent bearish signal and allow us to open short positions. The breakout movement must be confident, sharp and supported by the large volume that will insure us against a fake breakdown and will be a more accurate signal for entering the market. A stop loss should be placed just above the breakdown volume bar. The potential of the deal is more than 100 points.
Nothing has changed with gold as the pair is still locked within the local consolidation between the support level 1190.00 and the resistance level 1215.70. The large volume is accumulated inside this range, so that we can regard new trading scenarios only after the sure exit of the price from it.
The breakout movement must be keen and rapid + supported by the large volume, which will be a more secure signal for opening new positions + will insure us against a fake breakout.
Until that, while the price is trading within the range, we should omit this instrument from our trading plan.
The sentiment: the mood of the market confirms our scenario with the Australian dollar, which is a good additional signal. As with the Euro and Pound deals, we need to wait for confirmation signals (breakout of resistance levels), as the sentiment has not changed yet. With all other instruments, we can open new deals only after the confident exit of prices from consolidations.