As predicted, the Euro continued its decline yesterday. Moreover, the downward movement was sharp and supported by the large volume. In addition, it is necessary to allocate a new resistance level 1.1428, in which the large volume is concentrated. Thus, we should give preference exactly to short positions with this instrument.
We can enter the market after a small and smooth upward correction, in order to obtain a better entry point. A stop loss must be placed slightly above the new resistance level. The potential of the deal is about 80-90 points.
The Pound also demonstrated the sharp drop fall on the large volume yesterday. The volume was evenly distributed throughout the movement, so we cannot point out any particular volume level. However, we should give preference to short positions.
We can enter the market after a small and smooth price correction upwards in order to get a more profitable entry point. A stop loss should be placed just above the beginning of a sharp fall. The potential of the deal is more than 120 points.
The Yen goes on trading inside the local consolidation between the support level 111.74 and the resistance level 112.76 – 112.89. Hence, the best solution with the Yen will be to wait for a confident and keen exit of the price from the local range. The breakout movement must be supported by the large volume, which will be a more accurate and reliable signal to enter the market.
The Canadian dollar has resumed rising and completely swallowed the previous sink, which is an excellent bullish signal. The price is currently testing the resistance level 1.3121, so we can regard a scenario of its breakout, which will allow us to open long positions. The breakout move should be abrupt and on the large volume, which will insure us against a fake breakout. A stop loss should be placed under the breakout volume bar. The potential of the deal is more than 100 points.
The Australian dollar demonstrated a keen and sure drop on the large volume and broke down the previous support level. This is a great bearish signal, so we should give preference to sales. Short positions can be opened after a small correction upwards to get a better entry point. A stop loss should be placed slightly above the beginning of the breakout movement. The potential of the deal is more than 80 points.
Nothing has changed with gold as the price is still trading within the local range between the support level 1221.00 and the resistance level 1239.00. As can be seen from the volume chart below, the large volume is concentrated inside this consolidation.
Therefore, the best decision with gold is just to wait for a sure and sharp exit of the price from the range. Moreover, the breakout movement must be supported by the large volume, which will insure us against a false breakout and will be a more reliable signal to enter the market.
The sentiment: this indicator totally affirms all of our trading scenarios, which is an excellent additional signal. With all other pairs, we should wait for a confident exit of prices from local ranges.