The price demonstrated an abrupt drop supported by the huge volume, but it is still located inside the local consolidation between 2 strong volume levels. The first one is the level support 1.1121 and the second one is the level of resistance 1.1266 – 1.1276.
Therefore, we can open new positions only after the sharp exit of the price from this consolidation. Furthermore, the movement must be supported by the large volume, which will insure us against a fake breakout.
While the price is located inside this consolidation, we’d better stay out of the market.
The price also fell down sharply yesterday, but the move was on the average volume, so that we can’t point out any new volume level or zone. Moreover, the price is still located above the level of support 1.3025. Thus, we still prefer a scenario of opening long positions.
We can enter the market only after a stoppage of this drop and a resumption of an abrupt rise, supported by the large volume. In such case, we can put a stop loss below the level of support. A potential of the deal is more than 120 pips. So with the Pound, long positions are still in priority.
If the price breaks down the level of support, we should stay out of the market.
The Yen showed an abrupt growth supported by the large volume, however, it is still located within the local consolidation between the support 111.06 and the previous level of resistance 112.24. That’s why, the best solution with the Yen is just to wait for a breakout of one of these levels and a sharp exit of the price from the range and only after that we can open new positions. The breakout movement must be keen and supported by the large volume, which will be a more accurate signal for entering the market.
While the price is locked inside this range, we’d better omit this instrument from our trading plan.
The Canadian dollar grew up significantly and on the large volume, however, the price is located within the local consolidation between the level of support 1.3382 and the level of resistance 1.3459. Therefore, the best solution with this instrument is just to wait for the exit of the price from the range and only after that we may consider new positions. Moreover, the breakout movement must be sharp and supported by the large volume, which will be a more secure and precise signal for entering the market.
Until that, we’d better stay out of the market.
The Australian dollar fell down sharply and broke down the previous level of support, which is a strong bearish signal. Thus, we should give preference to short positions. We can enter the market after a smooth upward correction of the price, in order to get a more profitable entry point. A stop loss should be placed above the level of resistance. A potential of the deal is more than 80 points.
Gold showed a significant and sharp drop on the very large volume yesterday, which is an excellent bearish signal. At the moment, the price is trading near the support/lower limit of the local consolidation 1267.30. Thus, we can open short positions only after a confident breakdown of this mark.
Moreover, the fall of the price should be supported by the large volume, which will be a more accurate and reliable signal to enter the market. A stop loss should be placed slightly above the breakout volume bar. A potential of the deal is more than 150 points.
The sentiment: this technical indicator totally confirms our scenario with GBP/USD, AUD/USD and gold (as we trade against the “crowd”), which is a good additional signal. As with other currency pairs, we can open new positions only after the sharp exit of prices from local ranges.