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Australian dollar started the week on the front foot and is approaching 0.7975 - 0.80 area, where it is likely to encounter at least some resistance. It's Martin Luther King Day today in the U.S. - thinner liquidity could lead to either tighter volatility or outsized moves.
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EURo pauses after Friday's fireworks
There was quite some activity in some majors this morning. Aussie rallied after RBA held rates steady and released a neutral statement. Cable spiked about 180 pips after a large order in thin liquidity went through on no particular news.
Euro, however, has been trading in 1.1325 - 1.14 range since last Friday, mostly pinned to 1.1350. The range top is the initial resistance before 1.145 - 1.15 (early April highs, 2015 highs) and then 1.1575 - 1.1625 (May high, 2005 low). 1.1315 (50 DMA) is the i…
Euro, however, has been trading in 1.1325 - 1.14 range since last Friday, mostly pinned to 1.1350. The range top is the initial resistance before 1.145 - 1.15 (early April highs, 2015 highs) and then 1.1575 - 1.1625 (May high, 2005 low). 1.1315 (50 DMA) is the i…
Currencies opened with gaps
Currencies opened the week with with risk-off gaps: euro, franc and yen gained about 10 pips, pound lost a couple of pips while commodity currencies lost 20-60 pips. All gaps have been already closed as risk sentiment improved.
U.S. banks will be closed today in observance of Martin Luther King Day - that means thin liquidity and tight ranges but not without a possibility of an outsized move.
U.S. banks will be closed today in observance of Martin Luther King Day - that means thin liquidity and tight ranges but not without a possibility of an outsized move.
Huge moves to start the week
Thin summer liquidity may have contributed to today's rout in the markets. China and global growth worries, commodity (especially oil) price falls and incoming Fed tightening are being cited as the main reasons for the current risk-off sentiment.
Daily range in USD/JPY was almost 600 pips or 4.5% (largest since 1998), but that seems little in comparison with EUR/NZD (1550 pips) and GBP/NZD (1600 pips). Euro, Swissie and Cable all benefited and are up 100 - 200 pips on the day.
Daily range in USD/JPY was almost 600 pips or 4.5% (largest since 1998), but that seems little in comparison with EUR/NZD (1550 pips) and GBP/NZD (1600 pips). Euro, Swissie and Cable all benefited and are up 100 - 200 pips on the day.
Range trading prevails
Both ADP Non-Farm Employment Change and ISM Manufacturing PMI came out weaker than expected and USD/JPY is (again) testing 119.50 after being down there in Asian session. Overall, range trading prevails as Easter holiday closing in and liquidity getting thinner. But that's not to say an outsized move is not possible.
Today's Price Action
Despite no major news even today, we have seen whipsaw price action on lots of forex pairs taking out stop loss on both sides, which is very common practice amongst smart money in time of low liquidity, as it is easier for them to create volatile price action, as the quantity of orders on the opposite side is thin, hence it is an ideal situation to create such volatile price movement.
Many retail traders would be looking at price chart now and would be upset and thinking, as to how they missed t…
Many retail traders would be looking at price chart now and would be upset and thinking, as to how they missed t…
Reasons to enjoy your Xmas
I will give you a couple of reasons to enjoy your Xmas, and give it a rest during these holiday's
First of all you need a rest - you have been working hard for a long time, your head is filled with charts and analysis
and it needs a rest - a distraction to be able to reload, and go at it freshly again
I you don't change your focus now and then -away from the markets- your brain will snap, or overload,
and then you will be in trouble - you will make crazy decisions, or just get ill
Secondly, most…
First of all you need a rest - you have been working hard for a long time, your head is filled with charts and analysis
and it needs a rest - a distraction to be able to reload, and go at it freshly again
I you don't change your focus now and then -away from the markets- your brain will snap, or overload,
and then you will be in trouble - you will make crazy decisions, or just get ill
Secondly, most…