Marc Walton on January 26, 2014
Hi, VERY risky, dangerous markets for the next few days at least. The
Dow fell the most points since 2011. There are problems in emerging
markets. Argentina & Turkeys currencies are crashing. The weekend
was the annual jolly for the worlds main finance dudes in Davros,
Switzerland. There are ECB meetings Monday & Tuesday and its the
Feds statement on Wednesday!Any one of these in isolation would be cause for concern. All happening at the same time could lead to a financial meltdown or at the very least huge swings in currency prices. SO its make your mind up time. Are you a gambler or a professional, cold hearted trader? Personally I will leave the markets alone until after the Fed statement, unless……….
In my analysis for the year ahead which you can find here: Marc’s Forex Analysis for 2014 I explained how, wherever possible I would be looking for trades from weekly & monthly charts. That is my plan for the week ahead. If price makes major corrections then I will be concentrating on MAJOR area from these longer time frames.
Best advice is, if there is a major shift or the Dow continues to tumble, then WAIT for the dust to settle. Trying to dive in when markets are free falling is highly risky and even more so trying to pick tops and bottoms.
From my 2014 analysis already the Cad has moved 600 pips of my suggested 2000, the Euro/Gbp & Aud broke down and the $/Yen started on its journey northwards. If you missed them then this possible correction could give us some great opportunities for trades that could go over a 1000 pips each in the coming weeks and months, SO patience and discipline is key once more. If you have neither then walk away or you could lose your shirt!
Exotics
In recent weeks I have been looking at some new pairs. I am not going to analyze them on a regular basis and if you are a novice or struggling then leave these alone, but in recent weeks the $/Nok (Norwegian Kroner) has been my most profitable intra day pair! I show near the end of todays video some of the other pairs I have been watching inc Gbp/Cad, Nzd/Yen and a few more.
The following are areas I will consider if we see BIG moves. The intraday levels are for those of you who will ignore my advice and look for trades anyway BUT I won’t take them myself.
Euro/$: I do not like this pair at the moment and prefer to wait for price to move in one direction or the other. Intraday price has simply been bouncing between 1.3530 and 1.3700 if you must trade then watch those areas
Gbp/$: Longer time frame then 1.6300 is my chosen area for multiple reasons. We have the 55ema, 78.6% fib, support & resistance, whole number/psych level & a trend line, in other words, multiple reasons.
Intra day watch 1.6630 for swing shorts and 1.6400 for longs.
Aud/$: I predicted that price will hit 0.8500 in 2014 (its not rocket science the Australian Bank already told us they wanted that- now they are talking about 0.800). Price finally broke and closed below 0.8820 and that’s an intra day option to short. Personally I prefer 0.8900.
Keep your eye on Gold. Mary pointed out in the forum that there is an inverse head & shoulders on the daily chart and price broke the neck line last wek which could see a run up in gold. The AUd usually goes hand in hand with Gold, so that could see an even bigger pullback.
Euro/Gbp: I expect this pair to hit 0.7700 or lower this year. Price did make the move a few weeks ago and gave an entry at my chosen 0.8340. Intraday that’s an option. If there is a bigger move then 0.8400 is the area for me due to those multiple reasons once more. 78.6% fib, 200ema, strong previous support and resistance, whole number and price is currently outside the daily Bollinger bands
$/Yen: The yens are most susceptible to swings when stocks are tanking or booming. Senior member, Mary (Tradespotting in the forum – Pierres corner) is a master of these pairs and the effects of changes in risk aversion. For more up to the minute thoughts and suggestions for Yens I recommend you follow her posts this week
I expect this pair to hit 120.00 in 2014 and therefore I am only looking to long BUT all of them may take a big pull back first. This is a great opportunity in my book. Best place for me is 100.00 with my stop 150 pips below as explained in the video. 101.20 is the area intraday BUT very risky for all the reasons mentioned above.
Euro/Yen: Already broke THE major area of 140.00 if the markets are quiet tomorrow and things stabilize then that is the area for potential longs BUT I won’t touch any yens at the moment
Aud Yen: Fell off a cliff! Once again, NOT MESSING WITH THIS. Broke and went in to free fall. If price pulls back to 90.00 then I might consider a short, but not an easy one to call.
Usd/Cad Already moved 600 pips towards my target of 120.00 a pull back would be a great opportunity to long. Preferred area is 1.0800 for multiple reasons. Intraday look at 1.1030 but not for me. The Cad is prone to roller coaster moves, not for the faint hearted!
Exotics: I show at the end of todays video how the $/Nok has been my most profitable intra day pair in recent weeks and a few other pairs I don’t normally trade but that are in technically very interesting areas. See video for the details.
New members please note: If I am looking to take a trade long, at for example 1.5000 , I place my order 10 pips above & 10 pips below for a short. This is because price often does not quite reach a major line and you need to allow for spreads.
We are NOT a “tipping service” our aim is to teach you how to trade for yourself. For more up to the minute updates do not forget to drop by the forum