Marcs Weekly Analysis

Marc Walton on September 14, 2014 

 

Hi, we have spoken a great deal about fundamentals in recent months and how important it is to analyse whats causing price action. We look at data the same way astock trader investor looks at a companies balance sheet.
We also gauge sentiment and then use techncial analysis to find our entries. Technical analysis is the final part of the puzzle and we are looking for repeatable patterns.
So what do we do for the week ahead with the British Pound? Fundamentally and sentiment wise its impossible to gauge because of the Scottish referendum this week and then technically this situation has never arisen in the previous 300 years so a little before chart patterns were used in trading!
So what do we do re the Gbp and all its pairs? Absolutely nothing! Its a mugs game and certainly trades taken will be by those who like to gamble, not those who wish to trade professionally using strict risk and money management
One of the members asked me if it was worth “hedging” a Gbp trade. In other words place a buy order below and a sell order above? Well it could work, Then again both could lose and if price jumps stops which it could well do your risk will have been incalcuable. Best advice, avoid the temptation and walk away
My personal suspicion is that it will be a no vote and not as close as polls are suggesting BUT thats a guess and I could be totally wrong. The Britsh establishment heavyweights are now belatedly touring Scotland & hammering the point that the Scots will lose out big time from a break up of the union and therefore opinion appears to be shifting away from hearts to heads.
There are further implications should a yes vote win. Scotlands position in Europe. Which currency would they use? More worryingly for politicians and economists alike will the Welsh, Catalans, Basques follow suit which would be a mini revolution within Europe which as we know is in a big enough mess without the additional hassle!
Its a pain in the butt as I show in the start of today’s video how there is a perfect set up arriving on the Gbp/Cad but hey ho thats forex. Lets see if there is anything else thats safer to trade this week:
Its important to watch your calendars as there is importnat red flag spread throughout the week and be especially careful around the Fed announcement. Last week we had a lot of decent big gaps at the market open which could happen again, if so I show you here how I trade them: How To Trade Gaps


Forex Week Ahead
Avoiding the Gbp pairs, these are what I am looking for to trade:
Euro/$: Stopped to the pip at monthly 200 ema, now Messy. Only want to short but need a pull back or price to break 1.2800 then pull back. A forward order would be way back at 1.3400 which seems unlikely now. If you are trading intra day you will need to look at levels for yourself.
Chf: Also stopped at a major ema. Candle formation also suggests move back down. Is it a reversal or a pull back? I favour the latter and will place a forward order to long at 0.9100 for multiple reasons: 78.6% fib, support & resistance, trend line, emas- need I say more
Euro/Yen: Huge candle last week I would need a pull back. 137.50 is the area for me but to watch on daily charts not a forward order. Swing traders will be looking to short at 140.00 as its the top of a major weekly trend line.
Aud: Despite VERY impressive jobs news last week the Aud fell off a cliff, probably due to weak Chinese data. I wouldn’t take now but will short if price pulls back to 0.9200
Aud/Yen: Pullback or reversal? If its the former then a long at 96.30 is the place for multiple reasons
$/Yen: Huge candle last week, This has been messy all year so not overly confident but 105.00 is first palce to look for pullback/bounce
Cad: Only interested to long. Intra day look for pull back to Fridays break at 1.100, more conservative entry is 1.0850
Nzd/Usa: I will place a forward order to short at 0.8400 for multiple reasons and possible 1: 5 risk reward. Intra day watch 0.8250 to short.
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.
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