Low Volatility Here To Stay

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Forex Market News

First session back for the US and it was tight ranges all-round. It seems the low volatility is here to stay for some time yet. This means trading on day charts will continue to be a challenge and looking for lower time frame entries and trends will be key to decent returns. 

I notice that commodities, iron ore, oil and gold, fell and this despite Israel getting hammered by bombs and Ukraine stepping up its offensive in eastern parts of its country. It seems the ISIS and Putin are on the back foot and seen as not a real threat to price stability anymore. Stocks got hit smalls as some profit taking came in, and bonds were a mixed bag. The Friday night jobs data, whilst good has a number of sceptics about its validity. Also though, the inflation and GDP numbers in the US are not following the jobs numbers so, it is seen as a rogue figure for now.

Over here in Indonesia the country is gearing up for tomorrows Presidential vote. It seems to be a 2 horse race between an ex-military general with dubious background, Subianto, and the Governor of Jakarta, Widodo. Most likely Widodo will win as Subianto is seen as corrupt.

 

DATA HIGHLIGHTS TODAY – Aussie Biz confidence. German Trade Balance. UK Manufacturing Production. 

 

AUDUSD – There is an entry signal to go long on the Aussie today, if you believe in the fundamentals behind a higher currency, then the technical are with you today too. Personally I do not see it yet. Not to be left behind though I may look to put a small amount of capital into the trade. 

Resistance: 9460/9522

Support: 9200/9085/8900

 

EURUSD – We are short in this trade and stops should be moved to protect capital and or profit as overnight produced a test bar. Not really testing anything of note so I wouldn’t bring stops in too tight just yet.

Resistance: 13650/13890/14050

Support: 13565/13500/13488

 

GBPUSD – Another ring high with a seller bar. A sell signal for today and the risk:reward ratio looks ok to start with. 

Resistance: 1.7183/1.731.7370

Support: 1.66/1.63

 

NZDUSD – An engulfing buyer bar really gives me no indication as to future direction. More chop ahead I would say.

Resistance: 8745/8842

Support: 8523/8434/8090

 

USDCAD – Headlines have finally caught up with what we have known for some time. And it’s like the old saying, “when a taxi driver gives you a tip to buy, it is time to sell”. http://www.bloomberg.com/news/2014-07-07/canada-dollar-bears-turn-bullish-first-time-in-16-months.html . Last week saw the COT turn negative for first time since Feb. Whilst I am still bullish the Loonie, especially after last night’s building permits, some profit taking will come in. The technical setup is there for a phase 2 trade pullback to the ema or resistance. 

Resistance: 10802/10950

Support: 10683/10655/10486

 

USDJPY – Still chopping about with little interest from this speculator. 

Resistance: 105.57/108.35/110.50

Support: 101.30/100.62/100/99.80

 

 

David Long / Proprietary Trading Manager

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