Note that this is my current view, but if market conditions change my view can change too. Generally I will trade in alignment with what I have noted here, though I will wait for a set-up before I enter. I base my view on technical and fundamental information. I will list this with the market type. This is my beliefs and you are welcome to have opposite ones. Having a plan is more important than the actual direction for me.
- Short GBP/USD ( Trend – Bear normal market type.)
- Long USD/JPY (Reversal – Off the bottom of a wide sideways market type, but be wary of a push lower.)
- Waiting AUD/USD (Market type is normal sideways.)
- Short EUR/USD (Trend – Strong bear. But the euro has the potential to go up if Germany does not support any form of European QE and Draghi does not want to go against the consensus there. Scaling-in preferred.)
- Waiting NZD/USD (Market type is normal sideways.)
- Waiting USD/CHF (Wait for the SNB decision to play out- My condolences to anyone that got burned on the CHF last week.)
- Long USD/CAD (Trend – Strong bear, but could be about to have a pull back or enter a sideways market.)
- Waiting AUD/JPY (Market type is sideways.)
- Long NZD/JPY (Reversal – Market type is sideways and an opportunity exists off the bottom off the range. Low conviction opportunity only based off action on the cross rates and fundamentals on the NZD.)
- Waiting GBP/NZD (Market Type is quite a volatile sideways, but currently looking a bit bearish.)
- Long AUD/NZD (Reversal – I have more conviction on this trade.)
- Short EUR/GBP (Breakout – Strong bear market type. Take a look at the monthly chart and you will see the long-term bear market and the break below key monthly support. If you believe the macro picture favors the UK and like breakouts then this could be a good move to get in on.)
- Short EUR/AUD (Volatile sideways market type in a downward phase. look for the price to reach 1.3800 before a potential reversal or continuation.)
- Short EUR/NZD (Breakout – Strong bear market type. Check out the monthly chart on this to see the importance of the level that was just broken. I see the macro picture favoring this trade, with flows from CHF and EUR into NZD, but I don’t hold the greatest confidence in NZD fundamentals. Still this could be a good opportunity to diversify from a short EURUSD trade. Just be wary of the market discovering/ uncovering flaws in NZD fundamentals.)
- Waiting GBP/AUD (Market type is currently sideways – or we could be experiencing a pull-back. Best to wait and see what plays out.)
Trend: Market is trending in the direction I have listed and I expect it to continue.
Reversal: I am looking for a reversal against the current trend
Breakout: The currency pair is breaking out of a range
About the Author
Sam Eder is a currency trader and author of the Definitive Guide to Developing a Winning Forex Trading System and the Advanced Forex Course for Smart Traders (https://fxrenew.com/forex-course/). He is part owner of Forex Signal Provider www.fxrenew.com (You can get a free trial). If you like Sam’s writing you can subscribe to his newsletter for free (https://fxrenew.com/newsletter-sign-up).