FX Trade Journal

Profit taking following a strong Euro rally as the market factored in Euro Zone resilience; along with a stronger US-DOLLAR will see the EURUSD correct to the downside in the short term with key support at 1.0900 levels. Overall Euro strength remains on deck in the medium term as the ECB is looking forward to possible tapering, along with a US-Dollar low which could see the EURUSD rally to 1.1400 - 1.1500 levels. These levels will not sustain, in the wake of German elections especially if the US-Dollar forms lows during June - July.   

With a mildly softer Greenback and as polls for the upcoming French elections turn pro-Eurozone the EURUSD is set for a recovery to the 1.0900 level Upcoming trades Entry to short @ 1.0800 with t/p @ 1.0710 and s/l @ 1.0850 Entry to long @ 1.0700 with t/p @ 1.0900 and s/l @ 1.0600

Recent polls indicating that Macron is gathering support for the upcoming French elections in may month averts the risk of a Frexit, however uncertainty still hovers around the stability of the Eurozone this year. Now that the Fed is anticipated to raise rates three possible scenarios exist for the EURUSD in the short-term future. 1) Fed holds rates as is which will lift the EURUSD to 1.0800 resistance level. 2) Fed raises rates and indicates two more rate rises in 2017 will drive the EURUSD down to 1.0400 level. 3) Fed raises rates and indicates three more rate rises in 2017 will drive the EURUSD down to 1.0250 level.

Although risk sentiments have weighed in on the EURUSD resulting in the pair trading as low as 1.0400 and US Dollar Parity seems imminent for the pair during 2017, the upcoming US Dollar correction amidst strong European fundamentals such as increasing inflation and increasing manufacturing activity will send the pair upwards to the 1.0900 levels with key resistance levels at 1.0600, 1.0700 and 1.0800. Risk sentiments for the Eurozone during 2017 include the upcoming German and French elections and parity with the US Dollar will only be reached should the elections result in increasing Nationalist sentiments. 

Eurozone Data and especially German data continues to show signs of economic recovery in the Eurozone, however political risks of the upcoming Italian elections amidst a stronger Greenback will send this pair down to test 1.0500 support and possibly breakout to 1.0400 levels.

European data seem to indicate a more positive Eurozone economy in the months to come however as investors position take on risk and position themselves for the upcoming interest rate hike the EURUSD is likely to push down to the 1.0600 and 1.0500 levels

Dollar advance to push the EUR/USD down to 1.0800 support level. Trade : Entry to sell @ 1.0900 with T/P @ 1.0800

As positive data help lift the Euro against the greenback, the upcoming November disappointment over Interest rates from the Fed amidst political risk will send the Euro soaring to the upside, targeting 1.1100. Investors will then start pricing in the upcoming rate hike of December sending the Euro-dollar down to 1.0800. Trade: Entry to buy @ 1.1025 with T/P @ 1.1100 then Entry to sell @ 1.1105 with T/P @ 1.0810

Following last week’s major Euro sell off, traders are likely to buy the discounted Euro ahead of the upcoming UK and US GDP releases. Trade: Entry to buy @ 1.0900 with T/P @ 1.1050 and S/L @ 1.0850

USD Supported by decreasing Jobless claims which currently is at a decade low, the USD is set to test its yearly high at 12,306 (FXCM Dollar Index) on an outlook of an interest rate hike by a hawkish Federal Reserve this coming December; and even though consumer sentiment and retail sales may have disappointed dollar bulls, these reports will at best only offer a retrace in the Dollar Index to the 12,050 level. AUD/USD With a Hawkish outlook on the FED in December, the disappointing Consumer Sentiment will at best provide a short lived rally to 0.7640 until the bears take control pushing this pair down to its 89-EMA. Trade: Entry to Buy @ 0.7610 with T/P @ 0.7640 and S/L @ 0.7595 NZD/USD With continued dollar strength and the Kiwi’s weakness on the decline of the dairy auction price, the pair on the weak consumer sentiment data may offer a retracement to the 0.7200 level before commencing the sell-off to test the 0.7000 psychological support level. Tr...