Financial Markets Online > Weekly Analysis > Our top 3 trading opportunities of the week

This week we have picked our top trading opportunities of the week, looking at DXY, EURUSD & USDCAD

DXY

  • Sellers pushed price down to the Daily 200 SMA and Monthly S2 Pivot as highlighted in last week’s analysis before pulling back into Daily Phase 2.
  • Higher revisions in US retails sales data on Friday sent price flying up which was also mixed in with the usual Friday profit taking.
  • There have been talks about the Fed cutting rates soon because of weaker US data coming out recently but the revisions last weak could delay this decision. Even without the revisions, I didn’t think there was a rate cute on the horizon unless we consistently kept seeing miss on data expectations over the next few weeks.
  • There is currently no trend on the daily chart and for price to revert into a downtrend and make the lower high, I would like to see a stall in buying in the blue zone quite early this week and signs of a reversal pattern on a smaller time frame. If buyers continue to strongly push higher then this will put me off from selling dollar.
  • IF the conditions (mentioned in the point above) are met, then look to sell dollar with the targets 3 and 4 marked on the chart.
  • There is a possibility for price to push higher and towards the upper daily channel as we have seen it done multiple times before, following a bounce off the Daily 200 SMA.

 

EURUSD

  • Buyers failed to push up to the Daily 200 SMA and sellers came in very quickly on Friday following the US data release.
  • Price is technically in an uptrend and for it continue with the trend, I would like to see buyers come in very quickly around the Monthly Pivot level.
  • Should a reversal happen then aim for Target 3 marked on the chart. Any push towards Target 4 would include another Phase 2.
  • A continuation of selling this week will put me off from buying EUR. The selling last week is a lot stronger than I would have liked to have seen for a Daily Phase 2.

 

USDCAD

  • Price briefly moved below the Daily 200 SMA before reverting into Phase 2.
  • Interestingly, a large number of Specs were caught on the wrong side of the market going long CAD very late (67% change) and getting squeezed out. The US retails sales data on Friday also pushed price higher and back within the daily range area.
  • The move higher is a lot stronger than I would like to have seen. I would be more comfortable going short if I see sellers come in very quickly in the blue zone. Target area for a sell is 1.3110.
  • Similar to the Dollar index, we have seen price push back to the top of the weekly channel after a bounce of the Daily 200 SMA. So, if buyers continue to push higher than this would be the area to target.

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