Blake Morrow
Chief Currency Strategist, Wizetrade
We should keep a close eye on the USD/CNH (candle chart) and the AUD/USD (bar chart) as the weaker Yuan (CNH) is a type of “stimulus” for the Chinese economy as the Chinese government adjusts the peg and makes way for a weaker Yuan assisting exports and domestic downside pressures. In other words, the Chines government may continue to weaken the Yuan instead of direct stimulus assisting the stabilization of the Australian dollar which relies on a stronger Chinese economy.
This is an example of a triangle pattern on a 4 hour chart, we are probably within 12 hours or so of a breakout. Direction is a tough call since the longer term trend is higher, but on this chart we have been trending lower the last couple weeks. However, since the NZD has been trading relatively heavy against most currencies, there is a stronger possibility of a down move.
Breakout points are 87.70-88.15
Blake Morrow
Chief Currency Strategist, Wizetrade
Following the USD/SEK, the USD/NOK is setting up for a double bottom wedge breakout. The Nordic currencies have been weak all day as the USD posts some strength following strong US economic data this week.
Have a wonderful Easter weekend and holiday.
Blake Morrow
Chief Currency Strategist, Wizetrade
Disclaimer: I entered a long USD/NOK trade yesterday following the USD/SEK breakout.
The AUD/CAD has been setting up as a “Gartley” for the last couple months. I have kept it on the radar and I want to thank @nigelcapital for making sure I looked at it today. The confluence of the 161% extension and 78.6% retracement comes in at 1.0400 (give or take). The reaction (if we get there), and looking for a reversal pattern will be key in looking for a short entry.
Gartely patterns are great. Precise entries with calculated risk/reward. Just the way I like them. I tend to stick to the basics like the Gartley or Butterfly since I am not a “harmonic” expert by any means.
Blake Morrow
Chief Currency Strategist, Wizetrade
Disclaimer: I have no position in the AUD/CAD, but if we get to 1.0400 I may. :^)
The USD/SEK is attempting a weekly breakout (nearly 4 year trend line) above the critical 5.5600 level. RSI is breaking higher as well, confirming the SEK weakness. Just last week Sweden’s CPI registered the lowest level we have seen in years which confirms the weakness in the SEK as traders and investors fear the Riksbank may take further stimulus measures to fight deflationary pressures. .
Blake Morrow
Chief Currency Strategist, Wizetrade
Disclaimer: I am currently long the USD/SEK and intend on staying long for several days.
False breakout (upside) led to breakdown on the E-mini futures. Range extension targets will be 1790-1775 sometime into next week.
Blake Morrow
Chief Currency Strategist, Wizetrade
Disclaimer: I am short equities via an ETF
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