FX Trading Ideas for the Week | Jan 21 - 25, 2019

By Aiza Belle | 22 January 2019 | | Share:

A foggy start of the week -- or more like calm before the storm.

With the possibility of the stock market getting ready to plunge some more instead of already bottoming out:

If it breaks the 2800-2900 high, then it has already bottomed. Else it will go crashing down to 2100 between now and early Q2 2019.

Not to mention the slowdown in overall global economic growth, and labor issues related to AI, right now it kinda feels like the 2000-era dot-com bubble once more.

But contrary to zerohedge's pessimism (since when did he become optimistic though?), I still have a general positive outlook in the global economy with AI and machine learning just in the early stages now. Both have the potential to boost productivity and elevate humanity -- if used properly, the way Sweden and Elon Musk want it to be, not Zuckerberg's way).



Elon Musk is correct here, considering the Dyn attack last October 2016-- a massive DDOS attack using IoT devices such as security cameras and printers because these devices are still very easy to hack and add in a botnet. There was an even larger attempt in February last year, but it failed.

Anyway my point is, if PCs and IoT devices aren't secure and even small US missiles easily hacked, AI robots are even more dangerous.

Back to trading.

Market is slowly going back to action after yesterday's US bank holiday (Martin Luther Day), China's GDP news (same as forecast) and Industrial Production report, and continued ruckus in the UK.

Before you proceed, make sure to read and understand this Disclaimer here and TRADE AT YOUR OWN RISK.

I. FX Trading Ideas for the Week

AUD - Buy

Despite expectations that China's economic growth will slow down further after Chinese data yesterday (GDP at 6.4%) and divergent outlook on yuan by fund managers and fellow traders, still riding the recent sharp appreciation on it along with positive economic news in China, which still makes me a bit bullish on AUD. However, more caution is needed for any increased volatility and sudden reversal, especially most AUD pairs are reaching key resistance areas in the daily and weekly charts.

AUDCAD - Wait near 0.95, buy stop @0.953
AUDCHF - Wait near 0.71, or wait for breakout past 0.72 then buy with target profit @0.735
AUDJPY - Wait for bearish continuation past 77.743 and short with target profit near 77
AUDNZD - Wait near 1.065
AUDUSD - Wait for confirmed bounce from 0.713 then buy with target profit near 0.72
EURAUD - Wait near 1.595
GBPAUD - Wait near 1.805 

CAD - Buy

Though CAD pairs are more likely to continue going ranging, will just ride the short-term consolidation with US drilling slowing down recently. But overall I'm still bullish in CAD especially with oil prices recovering bit by bit with US Sanctions on Iran making a comeback, and the BoC being hawkish in general. 

CADCHF - Wait near 0.75
CADJPY - Wait near 82
EURCAD - Wait near 1.515
GBPCAD - Wait for bullish continuation past 1.72 then buy with target profit near 1.7350
NZDCAD - Buy with target profit @0.90 - 0.90338
USDCAD - Wait for bullish continuation past 1.335 then buy with target profit @1.34 - 1.345
AUDCAD - Wait near 0.95, buy stop @0.953

CHF - Wait

Though I actually have a bullish bias on CHF because of the general risk-off sentiment in the markets now, will ride the stronger momentum of other currencies and also wait for confirmation before entering trades in CHF pairs.

CHFJPY - Wait for bearish continuation past 109.446 then sell with target profit near 109
EURCHF - Wait near 1.134
GBPCHF - Wait near 1.285
NZDCHF - Wait near 0.67
USDCHF - Wait near 1.00
AUDCHF - Wait near 0.71, or wait for breakout past 0.72 then buy with target profit @0.735
CADCHF - Wait near 0.75

EUR - Wait

Most EUR pairs have been consolidating recently. Might ride that in the short-run if I see a good entry and risk-reward ratio for the day, else best to wait in the sidelines especially with ECB meeting and PMI news happening this Thursday.

EURGBP - Wait for bullish confirmation past 0.887 then buy with target near 0.90
EURJPY - Wait for bearish confirmation past 124 then sell with target near 123
EURNZD - Wait near 1.69
EURUSD - Wait near 1.35
EURAUD - Wait near 1.595
EURCAD - Wait near 1.515
EURCHF - Wait near 1.134

GBP - Buy (short-term)

Riding the recent recovery on GBP after the Parliament voted against PM May's Brexit plan, and some rumors that the EU will actually allow further extension instead of forcing the UK to a no-deal Brexit, considering the political turmoil happening in the UK now (PM May survived the confidence in government vote despite losing in the Parliament vote, which now gives way to her Plan B). I personally feel bad for her despite being a Bremain myself. I just hate the fact that women are given power just to be used as scapegoats, but I shouldn't express my other opinions here and just focus on trading (sorry haha).

GBPJPY - Wait for bearish confirmation past 140.58 then sell with target profit @139.5
GBPNZD - Wait near 1.922
GBPUSD - Wait for bullish continuation past 1.293 then buy with target profit near 1.30
EURGBP - Wait for bullish confirmation past 0.887 then buy with target near 0.90
GBPAUD - Wait near 1.805 
GBPCAD - Wait for bullish continuation past 1.72 then buy with target profit near 1.7350
GBPCHF - Wait near 1.285

NZD - Wait

Best to wait in the sidelines until CPI news is out early morning tomorrow. I generally have a bullish outlook on the Kiwi and believe it will continue to follow the Aussie dollar's performance, but we'll see if NZD pairs will breakout from their range soon.

NZDJPY - Wait near 73.5
NZDUSD - Wait for confirmed bounce from 0.67 then buy with target profit near 0.68
AUDNZD - Wait near 1.065
EURNZD - Wait near 1.69
GBPNZD - Wait near 1.922
NZDCAD - Buy with target profit @0.90 - 0.90338
NZDCHF - Wait near 0.67

JPY - Buy

The current risk-off sentiment in the market continues to support risk haven currencies. Though that isn't pronounced in CHF because it's affected by risks in the Euro zone, JPY proves that correlation by appreciating recently like the Chinese yuan. Still need to be cautious of upcoming BoJ meeting tomorrow though even if it's already expected that rates will remain unchanged at -0.10%.

USDJPY - Wait near 109.5
AUDJPY - Wait for bearish continuation past 77.743 and short with target profit near 77
CADJPY - Wait near 82
CHFJPY - Wait for bearish continuation past 109.446 then sell with target profit near 109
EURJPY - Wait for bearish confirmation past 124 then sell with target near 123
GBPJPY - Wait for bearish confirmation past 140.58 then sell with target profit @139.5
NZDJPY - Wait near 73.5

USD - Buy (short-term)

With US government shutdown still ongoing but already priced in like the hakwish Fed, and manufacturing index data better than forecast last week, I'm slightly bullish on USD in general - at least until I see a confirmed reversal between 98 - 100 in the DXY.

AUDUSD - Wait for confirmed bounce from 0.713 then buy with target profit near 0.72
EURUSD - Wait near 1.35
GBPUSD - Wait for bullish continuation past 1.293 then buy with target profit near 1.30
NZDUSD - Wait for confirmed bounce from 0.67 then buy with target profit near 0.68
USDCAD - Wait for bullish continuation past 1.335 then buy with target profit @1.34 - 1.345
USDCHF - Wait near 1.00
USDJPY - Wait near 109.5
XAUUSD - Wait for bearish continuation past 1276 then sell with target profit @1260
XAGUSD - Wait near 15.33
XTIUSD - Wait for possible bounce from 52
USDZAR - Wait near 13.95
USDMXN - Buy stop @19.25 with target profit @19.50

Feature photo from Paul G. of Unsplash