Free Profitable Forex Newsletter
Hey! This is Philip with an update on the Forex market of the Free Profitable Forex Newsletter!
Fx Update - Staying on the sidelines for a while
The unexpected improvements in the prospects for both a Brexit deal and a US-China trade deal over the past couple of weeks were good news for markets. The newly agreed UK-EU Brexit deal led GBP and EUR higher while the improved US-China relations sent risky currencies rallying (AUD, NZD) while the JPY was sold together with other safe-haven assets.
But investors are not rushing to put their money behind these hopes on Brexit and US-China. As we’ve seen several times in the past, the high expectations ended in disappointments both on the US-China front and on Brexit, so patience here seems appropriate.
However, when the stakes are high like now, markets tend to either move rapidly or stay in ranges. In line with this, we are not recommending any specific trade idea for this week as the outlook for most currency pairs seems uncertain, given the Brexit and US-China risks.
UK Parliament Votes on Brexit Tomorrow (Saturday) - Watch out for Monday gaps on GBP pairs
Pound Sterling was on fire this week as higher probabilities for a smooth Brexit are back on the table.
Obviously, now that the UK Government and the EU leaders have agreed on a deal, the hard part comes - Passing the deal in the UK Parliament. Theresa May failed to do so several times already, and the markets are skeptical that Boris Johnson can do that on the first try.
Nonetheless, it remains to be seen what comes out of it, optimists, of course, have their hopes high. There is only one thing guaranteed out of this, and that is significant volatility on GBP pairs on the Monday open given that the Parliament vote will take place tomorrow. Gaps on the weekly open are also likely in either a rejection or approval of the deal.
Gold update: Retracement looks likely to extend lower
So, with all that said, let’s briefly take a look at Gold now. The chart there looks quite clean, and some interesting opportunities could be created once some technical zones are broken.
We can see that after the breakout of the bullish channel, a new descending channel was formed that is so far defining the retracement.
Current support sits at the $1475 lows, and a bearish breakout here will open the way toward $1440 and lower (support trendline of the channel). Resistance is clearly at the falling trendline around the $1500 round number, and a bullish breakout there could open the way toward the $1550 highs again.
These technical levels are shown on the chart below:
Another leg lower looks likely as per the short-term fundamentals and sentiment, especially with all the positive developments on Brexit and US-China. However, do note that in case of disappointments here, Gold will get a bullish push (likely a breakout above $1500 as discussed in the technicals above).
Additionally, there are new geopolitical risks with the Turkish offensive against Syrian Kurds. The western world, including the USA, seem to be unhappy with Turkey’s move, so this front is another thing to watch when trading safe-haven assets.
Longer-term, the bullish trend looks to have more fuel in the tank and could take Gold prices above the yearly highs. Central banks have reverted to printing money to support their weakening economies, and if this trend persists, the increase in money supply will be strongly bullish for Gold.
Trade signals from the past week
- Short EURUSD (not triggered)
TOTAL: 0 pips in the past week
TOTAL: +1995 pips profit since October 1, 2018
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Any opinions, news, research, predictions, analyses, prices or other information contained in this newsletter is provided as general market commentary and does not constitute investment advice. FX Trading Revolution will not accept liability for any loss or damage including, without limitation, to any loss of profit which may arise directly or indirectly from use of or reliance on such information.
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