The main news of Wednesday was the US Consumer Price Index. This information ensured the investors that FRS will raise the interest rate the fourth time this year.
Consumer Prices is the core inflation index according to FRS. It was 0.1% higher than expected. 2.1% is very close to the target 2.0% – that is why investors grow more confident that the rate will be raised. For the same reason the dollar didn’t drop significantly.
In the evening Theresa May might speak about Brexit, so pay particular attention to pound pairs. The recent rumours that a breakthrough was achieved in EU Brexit talks provided support to the pound.
Euro couldn’t grow significantly due to dispute between the European Commission and Italy. The reviewed budget did not satisfy the EC, but the fact that Italy made concessions speaks volumes.
On Thursday, you should keep in mind the following news:
- 4:30 a.m. EST – UK Retail Sales statistics is published;
- 8:30 a.m. EST – US Retail Sales;
- 10 a.m., 11:30 a.m. and 1 p.m. EST – FRS representatives speak.
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You should also add the possible Theresa May Brexit speech to the list. The day is stuffed with important events, so keep your eyes open.
Potential short trades from resistance on EURUSD
Some momentum moves occurred yesterday on this pair. The price broke the swing level at 1.1315-1.1319, but later the chart rapidly pulled back under it.
Scenario for today implies the resistance break attempt and the formation of a swing level around the marked zone. The local low of the swing pattern should be around 1.1317.
You can enter a short trade after a downward break and the test of the lower margin. Place the TP at 1.1263 and place the stop above the pattern high.
Look for short trade opportunities on AUDNZD
Pattern #5 elements have already appeared. The chart went above 1.0626 (lower margin of a swing level), and we only need the price to touch the 1.0626 mark to enter a short trade.
The price has already swung, but the chart stopped a few pips away from the lower margin of the broken level – therefore, we cannot enter the short trade, but an entry may appear very soon. You should place your TP at 1.0606.
Enter short trade after an upward test of 0.7270 on AUDCHF
We see pattern #5 forming on this cross-pair. Both swing zones formed, the chart grew between them and is trending above the second swing zone.
At the moment the chart has almost reached the 0.7270 mark – it is our short entry. If the situation is identical to that on AUDNZD (with a small gap between the chart and the target), we don’t enter the market and wait until the price touches the 0.7270 mark.
You should place your take-profit at 0.7250.
Wait for a pullback to 835.1 and sell after the price touches the level on Platinum
Pattern #5 is also forming on Platinum. The chart went deep down after the break of the swing level lower margin, but swung at 830.0 and is moving towards 835.1. If the price touches the lower border of the second swing zone, then we can enter a short trade.
You can place your take-profit at 826.8. After covering 1/3 distance to the target, you should close half of your trade.
Short bias on Nasdaq
We see bearish pattern #5 on the chart. After moving below the pattern’s second swing zone, the chart trended, but so far no entry appeared. We lack the key element – the touch of the swing zone lower margin. We can enter the short trade only after the chart touches the 6828.86 mark.
If scenario triggers, we can place the TP at 6709.06 and apply the rule of Safe.
- EURNZD – closed half the trade using rule of Safe, the rest closed with a no-loss;
- USDJPY – the chart didn’t reach the resistance;
- NZDUSD – The resistance was broken, no short entry appeared;
- VALE and Citigroup – closed half the trade using the rule of Safe, the rest closed with a no-loss.
Yesterday was not very profitable, but thanks to the rule of Safe we didn’t lose anything, although some remaining trades closed with a stop. Do not be greedy and make use of partial take-profit in your trading.
Horizon X strategy includes a lot of techniques aimed at making trade as safe as possible. We study them all at our training and make professionals from novices. You can start with a free basic training by clicking the link below, leaving your e-mail and we will send you the Horizon X video lessons.
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That is all for Thursday! Share your trading results in the comments, we are grateful for your active participation.