Today's trade - Looking to sell AUD/USD

Jarratt Davis

Special Consultant to the FPA
Messages
1,495
Hey Everyone,

London session trading outlook:

Originally Updated: 06:46 London time

Currency Pair: AUD/USD

Sentiment: Short term bearish

Market focus:

In today’s trade set up we will be focussing on short term selling opportunities on the AUD/USD.

Fundamentals:

We will look for AUD weakness after the RBA held rates at record lows reiterating it sees a likely period of interest rate stability and that the currency remains high by historical standards.

The USD still remains our main play with the FED moving closer to raising interest rates.

Technicals:

We have a nice confluence zone at 0.8799-0.8816. This should offer short term resistance for any pullback.

Stop loss could be placed at 0.8850

First take profit target: 0.8770

Second take profit target: 0.8700

Trade management: After target 1 hit stop loss could be moved to breakeven

P.S - If you want to learn more about how I trade, check out this link below

http://www.forexpeacearmy.com/forex...e-trading-course-forex-pro-jarratt-davis.html
 
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Jarratt Davis

Special Consultant to the FPA
Messages
1,495
Hi Jarratt,

how low could EURUSD go? what would be its fair price with all this fundamentals.

Thank you.
Hi Julius,

it's all dependent on what language ECB's Gov Draghi uses in his commentary on Thursday at 16:00gmt, the news will be delivered to this site (Central Bank News) as soon as it's released.

Bear in mind that central banks are purposefully subtle in their statements but will give clues as to what they are thinking, what we are looking for from Draghi is further negative/dovish commentary to weigh in further on Euro weakness. Now with that in mind we also have to consider that there have recently been sources from with inside the ECB stating that there is a dispute amongst some of the heads of the institution about the flawed model of their proposed ABS program, so we're also keeping an eye out for further hints that their ABS program might not be a reliable solution for the Eurozone going forward and whether it can still provide enough momentum to kick start their economy or is QE now feasibly on the horizon. So to sum up a rate rise at the moment for the EUR is not even in the picture and the market is just focussing on, how much worse is the situation going to get before it gets better.

With that in mind I fundamentally see no reason why the EUR won't keep falling especially against the USD which is the flavour of the month, any EUR rallies will be short lived and will retrace. The ultimate question is how fast is the Euro going to fall, and that's all dependent on these upcoming news events.

But basically Draghi will be as dovish as he can to get the Euro lower and keep it down, there is the potential for it to hit 1.25 is at the moment and I think it could possibly get down to 1.20 over the coming weeks to 6 months.
 
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csc2009

Recruit
Messages
836
Hi Julius,

it's all dependent on what language ECB's Gov Draghi uses in his commentary on Thursday at 16:00gmt, the news will be delivered to this site (Central Bank News) as soon as it's released.

Bear in mind that central banks are purposefully subtle in their statements but will give clues as to what they are thinking, what we are looking for from Draghi is further negative/dovish commentary to weigh in further on Euro weakness. Now with that in mind we also have to consider that there have recently been sources from with inside the ECB stating that there is a dispute amongst some of the heads of the institution about the flawed model of their proposed ABS program, so we're also keeping an eye out for further hints that their ABS program might not be a reliable solution for the Eurozone going forward and whether it can still provide enough momentum to kick start their economy or is QE now feasibly on the horizon. So to sum up a rate rise at the moment for the EUR is not even in the picture and the market is just focussing on, how much worse is the situation going to get before it gets better.

With that in mind I fundamentally see no reason why the EUR won't keep falling especially against the USD which is the flavour of the month, any EUR rallies will be short lived and will retrace. The ultimate question is how fast is the Euro going to fall, and that's all dependent on these upcoming news events.

But basically Draghi will be as dovish as he can to get the Euro lower and keep it down, there is the potential for it to hit 1.25 is at the moment and I think it could possibly get down to 1.20 over the coming weeks to 6 months.
I agree, 1.20 does seems very possible now.
 
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juliusrichmond

Private, 1st Class
Messages
37
Wow thanks for the insight and the website you gave.

Just to check here since there wouldn't be any changes in the stimulus program of BoJ for now or until Oct 31. Is it safe to say that USDJPY can only reach the level of support around 110.09. A comment was also released by Japan’s vice finance minister Nobuhide Minorikawa that "Some companies are suffering from the weaker yen", should we be concerned about this or its best to wait for further information.
 

LJH

Recruit
Messages
7
Hi Julius - I was also wondering about the disparity between the remarks from Kuroda, Abe and other ministers. I came across this today which suggests that things haven't really changed.

October 08, 2014 - reuters.com

TOKYO, Oct 8 (Reuters) - Japan's top government spokesman said on Wednesday there is no difference in views between the government and the Bank of Japan over the weak yen. "There is no difference at all," Chief Cabinet Secretary Yoshihide Suga told a news conference, clarifying remarks he made on Tuesday. He said his earlier remarks were to simply state that a weak yen JPY= has not boosted exports as the government had expected. ID:nT9N0RN00C "It is not that a weak yen is good or bad, the government will proceed with the three arrows (of economic policies) and expect firms to allocate their positive earnings to increase their capital spending, wage increase and employment improvement." Suga also said corporations are still watching the development of the global economy including a soft yen. He made comments after BOJ Governor Haruhiko Kuroda said on Tuesday that a weak yen, as a whole, has a positive effect on Japan's economy if the currency's move reflects economic and market fundamentals. He also said recent falls in yen has not caused any big problem for the economy. ID:nT9N0RN00T Prime Minister Shinzo Abe and his cabinet ministers have recently started to comment on the disadvantages of the weak yen, not only the positive impact, largely on the need as politicians to pay heed to their local constituencies. ID:nL3N0S11IF ID:nL3N0S22EG Abe has pushed his massive monetary stimulus, fiscal spending and structural reforms, dubbed three arrows of "Abenomics", which helped boost business confidence by weakening yen and lifting share prices. But some lawmakers criticize the prime minister's policy as hurting households and small firms through rising imports costs via a weak yen. (Reporting by Kaori Kaneko; Editing by Kim Coghill) ((kaori.kaneko@thomsonreuters.com; +81-3-6441-1983; Reuters Messaging: kaori.kaneko.thomsonreuters.com@reuters.net)) Keywords: JAPAN ECONOMY/SUGA
 

juliusrichmond

Private, 1st Class
Messages
37
Hi Julius - I was also wondering about the disparity between the remarks from Kuroda, Abe and other ministers. I came across this today which suggests that things haven't really changed.

October 08, 2014 - reuters.com

TOKYO, Oct 8 (Reuters) - Japan's top government spokesman said on Wednesday there is no difference in views between the government and the Bank of Japan over the weak yen. "There is no difference at all," Chief Cabinet Secretary Yoshihide Suga told a news conference, clarifying remarks he made on Tuesday. He said his earlier remarks were to simply state that a weak yen JPY= has not boosted exports as the government had expected. ID:nT9N0RN00C "It is not that a weak yen is good or bad, the government will proceed with the three arrows (of economic policies) and expect firms to allocate their positive earnings to increase their capital spending, wage increase and employment improvement." Suga also said corporations are still watching the development of the global economy including a soft yen. He made comments after BOJ Governor Haruhiko Kuroda said on Tuesday that a weak yen, as a whole, has a positive effect on Japan's economy if the currency's move reflects economic and market fundamentals. He also said recent falls in yen has not caused any big problem for the economy. ID:nT9N0RN00T Prime Minister Shinzo Abe and his cabinet ministers have recently started to comment on the disadvantages of the weak yen, not only the positive impact, largely on the need as politicians to pay heed to their local constituencies. ID:nL3N0S11IF ID:nL3N0S22EG Abe has pushed his massive monetary stimulus, fiscal spending and structural reforms, dubbed three arrows of "Abenomics", which helped boost business confidence by weakening yen and lifting share prices. But some lawmakers criticize the prime minister's policy as hurting households and small firms through rising imports costs via a weak yen. (Reporting by Kaori Kaneko; Editing by Kim Coghill) ((kaori.kaneko@thomsonreuters.com; +81-3-6441-1983; Reuters Messaging: kaori.kaneko.thomsonreuters.com@reuters.net)) Keywords: JAPAN ECONOMY/SUGA

Thank you for the information sir.
 
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