CAD, NZD, USD, JPY and of course S&P500. Real trades and many opportunities

CAD, NZD, USD, JPY and of course S&P500. Real trades and many opportunities

There was no short signal given for the Dollar index. The setup, discussed in the previous weekly piece “Corn, Dollar Index and a potential spearhead model in SP500. 09/22/2019” still exists but we should wait for a few trading sessions for a potential signal to appear.

CANADIAN DOLLAR

In unison with Dollar Index's analysis, a signal appeared and I've opened a position in Canadian Dollar. As you can see from the chart below. 

Canadian Dollar analysis 09/29/2019

Currently, there is a small profit. 

Friday's range is the key to the future development of this trade. My stop should have been below Friday's low but I am giving the market a little more room to play around. The reason for this is the liquidity around that low. It can go there and quickly rebound to the upside. 

A move toward Friday's high can expect on Monday. Breaking above that high will most probably drive the price to the target. If it takes the low first, all will depend on the remaining strength. If the market looks weak (based on a few strength-showing indicators) I'll take the loss.

JAPANESE YEN

Look at the chart below. It shows that the Japanese Yen is being accumulated. Price is making equal lows while On Balance Volume is making higher lows. The seasonal pattern suggests that we can expect an up move till the middle of October.

Japanese Yen analysis 09/29/2019

What I don't like is the price action from the last days. Many technical analysts will call it a pin bar but trading the Friday's high is a weak signal. Also, my price action techniques suggest that the next signal should be a composite one. Which means we should wait for at least one more daily bar which ideally will strengthen the signal. 

NEW ZEALAND DOLLAR

Now that is very interesting. A trading lesson. Being a short-term trader means that on some special occasions you have to be prepared to play both directions. 

Why? With NZD it happens because of the downtrend and a strong bullish setup which is building right now. That is not something new but put it in combination with low volatility of the last days (double inside day). What we have is a squeezed market waiting to explode.

Both directions can't be equally probable. If I have to pick only one I'll stay with the trend. 

What I'll do here is to wait for a false breakout. First, a break above or below the Friday's range should appear. Then if the market returns and takes the opposite side of the same range will make my platform scream “Take the trade, take the trade”

STOCK MARKET


Trade war, inverted yield curve, impeachment and thousands of tweets not an easy market to trade, huh?

But let's focus on facts. We are at a cyclical low. A seasonal low is approaching (middle of October). The data still shows that we have more time until the next recession.

S&P500 analysis 09/29/2019


This week my COT short-term setup rang the bell for a possible long signal for S&P500 E-minis and Nasdaq. S&P500 is stronger, and that is where we should focus our attention. And last but not least market internals look very strong.

Few posts ago I suggested a new all-time high should be reached. So far the market was able to reach the previous high only. 

This week I'll be looking for a buy signal. Especially if ISM climbs back above 50.


Now, let's find your missing piece!

Vassil Banov,
Founder of Piece of Trading

Trades mentioned here are either taken or will be taken by the author if the right conditions appear. They are NOT recommendations nor any of this constitute investment advice. Please read the Risk Disclaimer

Seasonal indicators courtesy of Larry Williams, ireallytrade.com. Charts made with TradeStation®. tradestation.com

TAGS: S&P500, SPY, SPX, COT, Commitments of Traders, Canadian Dollar, Cycles, Dollar Index, USD, CAD, NZD, JPY, Real Trades

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