Market Insight Commentary – Forex – 18 May 2018

by May 18, 2018Blackstone Futures

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Good morning traders happy Friday the 18th of May 2018 and a relatively subdued day yesterday.

What we saw is that the economic calendar was rather light, nothing really market moving. I think there were two major events yesterday one being the long bonds the US long bond broke through three and a quarter percent.

Now the significance of that is that it was a major triple top from a technical perspective and obviously that affected by the equity markets as well as some of the commodities and the dollar yen. It’s got quite a strong correlation with both the bonds in the US equity market so that was the major markets and as a result, I think it’s created a little bit of opportunity in the yen.

If I look at all the other currencies gars I don’t see a lot of opportunities here. The subdued market meant there was a little bit of a drift on the dollar. Donald Trump came out to some comments a couple of comments on trade.

He labelled China has been very spoilt in the past, he labeled the EU has been unfair in the US over the last sort of two or three decades which does suggest that those trade relations will change of course that’s good news for the for the UK but the market was really undecided as to how to read that news.

So looking at today guys like I said I don’t see a lot of opportunities here I think I’d like to continue trading with the trend elsewhere so the euro dollar on the 4-hour chart as we can see I’d like to see a continuation of this move up I think 1837 here is the top as you can see this is for the most part of this week is where we found a little bit of support and resistance so on Monday and Tuesday on the way down that’s where we found some support and evertime we’ve come up that’s where we’ve found some resistance I think that’s the major level to watch today.

Cable: very similar we got what we were hoping for yesterday we got this move dad for those of you that were brave enough to take this ema crossover late last night you’d probably be about 15 trips in the money so that would have been a mass strategy to use. Something similar in the Aussie guys either like I mentioned yesterday and he’s technically it was all holding true.

Kiwi this is one that I said to you had larger trade I think it was overdone I think I missed the boat last night here it was rounded by the one o’clock in the morning it kind of would have been operating twenty-thirty bucks which in this currency is quite a big boom so I think we’ve missed it DollarCad guys I’m sitting this out for the rest of the week, and I’m sitting out for one reason one reason alone as there is NAFTA negotiations we’ve been told the Thursday was going to be released.

It wasn’t really in its entirety so what I’m afraid about is getting into a position in the dollar cad and those kinds of get released over the weekend and we get a gap like that so I’m very hesitant to try out. USDJPY yesterday on the 4-hour chart we saw this mind a little break and this was on the back of the New York position those long bonds breaking up so you can see the correlation.

If I look at my daily chart cause I’m starting to paint it’ll put up top leaders in the daily chart I can see we must have cast it because I can see a 76.0% FIB it’s on an hourly chart I would be tempted to take the EMI crossover dates started to paint now it does look attractive and so for me this would be my preferred trade today and in actual fact the only here where I see opportunity we are not too late if that makes it so that’s what my eyes looking at today.