“Buyers deserted the US Dollar overnight, as the USD traded lower across most of the major Forex currency pairs.”
Well, that’s a change of heart! Do you remember the headlines from yesterday? “USD Strength Shakes Markets” or something like that. Apparently, those were just words, which we, as Forex traders, need to filter when making trading decisions.
Speaking of the US Dollar Index, we have been trying to avoid the noise by watching this level for the last week or so. Price has been sitting within a confluence of resistance on the daily chart and yesterday’s sleepy session was all it needed to pull back.
While the red line technically isn’t a ‘gap fill’ level, it is the weekly open following the gap. The gap has been filled, but this is the first time price has come back to this level since, and was obviously a level of interest for traders.
With USD/JPY also at resistance (the chart in the embedded Tweet), rumours and innuendos on the make-up of the BoJ stimulus package to be announced at this week’s monetary policy meeting are causing price to whipsaw.
It is however always a good sign when price whipsaws between major levels, respecting them along the way. Which is exactly what we have here with the daily trend line.
Speaking of whipsaws…
???? How can they get that so wrong?? https://t.co/SIjaBBRWRm
— Dane Williams (@danewilliamsau) July 21, 2016
How this sort of stuff can happen today is so for beyond me, it’s ridiculous. It’s 2016, and what, nobody speaks Japanese? Nobody bothered to properly Google translate? How?!
Remember what we said above about noise? Lets say it again: All just day to day noise of financial media which you as Forex traders, need to be able to filter when making trading decisions.
One last headline rumour moving markets this morning is that the Bank of England’s Weale now favours immediate stimulus:
“Martin Weale has indicated that he has changed his mind and now favors an immediate stimulus for the economy, FT reports, citing an interview.”
“There’s little that BOE can do if we’re talking about having an effect by the end of the year.”
I know many of you have problems when we link to gated articles such as FT, so the quotes are from the ForexLive blog, who as always were right on top of the moves in Cable.
GBP/USD 5 minute
50 pips already during Asia, with more coming as I’m about to press publish.
That means the hourly support level is well and truly in play on both sides if you’re looking for somewhere to manage your risk around.
Just remember, once more if you missed the point above: All just day to day noise of financial media which you as Forex traders, need to be able to filter when making trading decisions.
NZD Trade Balance
USD CB Consumer Confidence
USD New Home Sales
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This is a guest post originally appeared on Vantage FX blog. Reposted with permission.