The positions below represent the institutional positions held as of September 4, 2018!
Last week’s price action has shifted the bias somewhat as there starts to accumulate evidence that the #dollar might start getting stronger in the coming weeks. It all started with the breakdown of the monthly and weekly demand zones on the $audusd. Now we’ve know that the likelihood of the $audusd dropping was high but there existed at one time the possibility that the tested monthly demand could have brought in a move upwards, considering the situation with the #usdollar, but now that the monthly demand has been taken out we have to respect that and consider that this move could be foreshadowing a move higher on the #dollar. When trying to determine the likelihood of this happening we also must look at the other pairs to determine a case for this and what I am finding is indeed there can be a strong argument built on a stronger #dollar taking place sooner rather than later. So let’s examine why.
When we look at the $nzdusd we can see there is nothing to stop price from dropping from here one, when we examine the #dollar pairs ($usdcad, $usdjpy and $usdchf) we can see signs pointing toward a strong dollar with momentum shifts taking place and weekly demand about to come into contact on the Franc. These signs must be respected because they are happening for a reason. It may be a bit too early to put the direction in stone but we must be aware that this is happening going into this week.
In terms of signals being presented, there is a good chance that the $audusd will present a short signal this week and when examining the forces and momentum in play a short is exactly what we want to be looking for. This chart is ideal for a short and the conditions should be noted and remembered so that you will recognize what makes a trade work well. Also watching the $gbp pairs for potential long signals to present themselves.
Very tough markets out there currently but hopefully things will become clearer soon. Have a safe one out there traders; hope this report is helpful to your trading!
Magic Trader