Weekly Analysis of the high probability opportunities for this week in Forex, Indices & Commodities.
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It won’t surprise you to know that, after last week’s slow markets, this week’s outlook look almost the same. In fact, it is the same…
Liquidity is low, volume is low, so price action hasn’t developed much in the last 7-10 days. Do we jump onto other markets to look for other opportunities because something is wrong? Nope. The word here is…. You’ve guessed it: patience.
Here’s our shortlist of opportunities for the week:
- WTI Crude Oil
This Week’s News Calendar
Going by the calendar, this week, the focus is on: GBP, CAD, USD, EUR.
There’s also the added unpredictability factor of the WEF Annual Meetings. As you can see, they last the whole week, which is unusual. Meetings like this can sometimes create surprise news releases simply by the comments of an important person or a leak of some kind. As traders, we can look at this as added risk.
News Leads the Candle Moves
A sluggish time means we look at where news could be the ‘injection’ factor we’re after. In another video, I mentioned how news plays a role in timing your setups. So it’s even more of a factor now.
Matching our shortlist with the currencies that have news, the main interest lies with pretty much all our pairs. The key here is monitoring price action right after the big news release or the following day.
The D1 candles are my favourite to create a strong case for a setup that’s in both a likely reversal or continuation. Look for new swings forming.
The Worst Pair is the Best Pair
Ironically, my least favourite pair of maybe all time – AUD/NZD – is the best looking setup this week.
Despite it being one of the slowest and choppiest and most unpredictable markets out there in forex land, it fits with the trading plan and the Buy directional bias. We want to see the level we’re at now hold and a strong push up now.
Sometimes all it takes is a bit more waiting to see a clearer picture, and that’s what’s developing here. It’s getting clearer and clearer… until the point where the market can no longer hold its poker face and makes a move – that’s when we jump in.
Notes for Your Trading Week
Again, do keep in mind the first few weeks of the year may be slow. That means the markets may not give you large swings and movements, or can be in a range for a while. Expected to be frustrated – unless you’re day trading and/or scalping. What that means to you is:
- Account for the WEF meetings producing unexpected news that might shake the markets a bit.
- If no clarity on lower timeframes, stick to the Daily picture to get a clearer view. Only when that coast is clear is it safer to think about making a move.
- Increase your patience and don’t be surprised if you end up holding trades longer.
As always, manage your risk.
Written by: Dima Mihailovich, Technical Analyst for Forex Prop News
Contact and follow Dima on Twitter: @dimafpn
Image by Photo by George Morina, on Pexels
(Please note: All comments made in this video and article are not trading or investment advice and are for education purposes only. You are responsible for your own decisions and the risk that goes with it.)