October (WK5) Forex Market Update

And the FED does it again… After the press conference on Wednesday and the postponing of the interest rate hike to (maybe?) December, the market reaction was immediate and brought extra power to the US Dollar. As usual, EUR:USD was the first victim and we could see another next to 200 pip drop after the fall last week. This meant that most pairs that were signalling a breakout to the upside against the USD 2 weeks ago are now back into the range. This is now becoming the normal picture on our charts.
On the Indices side, Europe and Asia – DAX, CAC, Nikkei, Hang Seng – stayed around the same levels after the (surprising) recovery for the last two weeks. But a bigger surprise came from the US side with the DOW and the S&P increasing their value to levels of August and NASDAQ now retesting the all time high at 4690.
On the Commodities side, Oil retested the 43 level before pulling back once again to the middle of the range now at 46 as Gold price dropped to 1145 after the test of the resistance level at 1180 mentioned last week.

Best Trades this week

  1. AUDNZD (Daily Chart) – Continuation Short – 21.10.2015 – A pullback to the moving averages was an aggressive entry for this trade following the short trend. With lower highs and lower lows price didn’t stop at the 1.0640 support level and seems to be pushing further to the downside. Currently over +2% in profit we advise on a tight protective stop…Forex Market Update October

Effects of the News Looking Forward

This week starts with the Caixin Manufacturing Index from China which might lead to some good moves on the markets as the decrease in the production is nowadays a major concern on the global economy.
By Tuesday evening, another speech from Mario Draghi should prove the week to be a fast paced one… On Wednesday we will have both ECB president and Janet Yellen speaking.
On Thursday , guess who’s speaking again? Mr. Mario Draghi. And the week shall close on the usual but not less important announcement of the Non Farm employment change from the US. This should be one of those weeks where the news will play a major role.