Scan Of The Markets
If last Friday was all about USD weakness without a fiscal stimulus deal in the US, on the first day of the new week the dominant theme was the surge in US stocks with or without Columbus Day as the Nasdaq index leads the charge into higher territory.
Surprisingly, the AUD and NZD ended as two of the worst-performing currencies with news outlets out there attributing the lackluster behavior to the recent action taken by the PBOC to limit the CNH strength. In my book, while respecting fundamentals, technicals and the psychology of flows is what I am most keen to follow, and it tells me the Aussie still looks technically very strong against the USD.
In fact, today’s trade of the day is what I envision to be a potential long setting up in the Aussie vs the US Dollar based on the read of market structures, momentum and order flow. It’s all aligning for the bulls and we just need to see the initiation of a price delivery above 0.7215/20 to reinforce this conviction for a long play in the next 24h.
Hot Trade Of The Day
In this section, I pick a market or several ones that presented an opportunity to buy on weakness or sell on strength based on the higher timeframes outlook.
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Insights – Hot Trade Of The Day
Video Length: 00:01:57
Recent Economic Indicators & Events Ahead
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Source: Forexfactory
Important Footnotes
MARKET STRUCTURES
Markets evolve in cycles followed by a period of distribution and/or accumulation. To understand the principles applied in the assessment of market structures, refer to this video. Fractal breakouts is at the epicenter to assist us in the analysis of chart structures.
MARKET MOMENTUM
In order to assess the market momentum of a particular asset, I’ve promoted for years the idea of using what I call the smart money tracker. The settings and the indicator can be obtained via our Discord room, where traders from all walks of life interact frequently. In this video I lay out the elements I look into to call trend directions.
PROJECTION TARGETS
The usefulness of the 100% projection resides in the symmetry and harmonic relationships of market cycles. By drawing a 100% projection, you can anticipate the area in the chart where some type of pause and potential reversals in price is likely to occur, due to 1. The side in control of the cycle takes profits 2. Counter-trend positions are added by contrarian players 3. These are price points where limit orders are set by market-makers. You can find out more by reading the tutorial on The Magical 100% Fibonacci Projection.
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