The British Pound is not very big at the moment

Hello, fellow traders! I hope we have all had a lucrative week so far.

The FX market started the week with a big bang. This is especially true for GBP / USD, which deviated lower and traded lower throughout the day. The current price is about 118 pips below Friday’s close.

It’s no secret that the pound is currently one of the weakest major currencies. Today, I played the pound on the short side, most of which traded during the day. I sold GBP / USD, GBP / CHF, GBP / JPY, GBP / CAD and bought EUR / GBP. I still hold two positions, but the others have already reached their goal. Trading isn’t always that easy, but when it comes to easy money, we need to seize the opportunity.

So we know the pound is currently beating. This weakness is likely to continue next week, even if we encounter some sort of reinstatement. Of course, the US dollar is currently not necessarily the best currency against the pound. The Australian dollar was much stronger today than the US dollar. Many other currencies also exchanged higher exchange rates against the Buck today, including the Euro and the Japanese Yen.

This setback was really aggressive. Just look at the sharp angle of this last leg. I don’t like to chase the price of an instrument when it’s already in an exaggerated or exaggerated state. It is usually better to expect a retraction to the exponential moving average of 20, for example. You can also use role redemption levels or swing levels to find good levels to sell.

An example of a role switching level is when the exchange rate breaks through a previous support zone, after which the same zone becomes a resistance zone.

The figure above shows that the red circle indicates an area where we might find good opportunities to sell GBP / USD.

USD / CAD – where is this crazy couple going?

As I mentioned in an earlier article, I have a suspicious suspicion that this couple may soon be involved in some kind of behavior. The last three days of candles show signs of soft support. Let me enlarge this table a little to see these candles in more detail:

As you can see, all three candles have a downward wick that tells us there were buyers who defended this zone. I call this particular support area of ​​this chart a “soft support zone” because these candles are relatively small and perhaps this is not the most perfect setting for long entries. However, we could play well if we wait for a proper entrance signal, such as the last day’s candle breaking, or something like that.

Perhaps the couple will build a solid support base in this area in the coming days, which could reinforce the bullish game case and provide a safer environment for prospective buyers to trade.

AUD / USD – The Australian Dollar is NOT withdrawing

The Australian dollar has been a tough opponent in recent days. I am reminded of the lizards that live in the river where I live (Pretoria, South Africa). Sometimes the big dogs in the area try to hunt down these tough guys to eventually beat them.

If you read my previous article, you may remember that I cautioned me to join the couple too early. We haven’t come across a proper sales signal yet, but maybe one might appear these days.

I want some long, upward-running wick to appear on the daily graph, or possibly a bearish flood bar.

It seems that the market may not show much respect for this level of role change and that there may be a deeper-than-expected correction on the cards in the coming days. I assume this may also depend on the Australian retail sales number, which will be released in a few hours (Tuesday) at 00:30 (GMT). This could move Austria, so beware of the risks (and possible rewards).