25 January
Weekly Trend direction: Bearish
Weekly trend reversal level: 1.4414
Key G7 resistance levels: 1.4240/65, 1.4300, 1.4370
Counter-trend opportunities:
Strategy: Whilst below the weekly trend reversal level sell rallies to resistance levels after an entry signal.
Today's trade suggestion:
A good thing I stayed out of the market on Friday, as the currencies experienced “typical” Friday volatility and unpredictability. The reversal we experienced earlier in the week (after the weekly support level was broken)
served well to keep us out of further long trades and we are now able to re-evaluate at the start of this week. It’s a little tricky. The direction this week is firmly short, but we are at a major 38.2% Fibonacci support level which should provoke a sharp bounce. It’s best to wait for a bigger rally before selling, with a key resistance level in the 1.4240/65 level. Watch and wait for a clear G7 reversal pattern before selling into this level, with tight stops above the reversal pattern. Initial target should be around 1.4160 (the 25% Fibonacci level today)
Summary:
Look to sell into the 1.4240/65 level, stops above the reversal level, target 1.4160
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