Ivan Delgado is a decade-long Forex Trader. Feel free to follow Ivan on Youtube. Join thousands of traders who follow Ivan's insights to increase their profitability rate by learning the ins and outs of how to read and trade financial markets. Ivan has you covered with in-depth technical market analysis to help you turn the corner.
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The indices show the performance of a particular currency vs G8 FX. A video on how to interpret these indices can be found in the Global Prime’s Research section.
We enter a new week of trading with US equities charging higher following a late rally on Friday, Gold trying to hold above the $1,800.00 mark, the Pound still an out performer in the currency space, while the USD and Yen keep heading in opposite directions.
There have been no improvements in the COVID-19 news flow over the weekend with new record infections out of Florida. However, news last Friday that Gilead’s Remdesivir treatment reduced mortality rates significantly aided the recovery in sentiment.
When it comes to forging one’s views by first defining the type of risk environment we are in, we are back to getting ambiguous and unclear reads as stocks up and the US Dollar down tell us one thing (risk on), yet the weekly performance by the Yen (2nd largest gains) or the Canadian Dollar (main loser) communicates the opposite.
The hit taken by the Canadian Dollar comes even after a positive jobs read last Friday, which the market brushed under the carpet. Canadian employment in January saw a rise of 952.9k vs 700k expected even if the unemployment rate met expectations of 12.3%. Technicals in the CAD were looking grim ahead of the release nonetheless.
Before I jump into the technicals, be reminded that unlike last week, where the economic news flow was limited, this week is a whole different ball game. We have US earnings, China Q2 growth figures and June activity, the much-awaited EU Summit, Australia’s employment report and NZ Q2 CPI in the docket.
Lastly, the market continus to turn a deaf ear and be oblivious to the fact that U.S. President Trump is in no mood to resume trade talks with China for a “Phase 2” trade as the relationship between the two contries, even to the public eye, have been severely compromised due to COVID-19 and the cover up of the virus by China.
When asked by reporters about the prospects of a ‘Phase 2’ deal, Trump said “I don’t think about it now,” adding that “many other things are in my mind now”. Trump went on to say “the relationship with China has been severely damaged. They could have stopped the plague, they could have stopped it. They didn’t stop it…”
Let’s now go through a quick summary of what really matters for the readership. That is, what markets are still in a trending phase, hence we want to be monitoring most closely and be ready to jump on the bandwagon of opportunities that may be about to emerge?
The markets that capture my interest and fit the bill where the 4h and the daily see an alignment of structures and mometum include. The S&P 500 index, GBP/USD, EUR/CAD, GBP/AUD, GBP/CAD. There are a bunch of other markets where the 4h time scale is in agreement but contradictions exist when crosschecked vs the daily.
As usual, in the video below is where I lay out all my thoughts for the day ahead, always taking aim to identify the markets with the conditions most ripe to engage in trend trading. Calling ranges when we should is also critically important to stay away from noisier prospects. I too look to incorporate intermarket to find divergences.
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This analysis is conducted on a multi timeframe dimension. Ultimately, it is the traders’ call, via a set of entries thoroughly backtested, to enter a position, hence the video is mainly intended as a way to educate traders in upping their analytical skills.
If interested in the best ‘free of charge’ News Indicator that displays data on past and future news in the Forex market via MT4, check this YouTube video I produced. The indicator allows you to save time, avoid mistakes. It’s spot on!
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 the tutorial How To Read Market Structures In Forex.
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.
Unlike levels of dynamic support or resistance or more subjective measurements such as fibonacci retracements, pivot points, trendlines, or other forms of reactive areas, horizontal areas of support and resistance are universal concepts used by the majority of market participants. It, therefore, makes the areas the most widely followed. The Ultimate Guide To Identify Areas Of High Interest.
It’s important to highlight that the daily market outlook provided in this report is subject to the impact of the fundamental news. Any unexpected news may cause the price to behave erratically in the short term. Monitor the event risks via Forexfactory.com & refer to Fundamentals vs Technicals In Forex.
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