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‘Risk On’ Reignited, US Stimulus ‘About There’

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Scan Of The Markets

To see an expanded version, right-click and select ‘open link in new tab‘. The indices show the performance of a currency vs a G8 FX basket. 

A wave of renewed risk appetite returned through the US session as US stimulus hopes were re-inflated after US House Representative Pelosi stated “we’re just about there”. The news lifted the likes of US equities as well as commodity-linked currencies.

It’s also important to highlight that the right sound bites via Pelosi were endorsed via a handful of republican senators. There is a growing wave of Republicans ready to pass an estimated $2 trillion + package, which makes the odds of a fiscal deal finally inked out higher even ahead of the election which happens to be just 12 days away.

All eyes will now be on the final Presidential debate between Trump and Biden before the Nov 4 election. A Democratic Clean Sweep looks increasingly likely judging by polls conducted by the main players, including FiveThirtyEight, projecting the chances at 72%.

This Friday is set to be quite a volatile one in the markets, not just ignited by the reaction to the latest Presidential debate, but due to the plethora of fundamental events lining up, including NZ CPI (just out with a soft reading), UK Retail Sales and PMIs for EU/UK/US.

In terms of the hot trade of the day, the recovery in risk appetite was well telegraphed through the reinvigoration of the CAD/JPY through Europe. The eventual follow through in the bullish price delivery was identified through the OFA script, which served as a reinforcement of the TT or Trap Pattern that also formed around the key support.

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Hot Trade Of The Day

To see an expanded version, right-click and select ‘open link in new tab‘. 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. My video analysis below will further elaborate on the logic behind the trade.   

Insights – Hot Trade Of The Day

In this video analysis I dissect the information above. Ultimately, it is the traders’ call, via a set of entries thoroughly backtested, to enter and manage a position, hence the video is intended as educational in nature and not financial advice. 

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Recent Economic Indicators & Events Ahead

 

Source: Forexfactory

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!

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

About the author

Ivan Delgado

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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