Stocks On Fire Yet USD Bounce Continues
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Stocks On Fire Yet USD Bounce Continues

Authored by 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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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. 

Despite the follow-through demand in US stocks, the USD found further short-covering to track closely the two best performing currencies on Wednesday, which include the Kiwi and Loonie. On the flip side, the Aussie and the Euro were the worst performers.

The strength in the USD, combined with the weakness in the mighty AUD or GBP, leaves us with a watchlist of trending markets shrinking yet still at healthy levels overall, mainly as a result of the recent fortitude the Pound, the Kiwi and stocks have shown.

In the fundamental domain, the US ADP Employment report came surprisingly weak ahead of Friday’s NFP. The Fed’s Beige Book noted a pick-up in activity in most regions. Meanwhile, in politics, House Speaker Nancy Pelosi reported “serious differences” still remain in place with regards to a new fiscal support package.

It’s also worth noting that the disparity in performance between the AUD and the NZD in the last 24h originates from fundamental news. On one hand, the Australian Q2 GDP saw a fall by 7% Q/Q, while the NZD surge came courtesy of the remarks made by RBNZ Governor Adrian Orr, who said that the exchange rate was behaving as one would expect and was not a concern to consider to adjust policies.

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Trending Markets On My Radar

In this section, I short-list the markets that meet the criteria, or are about, in order to engage on a directional trend off higher timeframes through a 15m chart entry. To get a deeper dive into the markets included in this section, watch my daily video.

This selection is done after analyzing markets through key metrics (Fractals and SMT) in different timeframes (4h and daily). A video on the power of the SMT can be found here “How To Trade Forex Trends Like A Pro“. The video “Fractals + SMT: The Multi-timeframe Functionality” is also a Must-Watch to fully grasp this style of analysis. 


Insights Into Market Studies

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