Forex Relative Strength Analysis Report For Week Starting 8/11/19

Some of the world’s currencies are accepted for most international transactions. The most popular currencies are accepted for most international transactions are the U.S. dollar, the euro, and the yen. However, the U.S. dollar is the most popular.

And in the foreign exchange market 90 of forex trading involves the U.S. dollar. Thus, when assessing the relative strength of the most popular currencies in the world, it’s always against the U.S. dollar, using the dailytime frame chart.

The “major” forex currency pairs are the major countries that are paired with the U.S. dollar (the nicknames of the majors are in parenthesis).

AUD/USD – Australia dollar (Aussie) vs. the U.S. dollar

EUR/USD – Euro vs. the U.S. dollar

GBP/USD – British pound (Sterling or Cable) vs. the U.S. dollar

NZD/USD – New Zealand dollar (Kiwi) vs. the U.S. dollar

USD/CAD – U.S. dollar vs. the Canadian dollar (Loonie)

USD/CHF – U.S. dollar vs. the Swiss franc (Swissie)

USD/JPY – U.S. dollar vs. the Japanese yen (the Yen)

Based on the moving averages and the last daily closing price, relative to the moving averages,

the currency relative strength relative to the US dollar is the following:

Two Weeks Ago

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

Currency Analysis Report 8/9/19 – The Kiwi Got Squashed

The New Zealand dollar is known in the forex world after its national icon, the flightless bird called the Kiwi, which is also pictured on the country’s $1 coin.

Image result for new zealand $1 coin

The Kiwi remains under pressure as lingering U.S.-China trade tensions continue to weigh on sentiment.  The Reserve Bank of New Zealand has already cut interests rate twice this year and Bearish traders were betting on another ¼ point cut this earlier this week. But the news that came out this week, even shock the Bears.

The New Zealand Dollar was crushed Wednesday after the Reserve Bank of New Zealand (RBNZ) slashed its interest rate further than markets expected and gave guidance that was more ‘dovish’ than anticipated, but analysts say there’s more losses ahead because the bank is likely to cut again before long.

The Reserve Bank of New Zealand cut its interest rate by 50 basis points to a new record low of 1.25% Wednesday when financial markets had looked for only a 25 basis point reduction, taking the market by surprise and prompting traders to dump the Kiwi currency by the bucketload.

Image result for Reserve Bank Governor Adrian Orr

Reserve Bank Governor Adrian Orr hinted at further easing by any means necessary in order to hit their inflation rate targets.   Based on where I think the global economy is headed over the coming 12-24 months, I’m personally bearish as well on the Kiwi.

On the monthly chart, there is a nice head and shoulder pattern.

So based on a measured move, price could go sub .5000, which is an extreme.

So I will settle for distance that is half the measured move, but at the moment, on a smaller time frame, I can find a level to enter to go short.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

Currency Analysis Report 8-5-19…The Thailand Baht Is Doing Very Well

The foreign exchange market is where currencies are traded. When investors trade foreign exchange (forex or FX for short) they’re buying and selling currencies over the foreign exchange market.

The forex market is the largest and most traded financial market in the world. The forex market has grown to a daily trade volume of over $5 trillion a day which is over 200 times bigger than the New York Stock Exchange.

I try to stick to the major currencies and the minor currencies. The majors are the currencies of the major global economies – the US, Japan, UK, Euro Zone, Canada, Australia, Switzerland and New Zealand and stay away from the exotic currencies because they are a lot less liquid and prone to “slippage” and it also means they have wider spreads than the majors and the crosses.  However, I at least pay attention to them…at least from a distance.

The Thailand currency is call the Baht.  And as strong as the US dollar has been against all the major currencies this year, I was shock to read that the Baht has been outperforming the US dollar this year (+5%) and year over year (+8).

But this isn’t necessary good for the Thailand as their exports have become more expensive and so will ultimately hurt their economy.  This is why Trump has been fighting with China for the last 1.5 years.  Our trade balance with China is so lopsided as a result of China continuing to depreciate their currency whenever it suits their best interests.

Anyway, back to the Baht, is there any hope for the country of Thailand in regards to a cheaper Baht, lets go to the charts to find out?

Monthly Chart (Curve Time Frame) – monthly supply is at 35.750 and monthly demand is at 29.000.

Weekly Chart (Trend Time Frame) – the trend is down.

Daily Chart (Entry Time Frame) – the chart suggests to short price on a pull back to the daily supply at 31.350 with a target just above the top the of the monthly zone.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

Forex $1 MM Challenge (8/4/19) – Recent Japanese Yen Trades

Safe havens currencies retain or increase in value during risk off environments, meaning when economic turbulence is upon us. Three major safe haven currencies are the U.S. dollar, the Japanese Yen and the Swiss Franc.  In the past several months we have witnessed a divergence in the equity markets.  While all major equity markets around the world are doing down, the US market is the only one holding on for dear life. So in a risk off environment commodity type currencies decline in price as a result.

On July 1st I when short two different Japanese forex pairs.

Forex $1 MM Challenge – Trade #16 (7-1-19) Sold USD/JPY

Monthly Chart (Curve Time Frame) – monthly supply is at 121.00 and monthly demand is at 97.000.

Daily Chart (Entry Time Frame) – the chart suggests to go short at the daily supply at 108.60.

NOW – Price stopped me out before pushing lower this past week.

Forex $1 MM Challenge – Trade #17 (7-1-19) Sold CAD/JPY

Monthly Chart (Curve Time Frame) – monthly supply is at 0.05600 and monthly demand is at 0.04600.

Daily Chart (Entry Time Frame) – the chart suggests to short price at the daily supply at 78.000.

NOW – this trade is still in play at this time.

Both trade set-ups were a Reward to Risk of 5:1. So although I was stopped out on the USD/JPY, if the CAD/JPY ends up hitting my target, my account will go up 4%.

The game of trading is a probability game, which you most trades have less than a .500 batting avg (win/loss ratio). However, as long as your avg win is greater than your avg loss, your equity curve should be positive. Let me illustrate, if my avg. win is 3X my avg. loss, all I need is a minimum win % of 25% to be profitable. And if your avg. win was 20X your avg loss, you only have to be right 5% of the time. This is why I stopped sweating my losses years ago because my losses lead to my wins. Until next time.

My Journey Into Forex – Part 3 of 3 (The $1 MM Challenge) – Part 2

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

Forex Relative Strength Analysis Report For Week Starting 8/4/19

Some of the world’s currencies are accepted for most international transactions. The most popular currencies are accepted for most international transactions are the U.S. dollar, the euro, and the yen. However, the U.S. dollar is the most popular.

And in the foreign exchange market 90 of forex trading involves the U.S. dollar. Thus, when assessing the relative strength of the most popular currencies in the world, it’s always against the U.S. dollar, using the dailytime frame chart.

The “major” forex currency pairs are the major countries that are paired with the U.S. dollar (the nicknames of the majors are in parenthesis).

AUD/USD – Australia dollar (Aussie) vs. the U.S. dollar

EUR/USD – Euro vs. the U.S. dollar

GBP/USD – British pound (Sterling or Cable) vs. the U.S. dollar

NZD/USD – New Zealand dollar (Kiwi) vs. the U.S. dollar

USD/CAD – U.S. dollar vs. the Canadian dollar (Loonie)

USD/CHF – U.S. dollar vs. the Swiss franc (Swissie)

USD/JPY – U.S. dollar vs. the Japanese yen (the Yen)

Based on the moving averages and the last daily closing price, relative to the moving averages,

the currency relative strength relative to the US dollar is the following:

Two Weeks Ago

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

Forex $1 MM Challenge (7/29/19) – Recent British Pound Trades

The pound is the major talking point as we begin the new week as the currency falls to fresh 28-month lows amid increasing chatter of a no-deal Brexit by Boris Johnson’s ‘dream team’ since the weekend.

Gove got things started by saying that the government is now operating under the assumption of a no-deal outcome and Raab kicked things into overdrive by pointing the finger to European leaders, thus turbo-charging the pound’s decline.

Source

The British Pound has been bearish since mid-March and although price is near higher time frame demand zones, in recent days I shorted two pound pairs on pull backs. Because price is near higher time frame demand levels, my targets are what I consider pretty tight.

Forex $1 MM Challenge – Trade #18 (7-25-19) Sold GBP/CHF

Monthly Chart (Curve Time Frame) – monthly supply is at 1.47000 and monthly demand is at 1.22000.

Daily Chart (Entry Time Frame) – although price is in higher time frame demand, the chart suggests price can move lower and to short price at the daily demand at 1.23900.

NOW

Forex $1 MM Challenge – Trade #18 (7-19-19) Sold GBP/CAD

Monthly Chart (Curve Time Frame) – monthly supply is at 1.90000 and monthly demand is at 1.58000.

Daily Chart (Entry Time Frame) – the chart suggests to short price at the daily supply at 1.64000.

NOW

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

Forex Relative Strength Analysis Report For Week Starting 7/28/19

Some of the world’s currencies are accepted for most international transactions. The most popular currencies are accepted for most international transactions are the U.S. dollar, the euro, and the yen. However, the U.S. dollar is the most popular.

And in the foreign exchange market 90 of forex trading involves the U.S. dollar. Thus, when assessing the relative strength of the most popular currencies in the world, it’s always against the U.S. dollar, using the dailytime frame chart.

The “major” forex currency pairs are the major countries that are paired with the U.S. dollar (the nicknames of the majors are in parenthesis).

AUD/USD – Australia dollar (Aussie) vs. the U.S. dollar

EUR/USD – Euro vs. the U.S. dollar

GBP/USD – British pound (Sterling or Cable) vs. the U.S. dollar

NZD/USD – New Zealand dollar (Kiwi) vs. the U.S. dollar

USD/CAD – U.S. dollar vs. the Canadian dollar (Loonie)

USD/CHF – U.S. dollar vs. the Swiss franc (Swissie)

USD/JPY – U.S. dollar vs. the Japanese yen (the Yen)

Based on the moving averages and the last daily closing price, relative to the moving averages,

the currency relative strength relative to the US dollar is the following:

Two Weeks Ago

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

Currency Analysis Report 7/27/19 – Can The British Pound Rise To 1.30000???

Two years ago, England voted to leave the EU. Today, U.K. Prime Minister Theresa May asked Parliament to approve the withdrawal agreement with the European Union.  In March, U.K. Prime Minister Theresa May asked Parliament to approve the withdrawal agreement with the European Union. The withdrawal agreement was rejected by 432 votes to 202. The 230 vote defeat is thought to be the largest in U.K. political history.  Because she couldn’t get the job done, she resigned.

Now it’s newly elected leader of the Conservative party Boris Johnson takes over as the Prime Minister with the goal of executing Brexit.

Johnson, who won the race to the lead country on Tuesday, previously said the U.K. must leave the European Union by Oct. 31 “do or die, come what may.”

“Being a prime minister, things can change, and so maybe we also think about a little bit of an extension to the Brexit negotiation,” Dominic Schnider, head for commodities and Asia Pacific foreign exchange at UBS Global Wealth Management, told CNBC’s “Squawk Box.”

Should Johnson soften his perspective on Brexit, there will be consequences for the British pound, Schnider projected.

“If the market realizes that the hard Brexit probability starts to shrink, I think the pound can come back. So we’re probably going to trade north of $1.30, $1.35, somewhere there,” Schnider said.

Source

The reason the British Pound has been beaten up the last couple of years is due to the uncertainty of Brexit and if Brexit happens, the ramifications it will have on England’s economy.  However, if Brexit doesn’t happen, Dominic Schnider is right, the Pound should rise.  However, in order for it to rise to his target of $1.30, $1.35, the first major test would be the major support/resistance at 1.27000.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

Forex $1 MM Challenge – Trade #18 (7-25-19) Sold GBP/CHF

Boris Johnson took over from Theresa May as Prime Minister and it appears markets will be wanting fresh information as to Johnson’s intended Brexit policy before pushing an already heavily-discounted currency any lower.

Indeed, a number of analysts are telling us the current recovery in Sterling is actually technical in nature, without any real substantive underpinning, we therefore wonder just how high the recovery can actually go.

“We think this is simply a short covering bounce in an otherwise pronounced downtrend,” adds Bregar. “UK politics will feature some pomp and circumstance today as Theresa May resigns to the Queen and Boris Johnson is formally asked by her majesty to form a new government. Next up for GBP traders will be Boris Johnson’s new cabinet minister selections.”

Source

The Franc safe haven status outweighs the negative interest rates given the stability of the Swiss government and its financial system. Thus, when the global markets turn down, the Swiss franc tends to appreciate.

Monthly Chart (Curve Time Frame) – monthly supply is at 1.47000 and monthly demand is at 1.22000.

Weekly Chart (Trend Time Frame) – the trend is sideways with a downside bias.

Daily Chart (Entry Time Frame) – although price is in higher time frame demand, the chart suggests price can move lower and to short price at the daily demand at 1.23900.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

Currency Analysis Report 7/23/19 – I Think EUR/CHF Is Going To Parity

Swiss National Bank President Thomas Jordan is facing a new wall of pressure that could force him to push the world’s lowest central bank interest rate even lower.

The franc is already at the strongest in two years, and likely to move higher as the European Central Bank outlines plans for loosening. A dramatic shift toward parity could even prompt surprise action by Jordan before the next scheduled meeting in September. That’s something he’s not been afraid to do before, notably in 2015 with the shock decision to scrap the cap on the franc.

Source

The interests rate that the Swiss is pay in a minus 0.75%.  This means that you actually lose money if you deposit money in their banks.  However, the Franc safe haven status outweighs the negative interest rates given the stability of the Swiss government and its financial system.   Thus, when the global markets turn down, the Swiss franc tends to appreciate.

Which is why I’m still bullish the Swiss Franc, despite potential continued cuts in their interest rates because other central banks around the world are cutting interest rates, so it all relative and the global markets are slowing and eventually will turn.

European central banks have cut rates to history lows

It won’t be easy for the EUR/CHF to get to parity (1.000) as there are many level where buyers are waiting to battle the sellers, but I think the war will be eventually won by the seller.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.