Yen Strength Signaling Potential Risk Aversion – FX Daily Forecast 4/6/16
EUR/USD Range Continues
Another range bound day for the EUR/USD today. We did get a stop run of our lower manipulation point today but did not manage the pullback. Strangely enough, even with the super tight range and the wider stop we missed the pullback by 2 pips. Needless to say we have seen more beautiful trades that just nearly missed over the last month or two then I think I have seen in years. I’m actually quite surprised that even during what I consider to be tougher trading conditions, the strategy continues to churn out profitable months. I’m a firm believer that a trading strategy is not defined by how well it does when everything is going well, but rather how well it does when a great deal is going against you. If your worst months are still in the green then your doing quite well. As far as today’s analysis for the EUR/USD we could literally use the exact same chart from yesterday as all of our listed levels remain the same and the directional bias remains open.
Pound Continues Previous Cycle Down
Yesterday the GBP/USD stalled the cycle to the downside and we went back to the open directional bias. As I always say, with this trading strategy, if you question market cycle then you always go back to trading with an open directional bias. In that situation we take any valid stop run from any of the pre-selected manipulation points. What we had today was the second push to the downside. This resumes the previous cycle and I will be looking for the third push to the downside today. As far as any listed manipulation points from which we will be looking to catch that third push, we have one. Additionally a backside stop run reversal short from yesterday’s lows would be valid as well if the proper criteria is met. Keep in mind the major March 14th lows should we actually get the third push down. I would be happy to take a stop run long from that point should it setup.
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Forex Market News For April 6th 2016
US FOMC Meeting 2:00 PM Eastern: This is an obvious news release we will never carry into and this month will be no different. Especially if the EUR/USD and GBP/USD were to fall near or beyond the ADR prior to the FOMC meeting, the higher probability would then be for the reversal back up going into the news. Yellen has been extremely dovish and this is basically a repeat of what was previously said. Overall I will personally be sitting back and waiting to see what she has to say and how the market is responding to it….without any running positions.