On Friday we got the all important Non Farm Payroll (NFP) number. The Dollar really got a strong bid as we have been forecasting. We have now seen the lows in the Dollar put in for the near term at least. We are looking to buy Dollars on dips this week. We are expecting this dollar strength to continue for at least a few weeks. Stocks also seem to have turned on the NFP number as well. If last weeks highs hold through this week, then we expect those to be the highs for the rest of the summer and possibly even the year.
EUR/USD:
We did short above 1.42 and are now looking for those levels to hold. We are looking for a retest near the 1.40 level this week that we can sell into. Bottom line here is near term weakness. We do not suggest chasing this or any market so be patient and wait for a reaction to sell into rather than chasing momentum.
GBP/USD:
This pair is also a sell in the low 1.60’s this week. We are looking for a rally back near the 1.62 level or so to also sell into. This market is showing new signs of leadership and may become a leading indicator for the Dollar again.
USD/CHF:
This pair is also turning with the others and we are buyers as close to the 1.08 level as we can get. This pair could see a move back into the low teens before this rally stalls.
USD/JPY:
This pair is a sell above 98.00 with stops above 99 while targeting a move back towards the 95 level.
AUD/USD:
This pair is a sell anywhere near the .80 level but caution is advised here as commodity volatility is likely to get even more wild than we have already seen as the Dollar begins to firm up.
USD/CAD:
This pair is very dependent on the direction of Crude oil. I continue to say that we will see 55 before we see 75 on crude so that translates into more upside for this pair as oil weakens. Sell into major rallies.
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