Currency markets begin the week in dead neutral for a vast majority of 28 currency pairs, and there is not much difference from last week's movements. The 2-week cycle to currency prices is alive and well, and this 2-week cycle has been derived by central banks since the year 2000 and seen from 5, 10, 20, and 50-day averages.
Before 2000, central banks met as they desired or as a need existed. In 2000, central banks agreed to meet every 35 days or six weeks. The 35 days would be considered maintenance periods or the inter-period between meetings.
Monthly averages are viewed as 30 days and close to equal six trade days per week X 6 weeks or 36 trade days. The numbers 5, 6, 30, 35, and 36 would become dominant to moving averages and assist in creating and solidifying the 2-week cycle.
EUR/USD 50-day moving average is not 50 days but 36 days and is located today at 1.1331.
Since 2000 and the maintenance periods, central banks have offered uniformity to the traded price. The 2-week cycle or every other week is seen as 1, 3, and 5 weeks and 2, 4, and 6 weeks. The EUR/USD pair in the six weeks from the Dec. 17 meeting traded weekly from Dec. 12 to 17 and onward as 197 pips, 187 pips, 82, 92, 197, 131, and 223.
Since the Feb. 3. meeting and last week, EUR/USD traded 162 pips and expected to trade this week right around 100 pips. EUR/USD averages from 5 to 50 days and factored ideally are located this week at 1.1415, 1.1378, 1.1314, and 1.1331.
GBP/USD averages of 5 to 50 days are found from 1.3547, 1.3546, 1.3505, and 1.3532. GBP/USD closed at 1.3547 directly on the 5-day average. The 2-week cycle is wholly dependent on movements from a break to a significant average or the week trades to dead ranges.
USD/JPY Last Weekly Trade
Short 115.56 and 115.63 to target 114.53 Result: 116.33 highs or 70 pips to entry. No problem. For the 3rd time in 11 weekly trades, required to add one lot and trade the USD/JPY pair until the target was hit.
Result 116.33 highs, Lows 115.01 as two lots traded short from 116.33 and 115.63. From 115.63 to 115.01 +62 pips. Then 116.33 to 115.01 +132 pips for a total of 194 pips.
The original trade offered 110 pips, then the reversal. In the trade at 116.33, the extra 84 pips were profit. From 1401 and +194 pips, the new weekly total heading into week 12 is +1595.
USD/CAD and USD/CHF begin the week overbought and neutral to overbought for USD/JPY. USD/CHF from 0.9246 and DXY 96.04 trades a spread at 358 pips.
As written, The spread will run 300 pips long into the future as USD/CHF is an excellent barometer to DXY. Locked in is 58 pips.
USD/CAD has not changed since last week as USD/CAD trades from vital levels at 1.2829 to 12661. CAD/CHF for the 2nd week running remains a problem to USD/CAD movements.
EUR/USD last week broke below 1.1385 and 1.1384 to trade 1.1344 lows.
The five-year average at current 1.1527 and rising by the week targets 1.1092. No trust in the bank's 1.0800 target. The current EUR/USD 6-month seasonal downtrend ends in May; therefore, EUR/USD has three months to achieve 1.0800 or 500 pips at 200 pips per month.
EUR/USD remains oversold on long-term averages on a long-only strategy.
Yen Cross Pairs
EUR/JPY, CAD/JPY and GBP/JPY are overbought and divergent to neutral AUD/JPY and NZD/JPY. The JPY cross pair strategy is short. GBP/JPY as a leader will move the most and pay the best. CHF/JPY is also a short-only strategy currency as we wait for the breaks at 123.00’s and 120.00’s.
AUD/USD and NZD/USD begins the week oversold. AUD/JPY and NZD/JPY prevent larger moves this week. However, AUD/USD and NZD/USD will perform almost to last week’s standards.
Assistance is derived from AUD/CHF and NZD/CHF as well as NZD/CAD and AUD/CAD.
Swiss Franc Cross Pairs
Oversold AUD/CHF and NZD/CHF are better trades compared to EUR/CHF and GBP/CHF while in the case of CAD/CHF, it is best to stand clear.
GBP/NZD drives EUR/NZD as GBP/NZD remains overbought. GBP/AUD is the better trade to EUR/AUD and the driver pair to EUR/AUD movements this week.
EUR/GBP sits deeply oversold yet the same old EUR/GBP as it lacks range. Watch 0.8415 and 0.8426.
GBP/USD remains at breaks below at 1.3446, 1.3381, and 1.3282. The five-year average at 1.3147 sits against many averages at 1.3100’s as 1.3100’s stands as a brick wall. Lower and short strategies for GBP/USD this week.
USD/JPY - Weekly Trade
Week 12 and 1595 pips banked. On to 2000 and no losses. Short 115.83 and 115.91 to target 114.82. Long 114.82 to target 115.25.
S&P 500 Day Trade
Long bottoms and short tops for the S&P 500. 4481.88 to 4356.43. Levels: 4480.85, 4464.22, 4401.11, 4396.54, 4391.52, 4386.51, 4376.48, 4366.45 and 4356.43.
Stocks and Indice Day Trades
AMC Entertainment Holdings (NYSE:AMC) 19.48 to 18.14.
Walmart (NYSE:WMT) 136.83 to 133.82.
NASDAQ 13532.78 to 14049.52.