Ok, boring first, as I suspected it would be quite a calm week for USD as it ought to digest its previous downtrend move. The USD has been staying in the range without any hints of what direction the breakout would occur in. So let's wait and see what happens the upcoming week. If there are some decisive moves towards the range boundaries, we can devise a plan accordingly. I would be more prone to consider shorting USD in general, towards the previous trend.
Gold has finally made a decent correction after the surge to the new all-time highs. Notice, that the level 1900, which is the high of September 2011, now became the mirror support. That's a good sign of the healthy bullish trend. This week it'd be nice to look for some bullish reversal setups based on the rebound from 1900 level and trend continuation setups afterwards. I'm not much into fundamentals, although I find a solid reason to stay long on Gold in the mid-long term as the interest rates will most likely remain very low for a while, and printing money continues in the US and Europe.
Now, let's look at something more dynamic. My main focus in the upcoming week would be on the strength of the European currencies (EUR, CHF and GBP). Their indexes are all in a strong uptrend with some minor divergencies. The kicker here is to timely decipher which currency of the three has the most obvious relative strength. First of all, I chose not to display GBPCHF, as to me that's a symmetrical triangle formed in a multi-year range, - fairly neutral condition to have a bias in any direction.
EURCHF has drawn my attention since the middle of May 2020, as it started to show aggressive signs of the long-term downtrend reversal. Although the pair seems to tighten to 1.0740, gradually, I see this pair going up in the mid-term. Therefore I'm long EUR here overall.
EURGBP is consolidating near the upper band of the local range around 0.9050. That recent price action tells me EUR might be stronger at least in the short-term.
And here is the highlight - AUDNZD. The pair has broken the long-term trendline started in October 2017, and confidently advances further. Australia, as the second Gold producing country in the world, should correlate with the price of Gold somehow. We can see a positive correlation of the AUDNZD with Gold since the middle of July. Last week Gold has corrected the strong upside move, but AUDNZD remained strong. That tells about the relative strength of AUD. I'll be looking for the trend continuations setups in AUDNZD in particular as NZD seems weak against European currencies too.
That's it for now. I'd be curious to know your opinions about other fundamentals that drive the discussed currencies:)
Gold has finally made a decent correction after the surge to the new all-time highs. Notice, that the level 1900, which is the high of September 2011, now became the mirror support. That's a good sign of the healthy bullish trend. This week it'd be nice to look for some bullish reversal setups based on the rebound from 1900 level and trend continuation setups afterwards. I'm not much into fundamentals, although I find a solid reason to stay long on Gold in the mid-long term as the interest rates will most likely remain very low for a while, and printing money continues in the US and Europe.
Now, let's look at something more dynamic. My main focus in the upcoming week would be on the strength of the European currencies (EUR, CHF and GBP). Their indexes are all in a strong uptrend with some minor divergencies. The kicker here is to timely decipher which currency of the three has the most obvious relative strength. First of all, I chose not to display GBPCHF, as to me that's a symmetrical triangle formed in a multi-year range, - fairly neutral condition to have a bias in any direction.
EURCHF has drawn my attention since the middle of May 2020, as it started to show aggressive signs of the long-term downtrend reversal. Although the pair seems to tighten to 1.0740, gradually, I see this pair going up in the mid-term. Therefore I'm long EUR here overall.
EURGBP is consolidating near the upper band of the local range around 0.9050. That recent price action tells me EUR might be stronger at least in the short-term.
And here is the highlight - AUDNZD. The pair has broken the long-term trendline started in October 2017, and confidently advances further. Australia, as the second Gold producing country in the world, should correlate with the price of Gold somehow. We can see a positive correlation of the AUDNZD with Gold since the middle of July. Last week Gold has corrected the strong upside move, but AUDNZD remained strong. That tells about the relative strength of AUD. I'll be looking for the trend continuations setups in AUDNZD in particular as NZD seems weak against European currencies too.
That's it for now. I'd be curious to know your opinions about other fundamentals that drive the discussed currencies:)
