Tom Hall Market Review #9 - Tuesday, 02 April 2019
Canadian Dollar / Swiss Franc The Daily timeframe developed a triple top and ascending wedge formation at the 0.7620 horizontal structure resistance.
The 01, March 2019 acceleration caused price-action to collapse, breaching the ascending trendline support, 50EMA, and 200EMA. A consolidation period developed pulling back to 0.7550 before the continued acceleration providing a clear bearish trend.
I waited for a second consolidation period back into the descending channel resistance, 61.80% Fibonacci retracement, and 50EMA. However, as price-action has failed to decelerate on the approach to structure, this trading opportunity is now invalid.
Although this trade opportunity failed to confirm my entry rules, I outline the structure as it's paramount traders understand that no matter how positive the confluence in a small trading zone, it may not necessarily validate a trade opportunity.
Euro / Swiss Franc The Daily bearish trend dating back to the 19, April 2018 provides a broader view of the overall structure; this information becomes more relevant when identifying exit levels.
Price-action found support at 1.1160 forming a bullish engulfing candle, this in addition to the oversold RSI status confirms how overextended price-action has been.
The 4-hour and 1-hour timeframes presented day trading opportunities with multiple layers of confluence; this confirmed my higher timeframe thesis. The healthy 2.5:1 reward comparative to risk allowed myself and clients to execute a long position on Tuesday, 02 April 2019.
Euro / Japanese Yen The EUR.JPY short term trend dating back to the 01, March 2019 lacks historical structure; however the multiple layers of positive technical confluence at 125.50 provides a narrow trading zone.
Technical confluence consists of the 125.50 horizontal structure resistance, ascending and descending trendline resistance ( confirming channel ), 61.80% Fibonacci retracement, and 50EMA.
Additional development is required throughout this week as a deeper consolidation period is required.
USOIL The long awaited 60.00 Weekly and Daily structure that had been identified on Market Review #1, #4, #5 and #6 failed to hold the bullish pressure.
The Daily ascending wedge formation is no longer relevant as the Weekly price-action continues to accelerate approaching the ascending trendline structure resistance dating back to 18, January 2016.
The RSI approaches overbought status on both the Daily and Weekly timeframes confirming the overextended run. Although I'm still bearish long term a significant amount of confluence are required to develop before presenting a short opportunity.
Key level of structure for the DXY is 97.60
The continued upside is expected.
UnknownUnicorn2528843
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@tomhall, hmm but why speculators drop their long positions??
UnknownUnicorn2528843
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@MalikHaris, if dxy has Up trend why speculators drop their long positions
UnknownUnicorn2528843
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@tomhall, i am talking about large speculators (non commercial)
UnknownUnicorn180388
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@MalikHaris, There are many reasons why this could be the case, including too much exposure to the USD.
I wouldn't focus on others, stick to your trading rules.