Feb 18 2020 0
In the first session of the week, the price fluctuated very low, but many pairs were facing important prices, especially EUR/USD and AUD/USD. Now let's look at all the daily charts of the most common pairs to see what forex trading strategies we should choose.
- Japan's economy has slowed down at the fastest pace in nearly 6 years in the quarter ending in December. The cause of the increase in taxes affecting consumer spending and businesses increases the risk of recession when the outbreak of Covid-19 in China is on the rise.
- China imposes restrictions on movement in Hubei Province to prevent the spread of the virus. Specifically, 60 million people in Hubei Province were required to stay home unless there was an emergency, while the use of personal cars was banned indefinitely. Only one person from each household is allowed to leave home every 3 days to buy food and essential goods.
- China has approved the import of all poultry products from the United States including breeding birds, before that, in 2015, Beijing banned the import of all poultry products from the United States because of the bird flu at the time.
USD/JPY was still the same, not much changed in the first session of the week. An area of cumulative price is still being established. The current price level is not suitable for buying/selling, instead of observing the price action carefully at both sides, if there is a downside signal, it may be short, especially at 110.2.
Although the price has not created a new low, the selling pressure is still overwhelming, it is likely that the inverted hammer model has failed. Currently we should consider two possibilities:
Price will penetrate the current strong area to 1.075, noting that the range is not much;
The price will create a Stop Loss sweep to remove traders from the order soon.
The main policy is to maintain the status of the bottom fishing orders the previous day (you can narrow the Stop Loss if desired) and not stuffing. In case of noticeable bullish signals after the SL scan, it is possible to consider long. Note: the above cases are all short-term transactions.
The price did not breakout up to complete the flag pattern, signals and the current price on GBP/USD is not very nice, need to observe more and should not trade this pair for the time being.
The downward momentum met a bit of reaction when approaching the MA20 on the daily chart but the pressure was not large and the transition zone of 1,325 and the MA20 on H4 was still maintained. We do not change the view but continue to expect the price to return to the 1.32 zone.
After a few days of accumulation, the price still failed to penetrate the downward channel and is returning to the lowest price level in 11 years. Do not trade at the moment. Pay close attention to price action at the lower boundary of the range. If there is a strong enough bullish signal, consider long positions. On the contrary, if this support zone is penetrated, the price might return to the 0.66 zone.