Last week: In last week’s update I had discussed the mean-reversion potential for a number of FX pairs and, whilst this looks to be evolving, I’m wondering if FOMC might disrupt, or even halt, the process? There were numerous trend line breakout trades and TC signals with all of this movement though and there are more patterns with trend lines to monitor in this FOMC week.
The US$ had a bearish week following the previously weekly break down through 95.50 support. There is FOMC in the coming week and I’ll be watching to see if this can reverse recent bearish sentiment at all.
One of the best features with the TC trading system is that there is no bias and traders simply have to watch out for momentum-based trend line breakouts. As sure as sun follows day chart breakouts tend to follow congestion and last nights ECB news helped to trigger more breakouts to add to this week’s tally. The TC Trial will be winding up in the coming weeks and has delivered very pleasing results from those traders who were able to commit fully to the Trial. There will be more on this at a later date.
This is a brief update of some of the major FX pairs and ASX-200 ahead of today’s AUD Employment data and BoJ and ECB rate updates.
The AUD/JPY is up testing a major S/R zone at 89 and has not made a monthly close above this level since July 2015; a period of two years. Keep an eye out for any new monthly close above this resistance to support a continuation move up to test the monthly chart’s bear triangle trend line above the 95 level.