Welcome to the MID-WEEK FOREX MARKET UPDATE 10/16/18. We have a decent start to the week this week in the Forex markets as we have a slight recovery in the US equity markets. We have the “Risk On” growth currencies of NZD, CAD and AUD leading the charge, with NZD up ahead after a much stronger CPI inflation report Monday night. The GBP is not too far behind, riding off stronger than expected wage growth for the prior 3-months rolling average and a steady unemployment rate at 4%. We have a very big event out of GBP tonight with their monthly inflation report CPI numbers. This should cause some major movements with the GBP and should dictate this currencies direction for the rest of the week.
MID-WEEK FOREX MARKET UPDATE 10/16/18: USD
The USD is looking ready to move higher in the coming weeks as we find very strong support on the psychological 95.00 level once again. This also lies on the 50% Fibonacci level and we had a spinning top indecision candle form on this support. This all is occurring after a higher high was formed and we had a pullback to form a potential higher low on this support. That would tell us that a push higher is the most probable next course of action for the USD.
That’s the MID-WEEK FOREX MARKET UPDATE 10/16/18 for USD.
This USD long opportunity lines us up perfectly for EURUSD short setup to play out. As you can see on the EU chart above, price moved below strong weekly support to set a new lower low before pulling back to set a potential lower high. We have price hitting a strong resistance, on the 50 SMA and yesterday closed with a shooting star reversal candle. This gives us a very high probability short setup, which we will be diving into the smaller time-frames to look for an entry.
We have a two-day EU economic summit on Wednesday and Thursday to be on the lookout for with European currencies. Wednesday also brings us the USD FOMC Meeting Minutes recapping the interest rate hike from three weeks ago. This could cause some strong movement for the USD. Later that night we have unemployment numbers out of Australia and BoJ Governor Kuroda speaking.
Thursday early am we have retail sales numbers out of the GBP and day two of the EU Economic Summit. Later that night China releases their quarterly GDP numbers- which always has a strong impact on the global equity markets and the “Risk On/ Risk Off” theme.
To end the week on Friday, we have the BoJ Governor Kuroda speaking again early on. After that, we have a very strong day for the CAD with inflation CPI numbers and Retail Sales. The week comes to an end with BoE Governor Carney speaking.
That’s the MID-WEEK FOREX MARKET UPDATE 10/16/18: Summary
We have a loaded second half of the week, so make sure you are well aware of all the high-impact events and when they will be happening.
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