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Top Trade Idea For June 12th, 2015 – AUD/USD

By Ric Spooner of CMC Markets

My chart this week involves a developing situation that might present an opportunity over the course of the next week or two.
The Aussie Dollar has made two neat trend lows at around the same level. From here the obvious alternative would be completion of a double bottom pattern. This will be completed if the Aussie rallies to make a clear break above the peak between these two lows. A typical strategy with a double bottom break out is to base a target on the measuring rule which projects that the move following the break out will be the same size as the pattern itself. It’s also not unusual for these rallies to fail at the 61.8% point between the break out and the measuring target. This can be a useful place to take partial profit and/or to start moving your stop to protect profits.
However, there is another alternative here. If the Aussie rally fails below the double top resistance, it will begin to form a descending triangle pattern. In this case the break out strategy would involve selling if the Aussie breaks below the triangle support or buying if it breaks above resistance.

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Top Trade Idea For June 16th, 2015 – AUD/USD

By Gregor Horvat of www.ew-forecast.com


AUDUSD remains bearish in larger time frame despite some recovery back in April which was a temporary move with an overlapping structure, which is called corrective in Elliott Wave Theory. We know that this is a characteristic of a contra-trend price action, so trend remains down for now within impulse that is in play since mid-2014.We see market moving sharply lower now after broken upward channel, so wave (5) is in play for a move down to 0.7100-0.7300 area.
AUDUSD Elliott Wave Analysis-Daily Chart


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Top Trade Idea For June 17th, 2015 – USD/JPY

By Matthew Weller of Forex.com

The long-awaited June FOMC meeting is upon us, and while the central bank will almost certainly leave interest rates unchanged, we still expect elevated volatility as traders refine their interest rate expectations. As we noted in yesterday’s FOMC Preview report, traders will have three main areas of focus in the wake of the announcement: the Summary of Economic Projections, the votes, and Janet Yellen’s press conference. Ideally, all three of these factors will form a coherent narrative either for or against a September rate hike, with straightforward implications for the US dollar.

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Top trade idea for June 19th, 2015 – EUR/NZD

By Ricspooner of CMC Markets

The New Zealand Dollar has trended down strongly in recent weeks as its central bank embarked on a rate cutting cycle. Fuel was added to this trend when the latest GDP came in at a disappointing 0.2%. At the same time the Euro has been pushing higher against a range of currencies and the net result has been a strong uptrend in EURNZD.
However, this trend has now arrived at an interesting stage with potential to complete a bearish AB=CD pattern as outlined on the daily chart below. There’s a lot of symmetry about this pattern. The CD leg replicates the AB leg in both time and price. However, if EURNZD keeps pushing higher from here another possibility would be a reversal from the point where CD = AB X 1.27 at around 1.687 (127% is a commonly used Fibonacci ratio).

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Top Trade Idea for June 24th, 2015 – EUR/JPY

By Fawad Razaqzada of Forex.com

The EUR/JPY has been climbing higher inside a bullish channel since bottoming out around 126.00 in early April. But the rally has now stalled with the pair finding strong resistance around the area between 140.75 and 141.00. As can be seen on the chart, as well as this area being a previous support/resistance it also corresponds with the 61.8% Fibonacci retracement level of the last major downswing – i.e. from the December peak of 149.75. Given this deep retracement and the slow-down in the bullish trend, we wouldn’t be surprised if the EUR/JPY were to form a top here. Indeed, a potential break out from the bullish channel could lead to a significant withdrawal of bids and potentially an increase in selling activity.
The key support level that the bears will need to take out is at 138.00 – the low from earlier this month. Below here we have the 200-day moving average at 137.30 and the previous resistance at 136.75; these levels could offer some short term support. A potential break below 136.75 could be a very bearish outcome which could lead to an eventual drop to the 38.2% or even the 61.8% retracement levels of the upswing from April, at 135.35 and 131.80 respectively.
Meanwhile if support at 138.00 holds once more then we wouldn’t rule out the possibility for a bounce back to the abovementioned resistance area of 140.75-141.00. And if price were to climb back all the way there then there is no reason why it shouldn’t be able to rally beyond that point. Indeed a decisive break above 140.75/141.00 would signal that a major upward continuation is underway.

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Top trade idea for June 25th, 2015 – AUDUSD

By Mircea Vasiu of www.capitalpropertiesfx.com

Despite desperate efforts from Governor Stevens and other RBA members to talk down the Australian dollar, the audusd pair is holding the recent levels quite good and the fact that is not able to clearly break the 0.77 area brings into question a possible reversal pattern.
In this case, in the chart above I am looking for a contracting triangle that should end above its beginning, namely above the x wave in green, and this is as bullish as can be when it comes to a reversal pattern.

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Top trade idea for June 26th, 2015 – EUR/USD

By Michael McCarthy of CMC markets

On Monday, this blog piece laid out a strategy to go triple short EUR/USD. A key part of my overall strategy is identifying higher reward to risk ratios, and this set up ticks the box, with each entry risking between 50 and 100 points against potential gains of 500 to 900 points. The triple short has triggered on all three entries, in my view lifting the probability of a successful trade. And the good news is the price action since gives clear entry and stop levels for traders looking to join the action.

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Top Trade Idea For June 30th, 2015 – USD/CAD



By Gregor Horvat of www.ew-forecast.com


USDCAD made a deep retracement in the last two months but with corrective personality from the highs, down into 38.2% Fibonacci level where pair found a low, possibly completed fourth wave. That said, despite a strong bearish turn, we see big trend still bullish, so we would not be surprised if pair will continue higher in weeks ahead, especially now when the upper channel line gave way and price overlapped wave A).

Elliott Wave Analysis – USDCAD Daily

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Top Trade Idea For July 1st, 2015 – USD/CHF


By Matthew Weller of FOREX.com

The constant barrage of Greek headlines continues unabated, with the latest batch of rumors suggesting variously that the “no” votes for this weekend’s referendum are gaining momentum, that the Greek government will cancel this weekend’s referendum, that a breakthrough deal between Greece and her creditors is imminent, and that the two sides are further apart than ever (see my colleague Kathleen Brooks’ note from earlier today for the latest analysis of the ever-changing situation in Greece).
As if that wasn’t enough, we’re entering a critical 24 hours for US economic data, starting with this morning’s release of the June ADP report. The widely-watched employment figure came out strong, showing 237k new jobs were created in June beating the market’s expectation of a 219k reading and the revised 203k jobs that were created in May. By printing at its highest level since last December, the ADP report reminded traders that the US economy continues to chug along and provided a sharp contrast to the serious issues with the European economy. As we go to press, traders are eagerly waiting to see if today’s Manufacturing PMI survey confirms the strength of the ADP report.

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Top Trade Idea for July 8th, 2015 – NZD/USD


By Fawad Razaqzada of FOREX.com


The NZD/USD’s long-term downward trend has accelerated in the past couple of months. It has been driven lower by a number of factors, including the sharp falls in key commodity prices for the New Zealand economy such as powdered milk, the RBNZ turning dovish with a surprise rate cut and the US dollar rally gaining momentum on increased safe haven demand and speculations about a Fed rate hike at the end of this year. But has the selling been overdone? Though we expect the Kiwi to head further south over time, it is starting to look a little bit oversold in the short term, so the risks for a counter-trend move are high. Indeed, as can be seen from the sub-chart, the Relative Strength Index (RSI) is at extremely oversold levels between 20 and 30. The last time the RSI was this oversold, back in early February, the NZD/USD went on to stage a +550-pip rally. That rally eventually came to a halt at the end of April. Since then, price has been heading sharply lower inside a bearish channel. Not only has it broken below the February low, it has now fallen almost exactly how much it had rallied since that month’s base was established. In other words, the Kiwi has reached the 200% retracement level of its upswing from the February low. This marks an exhaustion point in the market. What’s more, price has also reached the lower support trend of its bearish channel.
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Top trade idea for July 14th, 2015 – XAU/USD

By Gregor Horvat of ew-forecast.com

Gold is moving lower, now trading very close to previous low so we see downtrend as incomplete. We are tracking an updated count that shows an ending diagonal in wave 5). That's a reversal pattern that occurs at the end of a larger trend, so we suspect that precious metal will find a low later this year and turn up from around 1030-1100

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Top trade idea for July 14th, 2015 – XAU/USD

By Gregor Horvat of ew-forecast.com

Gold is moving lower, now trading very close to previous low so we see downtrend as incomplete. We are tracking an updated count that shows an ending diagonal in wave 5). That's a reversal pattern that occurs at the end of a larger trend, so we suspect that precious metal will find a low later this year and turn up from around 1030-1100

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Top Trade Idea For July 15th, 2015 GBP/JPY

By Matthew Weller of FOREX.com

For traders who werent paying close attention, it was easy miss todays Bank of Japan meeting in the cacophony of todays other high-impact news releases. And while the central bank did not make any changes to monetary policy, as anticipated, the banks policy board did ratchet down its expectations for growth and inflation, with potentially important implications for later this year.

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Top Trade Idea For July 17th, 2015 – NZD/JPY


By Ric Spooner of CMC Markets

It’s been a rough few weeks for the Kiwi Dollar with falling milk prices, weak inflation and expectations of a second rate cut at next week’s central bank meeting.
Despite all that, the NZDJPY chart is showing early signs of a possible bullish divergence setup. If price rallies from here, it will confirm a lower low while the 14 day RSI would diverge making a higher low. Not only that, if a rally of any significance gets underway from here it would complete a double bottom pattern on the price chart with a break above the dashed resistance line.
One common strategy for RSI divergence setups is to buy if the RSI closes above its most recent peak after diverging. This is shown by the dashed resistance line in the box below the chart. A close above this resistance would confirm the RSI making both higher lows and higher highs. It would also be rising out of the oversold zone so this might be a strategy to get in early on the double bottom setup. However, if the RSI can’t do this and price keeps falling, there is no setup.

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Top Trade Idea for July 22nd, 2015 – EUR/USD


By Fawad Razaqzada of FOREX.com

The one hour chart of the EUR/USD shows that it may have formed a near-term double top at 1.0965. This points to further price weakness and we may after all see the world’s most heavily traded FX pair break below May’s low and key support of 1.0820 before heading significantly lower in the coming weeks. Thus going forward the key levels to watch are 1.0965 to the upside and 1.0820 to the downside; a break outside of this range could lead to a sharp move in that direction.
As the daily chart shows, the EUR/USD has been trending lower in recent weeks. The investor focus has returned to the interest rate differential between the US and Eurozone economies. Whereas the Fed has signalled that it is ready to hike rates later this year, the ECB has only recently started QE and last week there were no suggestions from President Mario Draghi today that the central bank is ready to trim or end the €60 billion a month stimulus programme early. Thus, the ultra-accommodative monetary policy is here to stay for now and this should in theory put downward pressure on European bond yields, which in turn could depress the euro even further.
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Top Trade Idea for July 24th, 2015 –USD/SGD

By Michael McCarthy of CMC Markets


Sell an “M” Reversal in USD/SGD
Conventional wisdom is that the USD will continue to strengthen as the first Fed rate hike approaches. However:
Markets rarely go anywhere in a straight line
The US Dollar index is up 4% over the last 5 weeks, and more than 20% since February 2014
Some of the most profitable technical trades go against the fundamentals.
With these points in mind, have a look at this possible reversal signal:
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Top Trade Idea for July 28th, 2015 XAU/USD



By Gregor Horvat of ew-forecast.com


Gold is trading at new lows, currently around the trendline connected from the start of 2014 where support can be found, especially if we consider the shape of an ending diagonal placed in fifth wave. Thats a very important reversal pattern that suggests a bounce in the second part of 2015 and maybe very strong recovery in 2016. Well, if we are correct then lows could be near as we have all needed substructure for a valid formation. However, as always we need a confirming price action, before we may look for a bottom in place. In our case, we need an impulsive rally back to 1230 to confirm a change in trend. Until that happens, trend is still down!

GOLD Daily Elliott Wave Analysis
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Top Trade Idea for July 29th, 2015 – USD/JPY

By Matthew Weller of FOREX.com

It’s been a quiet overnight session for most major currencies as market participants refrained from placing large trades ahead of today’s FOMC meeting. As we noted yesterday, the central bank is unlikely to make any outright changes to monetary policy, but the wording of the accompanying statement could tilt the scales in the hotly-contested “September vs. December” (for the first rate hike) debate.
Heading into the release, USDJPY may be the most important currency pair to watch. The unit rallied sharply off its 100-day moving average near 121.00 earlier this month before stalling out around 124.50 and pulling back over the last week. It’s not surprising that the rally lost steam around the 125.00 handle, a level that traders have dubbed the “Kuroda Line.”
Much Like France’s famed Maginot Line in World War II, a policymaker has built “obstacles” to prevent enemies (USDJPY bulls) from crossing a certain level. Last month, BOJ Governor Kuroda, BOJ member Sato, and Japanese Finance Minister Aso all warned against further yen depreciation in the same day, creating the perception that Japanese policymakers would not tolerate USDJPY trading above 125.00. Based on the price action over the last week, these comments left an indelible scar on the psyche of USDJPY traders, who remain extremely wary of driving USDJPY above the 124.50-125.50 zone.

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Top trade idea for July 31st, 2015 – GBP/CAD

By Ric Spooner of CMC Markets

Last week GBPCAD arrived at a swing equivalent level where the last swing (“CD”) was the same size as the swing leading into it (“AB”). It’s quite common for trends to end at this point, setting up for a significant correction.
The uptrend in GBPCAD had been losing momentum as it approached this swing equivalent level. This is demonstrated by divergence with the 14 period RSI shown in the box below the chart. It was starting to make a series of lower highs, starting from up in the overbought zone above 70%, while price was still making higher highs.

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Top Trade Idea for August 8th, 2015 – AUD/USD

By Michael McCarthy of CMC Markets


The down draft in the AUD has echoed the slide in commodity prices. For those who think that oil and copper, as examples, are near lows, the AUD may provide an excellent commodity basket proxy play. A statement today from the RBA may add an interest rate component to a short EUR/AUD position.
The RBA could be edging markets away from short AUD positions. Lowering economic growth expectations on the back of lower than forecast population growth is the latest in a recent series of hints, most notably the call from the Governor that the stimulus benefits of lower rates must be balanced against the longer term systemic risks (read build-up of leverage). On the other hand, the ECB appears fully committed to ongoing stimulus.


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