Trading ideas: EUR/USD long in good shape after ECB
|The ECB remains constructive. Today, it left monetary policy unchanged, confirming its expectation that net asset purchases will stop in December and policy rates will remain at their current levels at least through the summer of 2019. The ECB also broadly confirmed its outlook for GDP and CPI as well as the risks to growth, with the latter still seen as broadly balanced amid resilient domestic demand. The only concession to the doves was the acknowledgement that uncertainty relating to protectionism, emerging markets and financial market volatility “gained more prominence recently”. The ECB did not discuss its reinvestment policy today, but Draghi stated that the ECB will shed some light here by December.
The Bank of England kept interest rates on hold and highlighted greater financial market concerns about Brexit, a month after raising borrowing costs.
This is how MyFXspot.com trades now:
EUR/USD
Trading strategy: Long
Open: 1.1550
Target: 1.1750
Stop-loss: 1.1605 (raised from 1.1450)
Recommended size: 2.00 mini lots per $10,000 in your account
Short analysis: Fourteen-day momentum remains positive, reinforcing the overall upside potential. The scope is for gains through the 1.1734 August peak. We remain long at 1.1550 for 1.1750 target. We have raised our stop to 1.1605 to lock in some profit. EUR/USD reaction after today’s ECB meeting is encouraging.
GBP/USD
Trading strategy: Buy
Open: 1.3030
Target: -
Stop-loss: 1.2930
Recommended size: 1.50 mini lots per $10,000 in your account
Short analysis: We see more intensive push inside the daily cloud and a pick up in 14-day momentum, which suggest near-term outlook remains bullish. We have raised our bid to 1.3030.
USD/JPY
Trading strategy: Short
Open: 111.30
Target: 109.30
Stop-loss: 112.30
Recommended size: 1.67 mini lots per $10,000 in your account
Short analysis: Bulls have once again broken above the daily cloud top, now at 111.58 and are now seeking a daily close above the 111.88 Fibo, a 61.8% retrace of the 113.18 to 109.78 (July to August) fall. Bulls should be mindful of previous false breaks above the cloud top, however.
USD/CAD
Trading strategy: Sell
Open: 1.3065
Target: -
Stop-loss: 1.3200
Recommended size: 1.44 mini lots per $10,000 in your account
Short analysis: USD/CAD breaks below 100-day MA (1.3039) on NAFTA talks and higher oil prices. On the other hand, the support area just below 1.3000 is holding for now, with more firm support tipped ahead of 1.2900 at 1.2915 the lower 21-d Bolli and then the 200-DMA by 1.2860. Our trading strategy is to sell on upticks.
AUD/USD
Trading strategy: Await signal
Open: -
Target: -
Stop-loss: -
Recommended size: -
Short analysis: Bounce from the 2018 low extends and nears the 10-day MA. Daily RSI is biased up so this bounce might extend. Monthly techs remain bearish though. Signals are a bit mixed so we will stand aside until the outlook clears before entering a position
EUR/GBP
Trading strategy: Await signal
Open: -
Target: -
Stop-loss: -
Recommended size: -
Short analysis: Bear bias holding on dailies but doji action still suggests a lack of market conviction. However, failure to regain ground above the daily cloud top will keep balance skewed for further losses. 55-day MA (0.8926) could also prove a key level. We stand aside.
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