Forex Trade Setups (London Close) Apr. 3rd

Dollar Gains Ahead of The FOMC
The USD gained vs. the major bloc ahead of the FOMC meeting coming up where there is a lot of economists expecting to hear some more comments from the FED about possible ‘monetary easing’. This is because the data is still disappointing with today’s factory orders coming in slightly under expectations at 1.3%.  Add continued worries about Spain becoming the new Greece with their banks holding over €80Billion of toxic loans to the failed construction/real estate market and the worries about the EZ continue.

Remember, Spain is a much bigger economy then Greece and if house prices continue to fall, the already stressed banks will face hefty losses on those loans and this is just the beginning of their issues and will continue to be a thorn in the side of the European recovery.  This should keep additional pressure on the Euro and be of benefit to the USD while people still maintain the rosy (and we think deluded) view of the US economy.

But for now, price action will be muted ahead of the FOMC minutes coming soon as traders and investors will be hawking their comments for any talk about easing.

USDJPY – Forms Pin Bar Off Daily and 4hr 20ema
After recovering some of the losses from yesterday, the USDJPY bounced off 81.50 forming a piercing pattern from the lows suggesting we might be seeing a false break.  But the pair ran into intraday resistance at the daily and 4hr 20ema creating a forex pin bar strategy setup on the intraday highs.  If this 20ema holds, we could see price action return back to the 81.50 lows to re-test the buyers down there.

Taking out this level down below threatens a further unwinding in the JPY while a close above 82.50 suggests the pair is likely resuming another attack on the upside.  Watch for price action triggers after the FOMC as traders and investors will take clues from the comments out of the FED.

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Buddhist, Trader and Philanthropist

I'm Chris Capre, Founder of 2ndSkiesForex. I help traders of all levels change the way they think, trade and perform. As a professional trader, I specialize in trading price action. As a teacher, my passion lies in showing you how to re-wire your brain for successful trading. Want to improve your edge right now? Visit my Price Action Course page.

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