Ichimoku Report March 2nd
EURUSD – Stubborn as a Mule
To date, the pair has yet to close below the Kumo and has now posted 3 weeks of rejection from the 1.3500 level. There are obviously buyers willing to challenge the seriousness of this downmove and are staking claim here at the 1.3500 level. There has been several intraday probes below this level but all have been rejected and not one has had a daily close below. The pair is stuck in an intraday range between 1.3420-ish and 1.3630 so until this breaks, the range dominates. Mildly aggressive plays can be made on the outer edges of this range with tight stops. Overall, with the Kumo flat for the next few weeks, we could easily see the pair stuck in this area till early April as it should act as a magnet for price. However, we feel the longer term prospects are to the downside. Should the pair stay solid and hold 1.3500 until April, then the buyers should have more confidence and push the pair up to the Senkou Span B which climbs for the rest of the summer but will likely have a short leash for bulls making a ceiling just below 1.3800.
GBPUSD – Further Downside Expected
As we wrote last week, ‘Should the pair close below last weeks low then a move towards 1.5000 seems in order.’
As the pair closed below the previous weeks low with a final print on Friday at 1.5246, the pair sold off from the beginning and never looked back as we wrote, tagging the 1.5000 barrier yesterday and dropping way below that hitting a daily low of 1.4782 which is quite a move. We expect nothing but more sales for the pair and short term 1.5000 could act as resistance. The weekly low last week at 1.5151 and the weekly open (this week) at 1.5246 will likely act as upside barriers. We do not expect the pair to have a weekly close above 1.5500 for the rest of the summer with the Kumo being quite thick and flat from April – end of August. With the pair selling off 7 out of the last 8 weeks, why would we buy?
AUDUSD – Quietly building
The aussie is under the radar building up some steam for the bulls as its had now 2 of the last 3 weeks closing up with the two being relatively close to the highs suggesting the pressure is steady. Last week was a small down week but it found strong support at the Kijun which has now joined the Tenkan and 20ema at .8930 so this should act as a short term support for the pair. So far we are at the weekly highs and the larger structure seems to be in play which is an awkward expanding Triangle (of sorts). Overall we only like the dips to the 20ema or supposed Channel/Triangle top for now as possible plays. Other than that, this thing is a mess and we really do not like these structures.
USDCAD – Part of the Commodity Mess
After two weeks of closing down, the pair found an uptick and challenged the Kijun which has been flat for several weeks. However the air was too thin up there and the pair got rejected closing 150pips lower from the Kijun. Since then, the pair has tested the 20ema and failed there now producing lows below the last two weeks. We feel the only plays available are the 1.0200 region which could house some moderate buys there or selling at the Kijun/20ema combo. Overall though the charts are a mess as only the Kijun is falling sharply with the 20ema dropping at a tortuga pace and the Tenkan is flat.
NZDUSD – Flat like the World Once Was
Stuck within a 200-300 pip range for the last 4 weeks, the pair is suffering from a malaise of having no idea where to go. It obviously is respecting the 20ema which it has rejected off of now 2x and if the overall price action for the next few days is flat, there is no reason why we should not expect a third. Ironically the Kijun is climbing while the 20ema and Tenkan are flat. We do not expect the pair to eclipse the Kijun in the near future and the Kumo is not too far below so overall, this is a slow play to either side. Do not expect much.
Chris Capre specializes in using Ichimoku, Momentum, Bollinger Band, Pivot and Price Action models to trade the markets. He has built Ichimoku Systems for Institutions and has an Advanced Ichimoku Course for further training. For more information about his services or his company, visit https://2ndskiesforex.com
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