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I’m expecting a bit of a slow start to the upcoming trading week as the calendar looks pretty slim for Monday. Tuesday begins to show more promise for volatile markets, but the real fireworks are scheduled for Wednesday in the form of an FOMC statement at 2pm EST.
This event always moves markets, but this week’s FOMC could prove to be more volatile than most given the speculation around the timeline of when the Fed is likely to hike rates.
I’m not implying in any way, shape or form that we should try to speculate on the news or read into the outcome. As you know my trading style relies 100% on technical levels, patterns and strategies. However I do advocate the awareness of major news events as they feed the price action we trade. That said, be sure to take this event into account when planning your trades for the week.
Now for the setups…
The first potential setup I want to cover formed on GBPCAD. The pair has been in an uptrend for almost the entire year, however the month of March has challenged this uptrend and appears to be winning the battle thus far.
The chart below shows what appears to be a topping pattern that has been in the works since early February. This pattern was confirmed on Friday when the pair closed the week below trend line support.
From here I’d like to see a move back to former support (now resistance) in combination with bearish price action on the 4 hour chart to confirm a short setup. There isn’t a ton of room to the downside before we run into the 2014 high at 1.8660, but a short position from new resistance should net us about 200 pips.
Summary: Wait for a move back to former support around 1.8870 and then watch for bearish price action on the 4 hour chart. Key support comes in at 1.8660.
USDCAD analysis
CADJPY analysis
USDJPY analysis
NZDJPY analysis
