Welcome to my blog! This is my journal where I share my thoughts on various financial markets (primarily Forex) and talk through the actual trades that I make. Today, I’m analyzing the Forex market for February 1st, 2024. Read on to see my thoughts for today.
I’m feeling a little discouraged today. I don’t know what it is, but I’m not in the best headspace today. I probably shouldn’t be trading in this mood, but I’ve got to keep putting one foot in front of the other, so I’m giving it a shot. Let’s dive in.
EUR/AUD – Long
This has been very strong over the last several hours, and I think I just didn’t want to ignore it. Giving it a closer look, though, and I don’t really love it. Price had been up since Tuesday, and made a strong break to the upside this morning. The current (4 hour) candle is down a bit and appears to be retesting some support (that was resistance that was broken on this push up).
It looks like price is forming a bullish retest, or a bull pullback; but the highs where I’d want to place my entry is pretty far away from current price. Also, I don’t have a very strong outlook on this pair. If price does push back up, there’s another resistance area just outside of today’s highs that would be my target — this pullback is too deep already to give me a good R:R with that as a target.
I think I just wanted to make sure I had something to look at today, so I pulled it out. But I don’t love this so I’ll leave it alone.
CHF/JPY – Short
It looks like all of the JPY pairs have been down this morning, but most of them had already made a strong push. Franc-Yen, however, hasn’t. Price made a strong drop yesterday afternoon, but failed to meaningfully push through the major support area at roughly 170. On the 4 hour chart, price looks to be in a bit of a low base, but it looks like a lot of whipsawing on the hourly.
I’m considering putting in an entry order on the 4 hour chart, to play the break to the lows, but that’s a much longer-term play. I’ll look through the charts I have pulled out first, to see if I can find something that makes sense for today; and if I can’t, I’ll revisit this.
GBP/USD – Long
This has been ranging since the middle of December, and this morning, price appears to be bouncing off of the lows of that range. I don’t really have a range-bound strategy (technically) but this range was too clear not to at least take a look at.
Unfortunately, current price action is making this tough, so I think I’m going to leave it alone. Price made a strong push up off of those lows, but the strength doesn’t seem sustained. There was a rather deep pullback before making another push up. That pullback is where I’d want to put my stop, but it’s so deep that my R:R is below 1 with my initial target.
I don’t really feel comfortable trying to play this all the way to the top of the range — especially because I don’t plan on trading the 4 hour chart or holding through the weekend — so I think I’m going to hold off. The overall upward movement looks viable enough, but the way it’s moving makes it difficult to actually trade (pick a place to get out if I’m wrong, that also gives me a good return if I’m right).
I thought maybe I’d be able to take a shot at a new strategy here, but it doesn’t look like it’s going to work out.
EUR/USD – Short
This has been steadily pushing down since just before the end of last year, and lately has been failing at the MAs when they reach them. This morning, price bottomed out, rallied, and has just reached the 20 MA (which is also a key area that’s held up several times over the last couple of months). RSI is sloping up right now, but it’s still below 50, and we’re on the 4 hour chart.
Dropping down to the hourly chart, the strength looks more sustained. There was a drop last hour, but those losses were quickly recovered and price closed close to the open, and the next candle is threatening to push above. Actually, as I’ve been typing this, price did push through that key level, and looks strong.
Overall, I’m still bearish here, but it’s just not the right time to get in. I’ll keep my eye on this, and try to short it when/if it starts to head back to the downside.
NZD/JPY – Short
Like the other Yen pairs, this dropped pretty strong yesterday, and looks to continue that weakness today. For some reason, though, I like this pair the most. Price made the strong downward push, made a short 2-candle base/rally, dropped again, and has been rallying this morning. Ideally, that rally is what I can short in to. That said, I will say that this would be a breakout trade more than anything.
Dropping to the hourly chart, things don’t look as promising. Price has whipsawed a bit over the last few hours; the base isn’t that clean, and it’s not a clear bear-rally. On top of that, price still has a ways to go if it’s going to reach the prior support-now-resistance area that was broken on the second push down last night/this morning.
I could maybe argue taking this short on the 4 hour chart, similar to Franc-Yen, but as with that one, that would be a much longer-term trade. It’s not something I want to do right now, so I’ll hold off and come back if that’s something I decide to take a shot at.
USD/CAD – Short
Price had been up here, since the beginning of the year, but over the last week or so has been pushing down. Yesterday afternoon, there was a decent rally, but this morning price has dropped HARD. It started dropping after it reached the 50 MA, and as of now has reached the key area it reached before it rallied yesterday.
Technically, I think this would be a breakout trade, but it dropped so hard after reaching the MAs, I’m comfortable with that. As long as I’ve got a good R:R. Dropping down to the hourly chart, price looks really weak, with no signs of slowing down. I want to be in this. Price is pushing down on multiple timeframes, it failed at the moving averages, and it’s not oversold on any timeframe yet. I’ll keep my eye on the hourly and 15 minute charts here to look for a good setup to trade in to. Hopefully I can get in to this one as it’s my favorite pair on the day.
Thanks for reading! Let me know in the comments what you thought about today’s analysis; if you enjoyed it or if you have any feedback. And stay tuned for more analysis and trades!