Weekly Forex Forecast (10/10/22) EurUsd / XauUsd + Forex Trading Plan! [HD]
foreign ERS it's John Fortune here with this week's weekly Forex forecast I hope you're having a great weekend last week we had strong employment data out of the US and as a result we saw the dollar bouncing off the lows the dollar bull market is still intact and going into next week we have inflation data out of the us and this is a big event you need to keep your eyes open for and pay attention to next week okay so a quick look at the economic calendar and last week we had ISM Manufacturing come out on Monday worst than expected and this actually caused a two-day rally in the stock market and also saw markets like gold and silver rallying to the upside but the actual reading itself was still above 50. so what this is telling you as a leading indicator is in about 12 to 18 months time the US manufacturing sector is actually set to grow still but at a slower rate than previously we then had ISM services and remember the service sector in the US is actually greater or larger than the manufacturing sector and this came out better than expected and pretty much unchanged from last month so we are still seeing fairly strong leading data out of the US and when you couple this with the strong jobs data that we had a surprise to the upside in and also the unemployment rate actually dropped and this is an extremely tight uh labor market here at 3.5 this just gives the fed the green light to hike even more aggressively and now a 75 basis points hike in November which was previously thought was going to be 50 basis points by market participants they're now baking in the likelihood of a 75 basis points rate hike and this is why we started to see the dollar bouncing at the end of last week and I am interested in dollar long plays once again heading into this week so if we come ahead to this week on Monday it is a U.S Bank holiday so I expect the markets to be very dull not much happening on Monday the markets are likely to start to get moving from Tuesday onwards and the important piece of data coming out this week is the CPI data on Thursday and the reason this is so important is because the FED as it currently stands are hiking at the fastest rate in history and it's to control inflation and just with the data we saw out of the US last week if this comes in hotter than expected it will be bullish for the dollar bearish equity is and if it comes in cooler than expected or if we start to see inflation coming down this would likely elicit a negative reaction from the dollar and a positive reaction from stock so keep an eye out for this on Thursday but just bear in mind if inflation were to come down say from 8.3 to a reading of eight or even if it came out to 8.1 the actual overall inflation reading of eight is still very very high the FED
are unlikely to Pivot at eight percent inflation just because it's dropped from 8.3 to 8.1 or 8.0 okay so let's have a look at the scorecards for the coming week and just a quick note I am getting over a cold so apologies if I sound a bit stuffed up in today's video but in terms of the scorecards heading into next week you can see we have quite an interesting development here with the US dollar and also the Euro strengthening in the scorecards and very similar to what we discussed before when the Euro and the dollar are both on the positive side or on the negative side this generally means opportunities are drying up and we should be cautious really only taking the best opportunities in the market and very often the dollar itself is corrective or choppy when we see the dollar and the Euro both on the same side of the scorecards on a one month forward-looking probability basis and in fact if you go look at the dollar which we're going to do you will see even though it bounced last week it's still kind of correcting it's still kind of moving sideways and we're not back to the highs we were previously so that's the first thing to note is that market opportunities are not expanding just yet and we should be selective still with the risk we're taking especially with CPI coming up next week the next thing to note is that it is the commodity currencies as I said to you last week which are starting to form over on the negative side and this is a sign of a flight safety in the currencies because in a downturn or in a big risk-off environment you see commodity currencies like the New Zealand dollar like the Aussie uh like the Canadian dollar underperforming even currencies like the Euro like the pound Etc especially the risk off currencies like the Frank and the dollar but what's interesting is the Yen has actually weakened in the scorecards now for GMT members watching this you will know that we did look at New Zealand shorts Aussie shorts against the yen in LA last week's daily videos if you are involved in those markets this is now telling you on Monday it's a good idea to book your profits on those trades so just a heads up before Monday I will be looking at booking profits in the New Zealand Yen trade we looked at during the week and that's because of the Japanese Yen weakening in the scorecards so we do have a signal here from the Yen which is basically saying if you were a long Japanese Yen last week you should be looking at covering those positions heading into next week because they're not the best players anymore and instead what I would like to look ahead to in this week I would like to look primarily at the Aussie dollar and New Zealand dollar and the Aussie dollar has weakened in the scorecard so we have a sell signal here from the scorecard saying start to look for short opportunities in Australian dollar pairs and although the pound has strengthened it's still on the weak side of the scorecard so if I am going to go short the Aussie I am going to go short the New Zealand I would favor those against primarily the dollar I'm also going to be interested in looking at the Aussie and New Zealand shorts next week vis-a-vis the Frank and I'm also going to be interested in short Aussie and short New Zealand versus the Euro and that actually sets up quite nicely because the Euro and the dollar obviously move in different directions so there's a very good chance that you get opportunities either in Aussie New Zealand dollar versus the Euro or the dollar next week and in fact you could very well see opportunities in both of those markets and all of those markets so as I say Yen pairs are off the table for me for this week they are absolutely neutral and slightly weakening and that really leaves the final currency here which is the Canadian dollar which is slightly bearish to neutral at -1 because this is bearish to neutral this is bearish this is strong bearish and this is oversold but because of the recent rally in oil we had the production cuts from the OPEC meeting last week although I am interested in just keeping an eye on Canadian dollar shorts versus the dollar the Frank and also the Euro they are not going to be highlighted as my top markets when we look at the markets in a minute and I do favor Aussie and New Zealand shorts over Canadian dollar shorts next week okay so let's have a quick look at the individual currencies before moving on to the markets and the top markets that I'm looking at trading next week starting with the dxy it is the only currency which is in a bull market and we are still above the major breakout level of the 102.992 technically we're still making high highs and higher lows and I do have a fundamental bullish bias on this because of the macro driven data we just looked at the one month forward looking probability scores for the dollar which is strong so the despite that I am looking for further advances in the dxy and I do still think we could be heading towards the 121.02 in time I laid that out for you in the dxy breakout thread back at the beginning of the year you can view that thread in the description of this video If you so wish it's on Twitter but just bear in mind we do have CPI data on Thursday and a bank holiday on Monday so this Market is unlikely to do anything on Monday Tuesday Wednesday I would not be surprised to see this correct and then begin to move on Thursday when we get the CPI data so just bear that in mind with the dollar next week I am bullish overall but you can't ignore the CPI data on Thursday next is the Euro we are still below the seven year breakout and the four-year breakout and this thing is still trending to the downside and all we've seen so far is a correction in an oval downtrend so I am looking for any kind of pullback perhaps before CPI and overall further declines from the downside in the Euro you may be saying to yourself well why would you look at Euro New Zealand and Euro Aussie then well because relatively speaking I do think that the New Zealand and the Aussie are still going to underperform the euro you can see the Euro falling like this or selling off and if the Aussie or the New Zealand sell-off at a faster rate you will still see Euro Aussie rallying to the upside and you will still see Euro New Zealand rallying to the upside so don't lose sight of the fact yes the dollar is really the only Market which is currently trending to the upside and therefore I do favor a dollar long plays but you can still make money on for example New Zealand Frank Aussie Frank and Euro New Zealand Euro Aussie it's simply on the basis that one starts to decline or Falls faster than the other next is the pound all we've had in the pound is a flash crash and a retracement that pretty much happens all the time go and have a look at the Swiss franc shock in 2015 it took many years to get back there but we still had the flash crash and then the correction and then it started to roll over so I do favor further declines in the pound maybe again if the dxy corrects we come back up maybe even we test the highs once more but I am looking for the declines and I do think we come back down to the lows and onto the 1.0304 this month next is the Swiss franc now again compare this to the New Zealand and the Aussie when we look at it yes it's bearish yes it's in a downtrend and I certainly wouldn't go long the Swiss Franc versus the dollar but you can see it's kind of grinding to the downside we're hitting the lows we're lacking momentum here and on a one month forward-looking probability basis on the macro scorecards it is telling us to be long the Swiss franc relative to other currencies so I do favor Swiss franc long plays but bear in mind this is not an outright bullish currency next is the Yen now this is a very good example of what I was talking about the scorecards told us to be bullish on the end last week and despite the fact that Yen actually declined there were still good trades to be had like Aussie and New Zealand Yen last week because relatively speaking the Aussie and New Zealand underperformed so the scorecards nailed that but they're telling us this week leave the Japanese year and it's neutral and if anything it's neutral and getting slightly weaker maybe this is a trade for the back end of the month but as it currently stands next week not interested in Japanese Yen next is the cad I am bearish on the cad and as you can see we may get a little bit more of a correction but I am looking for further declines down to the lows and then on to the 0.7088 so I am interested in looking at CAD short setups US dollar CAD to
the upside CAD Frank to the downside eurocad but they're not my favorite positions I would prefer to short Aussie and New Zealand next week Aussie dollar we are trained into the downside still and this is one of my favorite markets to be looking at in the Forex complex next week any pullback in the Aussie I do think we're heading down to the 0.62 150 and as I said a number of times it is one of my favorite shorts next week and the final Market here we're looking at is the New Zealand dollar now the interesting thing about this is and I'm looking at this on a weekly chart because when we look at the individual currencies we're just trying to get an idea of the bigger picture I am looking for the declines in this market but if we come down to the next Target at 0.54660 this is actually a major breakout to the downside in the New Zealand dollar so here is the issue I have with a number of people talking about a potential top in the dxy just like with the pound and the Euro when they broke their major structural lows they started to accelerate and the dollar rallied and we could find this is the case with the New Zealand dollar once we break the 0.5466 so all of this is pointing to near-term advances in the dollar and especially versus the Aussie and the New Zealand and potentially the cad those are where I think the best opportunities are going to lie not just next week but probably for the rest of the month okay so let's look at the markets themselves starting with crude oil and crude oil did rally last week and I warned in last week's video we had the OPEC meetings coming up on Wednesday last week and OPEC plus as it now is with Russia involved discussed potential production cuts and this has caused the crude oil Market to Rally heading into next week I am not outright bullish on crude oil I'm just kind of near-term bullish you could say bullish to neutral because GMT members will know crude oil is not positive in the commodity scorecards but it is weak and getting stronger so it's essentially given us a signal to cover our shorts in fact before the OPEC meetings we got a signal to cover our shorts from the commodity scorecards so I do expect further advances in crude oil but my point is we may struggle to get above the 98.04 so any pullback in crude oil is a near-term potential opportunity to look further advances into the 98.04 and because we have a little bit
of near-term strength in crude oil and the fact that the Canadian dollar only scores minus one in the one month forward-looking probability macro scores that does cause me to leave the Canadian dollar shorts out of my top pairs you can see the top pairs are highlighted in gold and although I'm going to be keeping an eye on them those two reasons specifically are why the cad pairs are not highlighted as best markets to look at next week okay so the First Market we're going to look at here in the Forex complex is New Zealand dollar and this is my favorite short heading into next week we have already had a consolidation and we actually just broke a double top reversal in New Zealand dollars so what I'm looking for head into next week is any pullback and I will be looking for shorts before the CPI data but just bear in mind if it just corrects into the CPI data you know why but any pullback in this market next week any kind of Bear Flag pattern here would be fantastic and that would give me the opportunity to start to look for shorts into the 0.5473 so that is my favorite Market heading into next week I think it's one of the best places to look to make money but just bear in mind with the all of the dollar pairs here we have that CPI data next is Aussie dollar also just breaking out of a near-term consolidation in fact with members we looked at potential shorts in this area last week alongside Aussie and New Zealand Yen we've already started to break down so if you weren't involved from last week any pullback in this area is going to be the opportunity next week start to look for shorts once again into the next key of support to the downside of the 0.6214 next is US dollar CAD now for reason to discussed this is not one of my favorite markets I do prefer Aussie in New Zealand but it does look like we're going to take out the 1.3850 so any pullback in this area can still be considered a potential opportunity to look for long setups into the 1.3850 and the final dollar pair we're looking at here is euro dollar they both score positively on the scorecards and they did last week as well and in fact you can see since the Euro and the dollar have been on the positive side of the scorecards euro dollar has just been ranging it's just been correcting and that is why we avoid generally speaking two strong currencies or two weak currencies if they have a one month forward-looking probability score because those markets over the course of the next four weeks are projected essentially just to correct and range so it's not generally speaking where the opportunities are but if you are looking to trade this Market I would favor short positions still because the dollar is outperforming or is projected to outperform over the next four weeks in the scorecards so any pullback in this market and I would not be surprised to see this correcting into CPI but any pullback would be viewed as an opportunity to look for shorts into the 0.9413 if I'm going to short currencies versus the dollar next week I would much prefer these two next is New Zealand Frank we are breaking out of a near-term correction and it does look like now we are starting to break out of here with momentum so any pullback in New Zealand Frank next week is setting up as a potential opportunity to look for shorts down to the next key of support to the downside at 0.5424
next is Aussie Frank this is my fourth favorite setup heading into next week and again you can see we've kind of been consolidating here which is great because once you have consolidation that's when you usually get a nice payoff with momentum then the consolidation then the payoff and it's actually between the consolidations where where most of your money will be made so I like the fact this is Consolidated hasn't really gone anywhere since all the way back here but now we are starting to potentially break out and the scorecards are telling us it's projecting potential further weakness in the Aussie pairs because we went from -1 to -2 so it's given us essentially a sell signal in the Aussie pairs look for shorts in those markets so going into next week any continued pullback in this market or if we can start to break down from here because as I see here we do have probably on the one hour time frame but we have a kind of descending triangle pattern you can see this it's a cell pattern so any kind of pullback is viewed as an opportunity to look for sure or if we start to break down out of this consolidation look for a pullback and a correction towards the bottom of this pattern and that would be your opportunity to look further declines into the 0.6208 and the final Frank pair here is CAD Frank we are also consolidating you can see we're kind of stuck in a Range here but any breakdown in this market is still viewed as a potential opportunity to look for shorts into the 0.7061 as I said I will be keeping my eye on the cad pairs but for reasons discussed I would rather short New Zealand Frank and Aussie Frank over CAD Frank next week and the final Forex pairs we're looking at here are the Euro pairs we do have a nice consolidation here so any continued correction next week in Euro New Zealand is viewed as an opportunity to look for bullish breakouts into the 1.7663 next is your Aussie and this is six out of six this is my final Top Market that I'm going to be looking for trading opportunities in next week in the Forex complex and any pullback in this market I'd like to see a bit of an ABC come down test the lows that's going to be a great opportunity to start to look for bullish reversals I'm going to be looking up towards the 1.5515 so those are my top six Forex pairs that I'm going to be looking at trading next week and last but also least in this case because 0 is my least favorite Forex Market out of all of these I am still looking at a potential further advance in eurocad again maybe next week if crude oil heads higher it just continues to consolidate maybe this is a trade for the back end of this month but any continued correction in this market is still viewed as an opportunity to look for bullish breakouts I'm going to be looking up towards the 1.3715 okay so wrapping up the video with gold silver Bitcoin and also we're going to look at
the S P 500 in U.S stocks the gold silver ratio did come down to the Target highlighted at the 82.08 as it stands I am looking for the declines in the gold silver ratio so I do think gold is likely to underperform Silver but when we look at Silver and Gold I do not have a strong bias on these markets and I'm going to explain to you why okay so starting with gold and and I'm looking at gold and silver this week on the daily chart because we need to have a bigger picture view of what's going on we broke below the major low here of the 1676.86 and with the rally on Monday which we had from us pmis remember the manufacturing PMI that came out worse than expected but still above 50. that was when we saw this big rally Above This previous low and we haven't really gone anywhere in Gold since then the big problem I have with gold though and getting involved for example with gold long positions here is that one the dxy is still bullish two the dxy still has a one month forward looking probability score three gold is still in an oval downtrend you can see here is simply a low here is a lower high here is a low here is a lower high so I wouldn't want to get involved in Gold just yet in the face of a projected stronger dollar I would imagine we're probably going to come down and make new lows still in Gold but it's not a fantastic shot either because we're above the 1676.86 so going into next week I am neutral on gold if you are looking to get involved what I would say was I wouldn't be surprised to see us come back and retest maybe have a bit of a false breakout above here kind of inverse Head and Shoulders false break and then start to roll over again so I'm being patient next week on gold I am bearish overall but not a great week in my opinion to either get long or short gold next is silver now also with silver just as gold I do think patience is required on both of these markets however silver paints a little bit of a clearer picture because this was the major breakout level highlighted and left here in gold at 21 4230 and we have not yet broken above here so going into next week especially as I do think we have further upside in the dollar over the next month and potentially over the next quarter I think what we're most likely to see is probably one more up and a retest of the major breakout level in silver and this is where I'd be starting to look for silver to roll over but again next week with gold and silver I'm more in an observation mode I'm not really going into next week with a strong bullish or bearish bias on gold and silver I'm bearish overall but next week I'm going to be waiting to see how they play out and if we are going to start to get further declines for example in silver after a retest of the major 21.4230 breakout level next is Bitcoin now Bitcoin
is a market that I'm interested in looking for shorts next week and I do think we are about to start the next leg down in Bitcoin again I'm looking at this on the daily chart because if I look at this on the four hour chart all you see is this big correction so I kind of want want to have a bigger view here we broke below the previous low we sold off and we've been in a correction ever since we bought them down here I do however think after this consolidation and this failed attempt to break Above This ascending triangle I do think this is likely the start of the next leg down in Bitcoin and I am looking to be short Bitcoin heading into next week finally I think we're going to come down to the Target that's been highlighted for a while here at 16 492. okay so wrapping up the video with the S P 500 because it's very important to be keeping tabs on what's going on currently in the S P 500 I have been warning on YouTube in previous videos and also on Twitter that there are alarm bells ringing that we could be facing now a stock market capitulation in this quarter of this year so Q4 of 2022 and on the first two days of last week Monday Tuesday we had a big bounce many were comparing to April 2020 and I was warning this is not April 2020. this is October 2022 and the difference between the monetary policy of April 2020 and now is literally almost the opposite in April 2020 the Fed was pumping money into the economy at an extraordinary rate and now they're doing the opposite they're tightening at the fastest rate in history so I did warn about this two-day bounce and in fact myself and GMT members during the daily videos in the week we were looking to short this and fade this and it has worked out very nicely but we are now approaching the previous low which was set at the end of last month why is this significant because with such a large amount of buying coming in on Monday and Tuesday a number the vast majority of those buyers are going to be looking to exit their positions below this previous low and if we do come down especially if we break that low on a hotter than expected inflation print next Thursday this could very well proceed quite a strong sell-off to the downside in the S P 500 and that is going to bring a risk off sentiment into all of the markets overall and especially when we look at say New Zealand and Aussie dollar to the downside New Zealand Aussie Frank to the downside Euro New Zealand you're Aussie to the upside and even Bitcoin to the downside all of those are markets which would benefit from a risk-off environment so extremely important to keep an eye on this heading into next week this Bounce has not yet failed but it is very close to failing and if those buyers as usually is the case on the mechanics of a breakout start to scramble to exit their positions below the previous low you will see likely quite a strong sell-off in the S P 500 once we break these lows so that is it for me for this week guys as always I hope you enjoyed this video and if you did please let me know by liking sharing and subscribing a big thanks to everybody who does that on a regular basis and a big thank you to everybody who has subscribed to the channel so far if you enjoyed today's video why not consider joining us during the week where I share my charts as well as the setups that I'm personally looking at trading with members on a daily basis and we also published the scorecards for over 75 markets in different asset classes including Forex stocks bonds and commodities you can find out more about the benefits of GMT membership by clicking the links in the description below and also in the pinned comment below so thanks for watching the only thing left to say is take care and don't get straight safely foreign
2022-10-13 17:20