Weekly Forex Forecast (15/08/22) EurUsd / XauUsd + Forex Trading Plan! [HD]

hey traders it's john fortune here with this  week's weekly forex forecast i hope you're having   a great weekend we are in today's video going to  revisit the u.s stock market why because it has   reached a decision point it's decision time for  the u.s stock market and i'm going to show you in   today's video exactly how close current market  conditions are to that of 2008 and the great   financial crisis and the crash which followed  okay so quick look first at the economic calendar   because last week was dominated by this cpi print  on wednesday out of the us and because it came in   lower than forecast and also lower than previous  the market took this as a view that 75 basis   points in the september fomc meeting is now likely  off the table and they essentially priced in   50 basis points and we saw the knee-jerk reaction  initially in the dollar selling off and that   caused actually other markets to move and even the  new zealand dollar with some unexpected strength   from this piece of data which we're going  to look at in today's video and we also had   last week consumer sentiment coming out which was  better than forecast better than previous but 55.1   is actually back at 2008 levels and is not overall  a very strong reading for consumer sentiment so   better than forecast better than previously  but actually historically very very low still   and a couple of key things to note coming up for  this week is we do have some inflation data out   of canada but the first real important piece of  data is the new zealand interest rate decision on   wednesday you're likely going to see the markets  correcting not doing much in terms of the new   zealand pairs into wednesday and as you saw last  week and i constantly say if you hold positions   through these interest rates or through these  major news events you are taking more risk   because the market gets more volatile so by  definition more volatility equals more risk   if you're holding positions through them so you  can either trade around them or if you want to   be safer you want to take less risk wait until  these interest rate decisions or the news events   pass and then look to trade in that direction if  it fits your plan which you've previously worked   out so we do have an interest rate decision out of  new zealand on wednesday i'm going to be looking   at the new zealand pairs next week but they will  be from wednesday onwards so i'm going to wait for   the interest rate decision to come out and then if  they move in the direction we are planning today   i will look to trade them and we also have cpi  out of the uk now this is likely also to cause   volatility and don't be surprised if the pound  pairs kind of do nothing into wednesday if they   kind of correct and don't move into wednesday that  is your sign that the markets are likely to get   very volatile on wednesday itself so again you've  got three options you can trade around it you can   actually trade after it or if you want to hold  through it just be aware you are taking more risk   okay so let's look at scorecards heading into  next week and the first thing of note is that   the u.s dollar and the euro are both negative so  when you have both the us dollar and the euro on   the positive side or both of them on the negative  side as i said many times previously this shows   that market opportunities are less abundant and  it just means you should take down your risk   somewhat doesn't mean you don't have to trade i  am still going to be looking at trading and we're   going to go through the best opportunities that  i see next week in this video but it does mean   that market conditions could be better and there  will be a time in the near future when there are   many more market opportunities available so that's  the first thing to note maybe take down a little   bit of risk going into next week the second thing  to note which is interesting was the net change   of two in the new zealand dollar taking it from  minus one to one now why was this interesting   well because this was a very rare occasion in  the scorecards because the previous week so   not last week but the previous week before that  the new zealand dollar was already at plus one   and then to get to last week's score of  minus one we had a net change of minus two   and then we had exactly the same change the  following week in the opposite direction so   we had really a whip saw here in what we were  looking at in the scorecards and that is very   very rare because the scorecards themselves are  built they're designed not to get you whipstored   because there's no use having something go up  and you say it's strong and you buy it and then   it whipsaws down and then you sell it and it  goes the other way so they're designed to avoid   whipsaws this is why we don't really see them very  often and in fact the only thing that can really   cause this in the scorecards is a significant  economic event like the cpi data we had last week   why the new zealand dollar was especially  responsive to that to the upside i don't know if   anybody has any ideas on that let me know in the  comments what your thoughts are because i still   don't know why the new zealand outperformed  so much compared to the other currencies   when the us dollar sold off last week but either  way the fact is it did and going into this week   this does mean i am interested in new zealand  long plays which we're going to be looking at   but with the interest rate decision on wednesday  they're going to be from after wednesday so if we   get the new zealand dollar rallying on wednesday  i'm going to be looking for follow-through trades   to the upside wednesday thursday friday and the  final third and very important piece to take away   from the scorecards is the pound going from minus  one to minus two when we have a currency scoring   on a one-month forward-looking basis weak and it's  getting weaker or if we have a currency which is   strong and getting stronger on a one month forward  probability basis those are the best signals so   pound shorts absolutely are going to be a primary  thing i'm going to be focused on this week and i'm   primarily going to be looking at pound yen to the  downside we're going to be looking at pound franc   to the downside we're also going to be looking at  pound new zealand and pound aussie to the downside   and then after the pound i am interested in euro  shorts as the second worst scoring currency and   again we're going to be looking at euro yen to  the downside you're frank to the downside euro   new zealand to the downside and euro aussie to  the downside okay starting with the individual   currencies just to get an idea of what's going on  on the daily chart and we're starting with the dxy   the dxy sold off over here on the 10th as you  can see when we had that cpi reading and it   really just corrected pretty much two-thirds  of the move maybe you could say 50 of the move   after that so the dollar index has been  in a correction since the july 14th peak   and nothing has really changed as of last  week that did not break the correction it   did not reverse the dxy to the downside and  in all probability whenever this correction   resolves itself a new high up above the previous  high possibly into the 109.76 is still the most   likely probability however as you can see in the  scorecards they're telling you the dollar is kind   of neutral and it's not yet time to jump in and  be very bullish on the dollar but as you can see   quite clearly here not only are we still above  the 102.992 which was the seven year breakout the  

dollar uptrend bull market is still intact next  is the euro and again we're on the daily charts   here and have a look at the euro now doesn't this  tell you a bit more of a story than what we just   looked at in the dxy because don't forget these  two markets are like going to move in the opposite   direction almost certainly and you can see here  we have two levels on here i tweeted about this   previously with the euro and the breakout level  of the 1.06710 is the four-year breakout level   and the 1.03750 is the seven year breakout level  all we have done so far in the euro which again   mirrors the inverse of the dxy is to pull back and  retest the seven year breakout the first sign that   we may be getting a bigger reversal in the euro  would be if we broke with momentum above the 1.3  

or zero three 750 sorry which we haven't got just  yet but even then we may only be coming back to   retest the four-year range breakout you would  have to have a real clear momentum break above   the 1.06710 for this to start to be considered a  possible inverse head and shoulders and a major   reversal this as it currently stands is a very  bearish chart and i am looking for the declines   in the euro vis-a-vis the other currencies that  we're going to be looking at next week next is the   pound we did previously have and i mentioned in  last week's video the bank of england projecting   the uk economy going into recession at the end  of this year the fourth quarter and being in   a recession all of next year five consecutive  quarters that is not good for the currency they   have to ease the currency weaken the currency in  order to stimulate growth and so fundamentally   the pound does have a very bearish bias overall  and in terms of what we've seen recently again   this is just as it currently stands a correction i  am looking for declines and pound shorts as i said   along with euro shorts are my two favorite plays  to the short side heading into next week next is   the swiss franc now we've been bullish on the  swiss franc it's been on the best long side for   a few weeks now and it has paid quite nicely the  only swiss franc pair which didn't work last week   was the new zealand swiss franc because we had  that massive rally in the new zealand dollar from   the cpi data we did take out both targets to the  upside in the swiss franc any correction in this   market is simply viewed as an opportunity once  again to look for bullish setups but just bear in   mind in the scorecards it is actually weakening  and for that reason i've left the swiss franc   pairs on here because they are bullish but they  kind of go to the bottom of the list this week   because that is really what the data is telling  me to do but swiss franc long plays in the form   of euroframe to the outside pound franc to the  outside are still going to be opportunities i'm   going to be paying attention to but i prefer these  other currencies vis-a-vis the yen the new zealand   and the aussie next week next is the japanese  yen now the japanese yen is currently bullish but   as you can see and i mentioned this in previous  videos one of the problems is that this is just   a counter trend move and we're probably coming  back maybe even to re-test the major breakout   of the 0.0079 so yes i am bullish on the yen and  the scorecards are telling us to look still for   yen strength i'm going to be looking at pound y  and yuri into the downside next week but i kind   of would prefer to be long on the dollar if the  dollar can start to break higher and break out of   the correction because the dollar is in an overall  bull market so i prefer dollar longs but right now   going into next week i do still favor japanese  yen long plays next is the cad we actually broke   out of an inverse head and shoulders here in the  canadian dollar but it's not particularly strong   it's kind of neutral and so overall we are kind  of in a range but because we broke out of this   and because the scorecards themselves are telling  me that they're kind of neutral on the cad   i really don't like cad pairs going into next week  it's a week as i said to take down a bit of risk   and so i really want to be focused on what looks  like the best opportunities and i don't think   that's cad pairs next week next is the aussie  the aussie has been kind of bullish to neutral   in the scorecards for a while and we did last  week break out of an inverse head and shoulders   and this looks to be even the right shoulder of  an even bigger inverse head and shoulders it does   look like we're going to come back and test the  neckline here at the 0.72805 so i do like aussie   long plays heading into next week and as you can  see euro aussie to the downside and pound aussie   to the outside are two markets i'm really going to  be paying attention to next week and last but not   least the new zealand dollar we had a huge spike  off of the uscpi print the only thing i can think   of is that this outperformed to the upside because  traders last week put money into the new zealand   over and above other currencies last week because  they wanted to invest prior to the interest rate   hike this week apart from positioning around and  prior to the interest rate decision this week   out of new zealand i can't really think of  any other reason why this would outperform   so much to the upside you might say well it's  one of the more volatile currencies but then   the aussie usually outperforms the new zealand in  that scenario which it didn't last weeks so that   suggests it's something very specific to the  new zealand which caused this rally last week   and not just the fact it's a volatile commodity  currency but either way this is where we currently   sit next week we traded into the previous high  over here and this is actually a key area of   resistance and as always this happens very often  with markets they get into a position where they   can go either way ahead of major interest  rate decisions so we could see a break higher   like this on the interest rate decision and we get  this kind of double bottom or the new zealand is   in place to actually reject from the resistance  area and come down like this and this is why next   week it's going to be preferable to wait for  the interest rate decision to take place first   and then look to take trades based off of  that because of what we're looking at in   the scorecards my primary bias is to the long  side that's euro new zealand to the short side   and pound new zealand to the short side so what i  would like to see heading into next week i would   like to see from wednesday the market correcting  perhaps like this and then breaking higher   on wednesday and any pullback like this would be  your opportunity to look for follow-through trades   in the new zealand pairs so again highlighted in  blue because we have a news event next week don't   forget okay so let's have a look at the markets  next week starting with euro dollar i do euro   dollar every week but i'm not really looking at  trading euro dollar next week why because i have a   strict process which i adhere to and the euro and  the dollar are both weak they're both bearish in   the scorecards on a one-month forward looking  basis when that changes i'll get back involved   in eurodollar but you can see here really  just mimicking what we saw in the euro index   we have pulled back and retested as a bear  flag the major 7-year breakout level of 1.03434   just looking at the technicals here i would say  this is probably now the top maybe we come up and   re-test it once more but this looks to be more or  less the top in euro dollar and we've also pulled   back and re-tested this previous low which is  the black line that was the low we broke with   momentum and then we pulled back correctively  and tested so i do think just as higher highs   is the higher probability in the dxy towards 109  i do think lower lows is the higher probability in   euro dollar but i would rather just get a little  bit of a momentum breakout first no need to try   and top tick this i'd rather be a bit patient  on eurodollar before i look for those shorts   okay so dropping down onto the four-hour chart  here to look at the rest of the markets i am   interested in crude oil shorts to the downside and  last week we're very close to target and i said i   wanted to see this market really correct to get  more risk to reward on the trades into the 87.73  

so any pullback is still simply viewed as  an opportunity to look for bearish reversals   bearish breakouts i'm going to be looking down  towards the 87.73 and if we can break through here   down towards the 84.49 so the first forex pair  here is pound yen now i've highlighted in blue   the pound pairs and the new zealand pairs the  new zealand pairs i am not going to be trading at   all until wednesday onwards the market in the new  zealand dollar is most likely going to do nothing   between monday and wednesday so the probabilities  are if you get involved even in short-term trades   you're probably going to get chopped about monday  to wednesday but the pound pairs because it's an   inflation print slightly different we can see  those markets moving monday tuesday wednesday so   it's important to separate these two because i  am going to be looking at potential short-term   trades in the pound pairs before wednesday but not  in the new zealand pairs which have an interest   rate decision so going into next week i actually  wouldn't be surprised to see pound yen selling off   pretty much from the get-go why because we already  have a bearish reversal here see how we broke down   and we started to pull back and re-test this i  would not be surprised to see this coming down   taking out the lows maybe even into wednesday  and then maybe on wednesday we get a reversal   some profit taking so i am going to be looking  at schwartz in pound yen first of all as i said   down to the previous lows and then on to the  158.07 again don't be surprised to see this go   pretty much off the bat from monday to wednesday  next is euro yen also another market i wouldn't   be surprised to sleep go pretty much straight  away next week we have a very mini in the one   hours i think this is a double top over  here and this is actually the overall head   of a downward sloping head and shoulders which is  when you get downward sloping head and shoulders   you are more likely going to get a strong  momentum move to the downside and if you have   upward sloping inverse head and shoulders you  are more likely to get strong momentum move   to the upside as opposed to say downward  sloping head and shoulders like this   or inverse head and shoulders if you're looking  to the upside and in this case as opposed to if   you have upward sloping head and shoulders like  this so i am looking for the declines and again   don't be surprised to see this pretty much  go from monday maybe even into wednesday but   pound yen and euro yen are two of my top plays  heading into next week based on what we're looking   at in the scorecards if you are shorting pound gem  before wednesday and you hold through wednesday   don't be surprised if it whipsaws or profit  taking comes in and again you are taking a   risk if you hold through the news next is pound  aussie this market is very strong to the downside   we have huge momentum don't be surprised  to see this market correct first perhaps   into wednesday because you have a strong move you  often need a little bit of a stronger correction   but any pullback in this market and a pullback  really would be fantastic and i would prefer to   see a pullback first perhaps into wednesday any  pullback is going to be viewed as an opportunity   to look for shorts in this market down to the  1.6918 nexus pound new zealand now because it's   a new zealand pair as well as a pound pair i would  definitely be waiting until wednesday or after   wednesday to trade this because you have two big  pieces of data coming out on wednesday and this   pair could get quite volatile but you can see we  broke and what was i just saying in the previous   charts we were looking at downward sloping head  and shoulders and what did we get we got a strong   momentum move a bigger sell-off than if you would  have just an upward sloping head and shoulders   so what we're seeing here think back to maybe  pound yen which you could be seeing next week   or in the coming weeks but any pullback in this  market it'd be great if this pulled back into   wednesday like this and then on wednesday we've  got a breakdown like this we've got momentum in   the direction of the trend that would be fantastic  i'll be looking at shorts into the 1.8732  

next is euro aussie now i really like your aussie  next week because we don't have a news event   in this market at all we don't have pound  we don't have a new zealand in this so   any pullback we've broken out of this correction  here we're now starting to trend to the downside   any pullback will be an opportunity next week  in my opinion a great opportunity to start to   look for shorts and i'm going to be looking down  towards the 1.4329 and when we break through here   there is nothing but air down to the 1.3987 it's  probably not going to do that in a single week   because it's a huge distance but we could cover  this ground quite quickly perhaps over a couple   of weeks if you want to take a more conservative  target take the psychological level of the 1.42   which is more or less between those as a kind of  medium-term target but i really like your aussie   next week euro new zealand the best thing that  could happen with euro new zealand is that this   corrects into the interest rate seasonal wednesday  if this starts to correct into the interest rate   decision i'm looking for the break on wednesday  into thursday and any pullback is then the   opportunity to start to look for shorts all the  way down to the next key of support at the 1.5594   next is eurofrank this was a market i said to  look for shorts last week and this was a great   performing market this was a really really  good market we had a big sell-off last week   we just missed the target at 0.9577 now this  chart is a little bit of a worrying chart  

for the euro if i zoom out here into the weekly  chart look at where we are in eurofrank we are   right at the bottom of the 2015 frank shock  if we break this level and the target we are   just about to take out which was last week's  target is the low of the 2015 swiss franc shot   if we take out this level i have no idea what  is going to happen to eurofrank to the downside   we could very well break with momentum and this  could actually turn into a bit of a problem for   the euro when you combine this with what we've  been looking at really all year with the dollar   index and i've put the dollar breakout thread in  to the weekly forex forecast videos on twitter   that you can follow or have a look at you can  see that in the comments or in the description   but when you compare this this is really pointing  to a serious issue for the euro and when you get a   currency at all time lows or if you get any market  really at all time lows or you get a market at   all-time highs a market at all-time lows is not  a buying opportunity it's a selling it's a short   and if you get a market all-time highs it's not  selling opportunity it's a buying opportunity   so this is something which could spell  a little bit of a problem and especially   if you compare this is now two currency markets  with the euro where we could be at the point of   major breakdowns because euro dollar we've broken  the seven year range pulled back and retested   and in euros swiss franc we're about to break  the major low of the 2015 swiss franc shock   i'm absolutely bearish on euro swiss franc and i  wouldn't touch this to the long side with barge   poll and the final forex pair is pound frank this  was a market we're looking to the short side last   week and this was another good short we took out  the target and we've broken through this i've been   saying in recent videos that once we took out this  target and we broke this low there is nothing but   air between the 1.1119 and we could come down here  pretty quickly and we saw some momentum coming   into this so any pullback in this market is views  an opportunity to look for shorts if you want to   take the psychological target of the 1.1300 as a  kind of medium-term target you can but the next   key of support to the downside is the 1.1119 and  when you compare this to what we just looked at   in eurofrank we could be seeing quite a strong  appreciation of the swiss franc in the near term   and in fact it may cause the smb to step in and  intervene so just be prepared about that but what   i'm seeing here in pound frank and eurofrank is  potentially a little bit worrying okay so wrapping   up the video with gold silver bitcoin and then  we are going to finish with the u.s stock market  

and why i think it's decision time and how closely  the u.s stock market resembles the 2008 financial   crisis so having a quick look starting with gold  i'm on the weekly chart here don't usually look at   these markets on the weekly chart but because the  dxy is kind of neutral i am not really interested   in gold silver and bitcoin next week i would  like to see the dxy either being very bearish   or pretty bullish and then that will give me a  better bias on gold silver and bitcoin so i'm   personally sitting out these markets i do think  they could come a little bit higher because the   dxy correction is not yet over maybe it comes down  a little bit lower first but the point of looking   at this on the weekly chart is just to show you  i view this as a counter trend move currently   and the reason i don't want to be long even if  this goes a bit higher is because a it looks   like the dollar could turn pretty much any day or  any week and if it does that that's going to put   downward pressure on gold silver and bitcoin and  at the same time we're just retesting the previous   low here and although we're breaking through it  i just think upside is fairly limited so if you   want to be trading gold silver and bitcoin yes  near term we could come up a little bit higher   i suppose i am slightly bullish on these markets  all the time the dxy corrections continuing but   because i think the upside is capped i would  like to see these markets reverse first and then   the better money-making opportunity in my  opinion is for the next decline into the 1676.8   if we look at silver also on the weekly chart you  can see that we broke out of the major breakout   level back here in 21. sorry at 21.42 and we may  just be coming back to retest this so again there  

may be a little bit more upside here the whole  time the dxy is correcting but this is not a   bullish chart i would not like to risk this  reversing and selling off just to capture a   little bit up in this area i'd much rather trade  something like pound yen or pound franc which is   really selling off hard to the downside so  yes this could come up a bit higher perhaps   we re-tested 21.42 but you have the risk of a  reversal if the dxy starts to break out of its   recent correction again you can see really we're  just testing previous lows and finally bitcoin is   also coming up to test the previous low as i  discussed in the previous weekly forex forecast   videos if you remember at the start of the month  what i said to you guys was i think we are going   to see the vix coming down to 1850 and that is  going to provide a little bit of risk on for one   week or so and you can see it's already taken a  couple of weeks we've been seeing a bit of risk on   but once we start to take out these lows and  we're sitting there in gold and silver and i   think we come up and test the low in bitcoin i do  think we are then at risk of seeing these reverse   to the downside and that is when i'm going to  start to be looking short and what those two   weeks of risk on or one week of risk on now been  two weeks is likely to do is paint the upper wick   of the monthly candle and that is what i  think we're seeing here so far we've got this   and i think the risk is for the rest of the month  to come down like this okay so i want to leave you   with this because this is very important but i'll  keep it quick because of time all the way back in   may i posted a thread on twitter about market  sentiment to say that the market sentiment in   this current bear market is actually very similar  to 2008 because a lot of people at the time were   saying that it's a contrarian signal sentiment's  very bearish so therefore we should buy the   market but that actually is a misunderstanding of  market sentiment market sentiment is contrarian   but not at extremes if you have extremely negative  sentiment that actually is usually confirmation   of a major top it's not contrarian at the absolute  extremes so the market sentiment since the   beginning of this bear market has been mirroring  that of 2008 compared to other drawdowns in the   markets now if we look at how this has actually  unfolded this is also extremely uncanny the way   the market itself has played out in comparison  to 2008 you can see here in the spx we have   one move down two three four and then we have  a fifth and now we have come back to test the   high of the previous fourth wave over in this  area if you look back to 2008 that decline is   almost a mirror image of what we saw in 2008 down  into the late summer lows then we had the rally   taking out the top of the fourth wave in 2008  and that is exactly where we currently sit   in the spx and in 2008 that was the point at which  the market started to roll over and from peak to   trough in 2008 was about a 20 decline the peak  to trough of this market's decline is about 24   we then took out the high of the fourth  wave and then we had a capitulation in the   stock market which took the overall market  down to a decline of -54 from the peak so   it's very interesting to note that sentiment  matches 2008 and has done all the way since   the beginning of the bear market and price  itself matches the initial stage one decline   of the s p 500 in 2008 as well and in previous  videos i highlighted the 1845 or the 1850 of   the vix i said i think we're going to come down  into the 1845 we'll probably see a week or so of   risk on as this happens and then we could run  into some serious trouble why because at the   same time now that the spx is taking out the wave  four high which is exactly what happened in 2008   where was the vix in 2008 if we scroll  out the 2008 market crash took place from   you could say between 18 and 19 in the vix  that was where we got the major rally after   a pullback into this level and it just seems very  uncanny that all of these things are lining up so   is the market in the u.s at risk of capitulation  and of course if the market were to capitulate in   the u.s that would be a global market capitulation  other markets would go as well well the problem  

is a lot of people are pointing to the u.s  economy and saying no the fed really isn't   breaking anything because consumer sentiment's  improving the labor market is quite strong   and all of this is actually fairly true although  the labour market is one of the last things to go   the us economy isn't actually doing that bad so i  just wonder maybe we are overlooking something and   maybe there is a serious risk here of capitulation  in the market but maybe the issue is not   going to come from fed tightening maybe this time  it comes from elsewhere and that could be china so   keep an eye on this as the market trades into 1845  i'm not saying there is 100 going to be a crash   i'm just painting the picture that i see based on  everything that is taking place now and compared   2008 and the reason i say this is decision time  is because not only is the vix at the level   which caused capitulation in 2008 but the market  itself is at the exact same resistance area you   could say at the wave 4 high which saw the 2008  market capitulate as well so that is why i say   this is in my opinion decision time if we break  the 1845 to the downside we're probably heading   down to 1189 and that would see all-time highs in  the s p 500 and you would see the market breaking   cleanly through maybe it comes back and re-test  the waveform high and continues but if the market   starts to bounce at 1845 and i'm talking about the  vix here and at the same time the s p 500 rolls   over from that wave 4 high and starts to sell off  we could have a problem in global stock markets 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 thank to everybody who does that on a regular   basis and i want to wish you all a fantastic  weekend and i want to wish you all the best   in your trading next week the only thing left to  say is take care and don't forget to trade safely you

2022-08-15 03:50

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