Weekly Forex Forecast (23/05/22) EurUsd / XauUsd + Forex Trading Plan! [HD]
hey traders it's john fortune here with this week's weekly forex forecast i hope as always you're having a fantastic weekend last week was a bit of a boring week we corrected in pretty much all of the markets we looked at so in today's video we're going to have a quick look back at last week what happened last week in the markets why it happened and what does it mean coming into this week and when we look at the scorecards today there's quite a bit of information embedded in those scores hidden into next week so with that said let's get into today's video starting with a brief look at the economic calendar because there are a couple of important events coming up we do have an interest rate decision out of new zealand on wednesday so in terms of the new zealand pairs i will only be focused on trading the new zealand pairs that we're looking at in today's video from wednesday onwards because we know statistically you're probably going to get the new zealand pairs doing nothing into this interest rate decision and then the opportunity is likely to come from wednesday into the back end of the week on the new zealand pairs we also have a bit of preliminary gdp dates coming out of the us but because it's later on in the week this is not really anything we need to plan around but that can affect the markets and i think you're going to see some volatility around this but again as i said not something we really need to plan trades around and if we just jump ahead a week you can see we also have coming up not this coming week but the following week an interest rate decision out of canada now last week when we looked at scorecards you'll see we had a softening of the canadian dollar in fact cash drinks relatively speaking was something was looking at last week and it may be the case that the cad pairs continue to consolidate or correct into this interest rate decision now if that's the case the cad pairs are not going to be preferable markets to be trading over the next two weeks because if there's no volatility and they just correct very much like we had last week there's no real trading opportunities in those pairs so just something to bear in mind we will look at the cad pairs but because of this i would not go too crazy with risk in the cad pairs i'd probably only be looking to trade one if a nice setup appears in any of the cad pairs that we look at today so apart from that there's really nothing else we need to pay attention to we do have non-farm payrolls that week as well but nothing we need to pay attention to heading into next week okay so looking at the scorecards heading into next week and there's quite a bit of information here now the first thing to note is that generally speaking the markets corrected last week and when you're looking at the scorecards here we tend to have three outcomes of the scorecards the first is a winning week which is where the markets move in the direction of the scorecards projecting and that happens usually within the week the second outcome is what i would term a corrective week which is where very similar to what we had last week in the us dollar the market doesn't move in that direction that single week however the bias is unchanged and it tends to move in that direction after maybe two or three weeks and the reason for that is just because it engages in a larger correction or it corrects to a high degree or on a higher time frame and the confirmation of a corrective week is or tends to be what we're looking at here which is where the u.s dollar has corrected and pulled back but it retains its score it hasn't actually weakened overall in the macro framework and this is telling us that the probabilities lie with a continuation to the upside in the dollar and we should be treating the pullback last week simply as a better opportunity to get long in the us dollar and the third outcome really of the scorecards is when you have a reversal week or the market or markets change in the opposite directions we're looking at and that tends to be confirmed by what we saw in the swiss franc last week we were kind of bearish and we have now flipped to neutral but you can see the score itself has increased and this is a warning going into next week to say yes we should be still looking to retain that bullish bias in the dollar however in terms of swiss franc weakness we should now be reconsidering that and so swiss franc shorts are off the table for me heading into this week and in fact when we go through the markets themselves because we have some momentum in the swiss franc moving from right to left i am prepared to look at a couple of opportunities namely pound frank new zealand frank and also eurofranc but the slight issue with the swiss franc heading into this week although i'm prepared to look at those markets on a relative basis this week the swiss franc itself as we will see in a bit very much like the canadian dollar we looked at previously it's not strong in and of itself it's just currently strong relative to other currencies the second thing to notice here is that the euro has actually decreased its score from neutral to -1 and we discussed this in previous videos that the fact the euro was kind of neutral and the dollar was strong those two things don't really go to together and one of those has to give and we were kind of preempting in previous videos the euro shifting from a more neutral position down towards a more bearish position and that the dollar strength was going to hold up not the near-term euro strength that has been the case and so again very much like the dollar remaining plus three this just is confirmation going into this week of holding that dollar long by us and continuing to hold that euro bearish buyers heading into next week and the final thing here really to note is that the pound has weakened from minus two to minus three so this is confirmation again even though the pound pairs corrected somewhat last week we should still be holding that short bias unlike the swiss franc and we also had the new zealand dollar weakening however just bear in mind we have that interest rate decision so i'm really only going to trade the new zealand pairs from wednesday onwards so that's really just unpacking what took place last week we actually had a combination almost of a corrective week in terms of the dollar and the pound and also somewhat the euro pairs but the swiss franc pairs are something we should not really be looking at shorting going into this week in my opinion and also potentially even reversing that bias if we get some good opportunities in those pairs which we're going to look at so to summarize here the us dollar pairs are still the best long positions the pound pairs are still in my opinion the best short positions and we should just treat those corrections in those markets last week as a better opportunity to get involved in those and just be patient instead of those markets moving in one week maybe they move next week or they move over the next two weeks and you can also see outside of that there is really less opportunities in the markets heading into next week and this will be reflected in the best pairs highlighted when we look at the markets themselves and you'll see really my main focus is going to be on those dollar strength plays heading into next week okay so let's have a look at the individual currencies first before we move on to the markets next week and start with the dollar you can see the dollar just corrected one two three four five and we actually pulled back to the major breakout level of the 102.992 so as it stands really this is just a pullback and a retest this retest here was so close that this is really just if you look on the bigger picture we're going to look at the weekly in a second but this was more just a candle wick whereas this is more of a pullback and a re-test as it currently stands the macro scorecards are clearly telling us to remain bullish and they've kept us on the right side of this all the way throughout this year but looking at this in the daily chart just allows us to look at the bigger picture you can see quite clearly this is just a near-term correction here and so i think patience is required on the dollar and i do still favor dollar long positions because this market is technically bullish as well as being fundamentally the strongest currency heading into next week and you can see just quickly if i zoom out to the weekly here this was the major breakout level which we started to pull back and re-test and one down candle or one red week does not a trend change make so really just underscoring here that what took place last week was a larger correction back to retest the major breakout level of the 102.992 and i am going to be looking for opportunities to the upside in dxy as my priority and the main place to be making money next week next is the euro the euro also pulled back as we had to pull back in the dx y but you can see this is quite telling the euro itself has still not breached the major breakout level we've discussed in previous videos of the 1.06710 there is no chance of the euro making any major reversal to the upside unless it can get back above the 1.06710 significantly
and as it currently stands that is not the case maybe we come back and re-test this next week but i see no reason to change the bias and in fact when we look at the macro framework we actually had a weakening of the euro and when you have technically a market correcting like this and at the same time the scorecard is doing the opposite the vast majority of the time that market is going to resolve itself in the direction of the forward-looking scorecards so i am bearish on the euro i'm viewing this just simply as a pullback and a better opportunity to look for short positions next is the pound the pound has also corrected and again i'm just simply viewing this as a near-term bear flag and any continuation is viewed as an opportunity to look for a reversal down to the 1.2081 this move down towards the next target will of course be reflected in the pound pairs themselves next is the swiss franc now this is what caused the slight issue last week because we were looking at the swiss franc to the downside however the market because it had such a steep sell-off we had a very sharp reversal this kind of v bottom does not happen very often in the markets so i still only view this as a near-term correction in the swiss franc however because this is so sharp if the swiss franc continues to correct like this and other currencies like the pound do this then you're still going to see markets like pound frank moving to the downside even though when you compare this to say the dollar the swiss franc is not a particularly strong currency in and of itself so this is why i will be looking at some of the frank pairs like pound frank the downside new zealand france and downside eurofranc to the downside on the basis that if we get a continued correction the swiss franc will relatively outperform those currencies but just bear in mind it's not highlighted as one of the best because this is not showing inherent strength like the us dollar is so that's why the dollar pairs are highlighted in gold as the best pairs to look to make money next week in my opinion next is the yen i highlighted in previous videos that the yen has broken the major breakout level here and this is just simply correcting as it stands and we're in all likelihood going to come back and retest the major breakout level before potentially continuing lower so although this is kind of bullish to neutral i don't think the yen is a great place to be long because first a corrective move tends to be as the name suggests corrective you don't get strong impulsive moves in that direction and so any moves in the japanese yen pairs for example they run the risk of being kind of choppy and corrective reflecting what we're seeing here and the second reason i'm not enamored with japanese yen long positions despite the fact we have some near-term strength here is because of the boj and their super aggressive bond buying which of course is in and of itself devaluing the n so a any yen long positions are corrective b they fly in the face of the actions of the boj so i would still personally prefer to wait for the scorecards to resolve one way or the other for the japanese gem because they're currently neutral and then we start looking at the m pairs again next is the canadian dollar now similar to what we just discussed in the swiss franc we've been looking at canadian dollar long positions and actually they've been working very very well up to last week last week the canadian dollar softened for the first time in scorecards and the cad pairs we're looking at just corrected they didn't go anywhere and heading into this week you can see we may be set now for the next leg down in the canadian dollar if that's the case along with the fact that the canadian dollar score has softened and we have the interest rate decision coming up in two weeks time we can look at the cad pairs just on a relative basis but they go right to the bottom of my list even less interested in the cad pairs this week than the swiss franc pairs and the swiss franc pairs as we just looked at aren't even particularly strong they're just a relative play so we will look at the cad pairs but just bear in mind everything we've discussed maybe i'll be looking at taking one good position in the cad pairs if the opportunity arises but not much more than that next is the australian dollar the australian dollar is forming a classic bear flag here and this correction looks like it's going to come to an end before further declines that would be reflected in aussie dollar to the downside so i am going to be interested in looking at that although i prefer the others because they're weaker and the new zealand dollar finally also displays the same kind of bear flag characteristics but just bear in mind we have that interest rate decision on wednesday so what i would like to see is either the market comes out rallies on wednesday and then starts to roll over like this in which case i'll be looking to be short or the market corrects and then on wednesday you get the break out like this and you get strong move in the direction and then that opportunity will arise from wednesday onwards as well so i like new zealand shorts but we'll have to be looking at those as interest rate decision trades from wednesday onwards next week okay so let's move on to the markets themselves where are the best opportunities in my opinion heading into next week last week we took out the target in crude oil at one one three eight eight and so think about this we took out the target we were correct in the forecast of crude oil and yet with a strong relative score the canadian dollar still failed to perform last week so why is that again this just tells me that this is most likely money coming out of the canadian dollar volatility being reduced in the canadian dollar before the interest rate decision in two weeks so in all honesty i mean i like to put more markets in here for a bit of variety and mix things up the chances of me trading the cad pairs personally speaking next week are very slim if you want to trade the cad pairs when we look at them it's entirely up to you i almost certainly won't be taking trades in the cad pairs i will almost certainly be focused on trading these dollar pairs here and perhaps pound frank the cad pairs will come into play almost certainly once again once that interest rate decision takes place not this week but the week after so any pullback here in crude oil is simply viewed as another opportunity to look for bullish setups into the 118.20 next is pound dollar now when you have these corrective weeks where the markets don't really reverse but they just continue to correct it's really a double-edged sword because yes you don't get the opportunity necessarily to trade nice strong impulsive moves that week but what the market's doing is it's actually pulling back to better prices and it's giving you much more downside reward if you can be patient and wait for a week or two so heading into this week based on everything we looked at in the scorecards i still prefer pound dollar shorts as my best play heading into next week any continued pullback is going to be viewed as an opportunity once again to look for bearish reversals and i'm going to be looking first of all down to the previous lows and then on to the 1.2081 so pound dollar shorts are
my number one play that i'm going to be focused on next week next is EURUSD, EURUSD corrected last week as we have the correction in the dxy and again as this market corrected we had the euro weakening the score cards that is a bonafide sell signal from the scorecards when you have the technicals doing the opposite as i said the vast majority of the time not always nothing's 100 but the vast majority of the time the market will resolve itself in the direction of the forward looking scorecards so any continued pullback in euro dollar perhaps we come back and re-test this level once again who knows but any pullback is considered another opportunity to look for bearish reversals and a breakout of this trend or this counter trend i should say and any reversal is going to be views an opportunity to start to look for shorts into the 1.0341 my third favorite play is new zealand dollar new zealand dollar is also just correcting in this bear flag over here and any continued pullback is viewed and i expect new zealand dollar probably to do nothing between now and wednesday what i would like to see then on wednesday we are expected a potential interest rate hike which of course you would think theoretically is bullish for the new zealand dollar because it is in theory however very often you can get the markets discount in these moves and if this move up here is discounting that interest rate rise then you can very often see the opposite come out so you can see the market let's say the reserve bank of new zealand hikes rates next week but what happens is you get a whip saw and then it breaks lower like this and that opportunity from wednesday onwards if we get this sell-off breaking out of this counter trend on wednesday and we'll look for a pullback and i'm going to look for shorts into the tail end of next week down to the 0.6158 so that's my third favorite pair heading into next week but as i said i'm only going to be focused on this from wednesday onwards this is an interest rate decision setup and i like to wait most of the time till after that takes place and trade the follow-through that's when you'll have the least amount of risk next is aussie dollar i do also like aussie dollar i think there's a good chance we continue down to the target at the 0.6812 it's not highlighted as one of the best simply because it scores us kind of bullish to neutral in the scorecard so i much prefer pound dollar euro dollar new zealand dollar but i also think there's a good chance i mean if these three come down almost certainly we're going to see aussie dollar coming down as well so any continued pullback in aussie dollar is simply viewed as it currently stands as an opportunity you can see we're re-testing over here to look for bearish breakout i'm going to be looking down towards the next key of support 0.6812 okay so moving on to the swiss franc pairs and again just bear in mind you're playing a relative game when you're looking at the swiss franc pairs here same with the cad pairs and so they're not as good opportunities as when you have an outright strong currency versus weak one that's why this is my preferred set heading into next week but pound franc is an interesting one because we had a very big sell-off to the downside and you can see we actually have a major range in pound franc and this is in an overall downtrend so this kind of momentum i mean any pullback in this area is going to be viewed as an opportunity or should be if you use an opportunity to look for a bearish breakout down towards the next key of support to the downside 1.1913 out of all of these other
markets outside of the dollar pairs we're going to be looking at pound frank to the downside is probably my number one let's say alternative setup outside of the best pairs next week next is new zealand frank it's highlighted in blue because it's an interest rate decision next week and any pullback in this market is viewed as an opportunity to look for bearish breakouts say we get that bearish reversal on the interest rate decision itself i'm going to be looking down towards the next q supports downside at 0.6169 now usually with interest rate decisions we look for setups both ways going into next week i'm only really interested in new zealand's short positions if it comes out the opposite and we get a really strong rally and these markets reverse i just won't trade the new zealand pairs at all next week so i'm either short new zealand pairs from the interest rate decision or i'm going to be doing nothing in their new zealand pairs next week next is euro franc eurofrank is also an opportunity that can be considered next week really strong momentum to the downside any pullback in this area would be viewed as an opportunity to look for bearish reversals into the 1.0214 and last and in this case also least the cad pairs because of reasons discussed any pullback in this market continued is going to be viewed simply as an opportunity to look for further declines to the downside going to be looking down to the 1.5737 next is new zealand cad we are also correcting and again you can very often see this being discounted or this is the discounting of the interest rate decision next week so any break lower like this on the interest rate decision would be considered an opportunity to look for shorts into the 0.8016 but the question has to be asked if you do get this breakdown then why not trade new zealand dollar or even new zealand frank over and above new zealand cad next week that would be my personal preference and finally we have eurocad now the interesting thing about eurocad i actually like eurocad to the downside i mentioned this last week keep an eye on this market i think there is really quite a strong probability of further declines in this market but the question is are we just going to correct into that canadian interest rate decision for a couple of weeks and then on that interest rate decision break down like this and start to get the bigger move to the downside so i do still think as i mentioned last week eurocad is a really good short but it just becomes a question of timing we may have to wait until that canadian interest rate decision not this week the week after before we get the big break down in eurocad so i like eurocad i would be focused on shorts but for next week maybe you just have to be a little bit patient on this market but keep this one in mind because i do think we're about to see further declines in this market in the next couple of weeks okay so wrapping up with gold silver and bitcoin if we look at the gold silver ratio you can see although i'm bearish on both gold and silver i am still preferably bearish on silver i prefer silver shorts over gold shorts gold is out performing silver currently and it does look like it has further upside as well so i favor silver shorts heading into next week still over gold shorts if we look at gold gold really just corrected like a number of the dollar pairs last week away from its target and i am just still viewing this simply as a better opportunity to start to look for a breakdown in this market and once we start to reverse that is going to be opportunity to start short into the 1780.35
next is silver i've highlighted silver with a XauUsd tab to highlight the fact that this is one of my preferred setups heading into next week what i really like about this is the 2145 was the major breakout in silver it has come back and retested this and what actually happened was it broke above it last week pulled back and tested it and it started to trade away from this level now the reason i like that is because there are clearly to my eye a number of traders here who are likely to get trapped if this continues lower and the people who bought this kind of pull back to this major breakout level they're all going to be trading with stop losses here and so next week what i see is a very good setup we start to break down back below the 2145 in XagUsd like this and take out the low you're going to see these people start to capitulate you may see a small relief rally and that would provide a nice head and shoulder set up in silver and that would be the opportunity to come down to the 1966. even better if it breaks lower like this and the right shoulder simply pulls back to re-test the 2145 that would be a great setup into the 1966. so look out for this next week but any break lower of this counter trend rally and also the 2145 is going to be an opportunity to start to look for shorts in silver in my opinion and last but not least is bitcoin i did highlight in previous videos the major breakout of 32935 and i said in previous videos bitcoin is in trouble i've been short bitcoin for a while here and heading into last week we did sell off hard towards the 24 307 target but we kind of whipped here and we pulled back the market is now correcting underneath this major breakout level very similar to the euro there is going to be no major reversal in bitcoin unless it can get above the 32 935 because this is a major break to the downside that has to be reversed for any larger uptrend to take place in bitcoin so any pullback in this market perhaps we even come back and re-test the major breakout level but any pullback is simply viewed once again as an opportunity to look for shorts into the overall target to the downside at the 24-307 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 you to everybody who does that on a regular basis and a big thank you to everybody who has subscribed to the channel so far i want to wish you 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
2022-05-23 14:09