Weekly Forex Forecast (29/08/22) EurUsd / XauUsd + Forex Trading Plan! [HD]

Weekly Forex Forecast (29/08/22) EurUsd / XauUsd + Forex Trading Plan! [HD]

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hey traders it's john fortune here  with this week's weekly forex forecast   i hope you're having a fantastic weekend  last week was dominated by jackson hole and   the speech that the fed chair jerome powell gave  on friday you can see in the dxy we did nothing   until the speech and then we put in this engulfing  candle in the dxy and that's the same also for   stocks we are going to look at stocks because  what happened last week in the stock market   is going to play a large role in where i think  the opportunities lie heading into next week   okay so quick look at the economic calendar and  this was the speech on friday that the markets   braced for they just corrected into didn't really  do anything until this took place and then we saw   the rally in the dxy and we saw a sell-off in the  stock market now usually when power gives a speech   at jackson hole it's 15 minutes 20 minutes long  this was an eight minute speech and the reason for   this was to drive home the message and not provide  any additional material which the stock market or   traders would look at and say oh this is clearly  a pivot or this is the sign of a pivot therefore   we're going to pile back into risk assets and buy  stocks because recently he's been trying to talk   down financial assets and he's been trying to  nudge up unemployment by being hawkish and the   markets have just kind of ignored and discounted  it and said oh he's going to pivot so he wanted   to make this message on point concise and drive  home the point that look we've been here before   in the 70s in the 70s we had very high inflation  and the fed chair at the time arthur burns pivoted   too early he was afraid of causing a really deep  recession so he pivoted too early and all that did   was lead to stagflation which is low growth and  high inflation in the 70s and in the end volker   had to come in in the 80s and crush inflation  with a severe recession anyway so powell's point   is why not cut out the middleman of many many  years of stagflation before a recession anyway   you may as well just get a recession if it's  going to come anyway get it over with early get   it over quickly cut out the years of stagflation  in between and then we can pivot and then we can   manage that decline and start to stimulate growth  once again with the loosening of monetary policy   so you have to understand the framework with which  powell's working with which is that you've been   here before in the us and the last time the fed  pivoted too early and it just led to stagflation   before a major recession happened anyway and  i think for the first time in a long time the   market finally took pal seriously on friday  and this is why we saw the selloff in stocks   and this is why we saw the rally in the dxy if  we just jump ahead to next week you can see that   there isn't really anything there is data coming  out which is important we've got manufacturing   pmis out to china we also have pmis out of  the us and we have non-farm payrolls on friday   but because we had a pretty low volatile week  last week i do think we're going to see moves   before non-farm payrolls on friday  i think certainly the dollar   is going to be the best opportunity heading  into next week and those are going to be my   primary pairs that i'm going to be focused on next  week okay so let's have a look at the scorecards   for the coming week and in last week's video we  identified the swiss franc and the us dollar as   the best potential longs and don't forget this  is a one to four week forward looking scorecard   and the euro and the pound had the worst one  to four week probability scores going forwards   and again last week not much really happened the  dxy just corrected the swiss franc pairs really   went nowhere and so i am still looking for pretty  much the same markets we were looking at last week   however the us dollar changes and becomes the  best potential long play heading into next week so   there are some nuances here i am still interested  in us dollar long's vis-a-vis the pound the euro   and also the new zealand which has weakened and  i am going to be also looking at the swiss franc   pairs once again pound euro new zealand frank to  the downside didn't move much last week but i am   looking for potential follow-through this week  and we can also look at potential aussie plays   vis-a-vis the pound the euro and the new zealand  now the first thing is that as it currently stands   the scorecards are suggesting in the forex markets  stagflation as opposed to a severe risk-off move   why do i say that because the japanese yen is  the most risk-off currency and in a blind panic   where the stock market starts to crash you  would expect to see the probability score   of the japanese yen being over on the left-hand  side here would be positive and with the commodity   currencies like the australian dollar the canadian  dollar you would expect to see them weakening in   the scorecards and potentially being very weak  especially the aussie in a severe risk off or   deflationary environment now maybe that changes  and of course the scorecards are always developing   and they're one to four weeks on a rolling basis  so they can change over the next couple of weeks   but right now the market is not in a blind panic  however based on what we saw at the end of last   week i am slightly wary of taking risk on moves  which would be uh pound aussie to the downside   is a risk on move euro aussie to the downside is  risk on new zealand aussie to the downside even is   somewhat risk on or rather i should say aussie  new zealand to the upside because that's how   it's paired and the second thing to note here is  even though the swiss franc is the second highest   scoring currency it is down by minus two in the  scorecards and especially when a market comes   off overbought for the first time very often  it continues to move down the scorecard so   i am also wary about swiss franc long so  we have two reasons here why the top or   the second and third high scoring currencies  are not in my opinion super favorable next   week because of what we saw in the stock market  and the risk of these scorecards changing if we   get a stronger sell-off next week and we get  more data coming out with non-farm payrolls   so to cut a long story short because of what's  happening in the stock market and because for the   first time in many weeks i am now getting signals  from the stock scorecards to look for shorts or   to be short and i am not actually short already  in eu stocks uk stocks and also some individual   u.s stocks and if that's going to continue into  next week i want to prioritize risk off plays   which would be us dollar long swiss franc long  but because the swiss franc is coming off of   overbought levels by -2 it really just leaves the  dollar as the main focus and priority for me going   into next weekend the dollar pairs are going to  be where i'm going to be primarily looking to make   money next week in the forex markets okay so let's  have a look at the individual currencies and we're   going to see this week the swiss franc is really  confirming what we've looked at in the scorecards   and that's why we look at the individual  currencies to give us an additional filter or   picture of what's going on in the scorecard so  by looking at the dxy technically again pretty   much went nowhere last week consolidated then we  had a bullish catalyst at the end of the week i am   looking further advances and i've been saying all  the way through this is just a correction and i'm   looking for the market to move into new highs and  i do think we're coming to the 109.76 next week   as i said this is the only market and i've been  saying for a while which is in a full-blown bull   market so it is the highest scoring currency in  the scorecards next week and this is where i think   the best chance to make money in forex stands  next week in long dollar plays next is the euro   we came and took out the targets at 0.996 and we  consolidated i am now looking further advances   next week down to 0.9780 and i do think euro  shorts are going to be a good place to look   to make money next week alongside those dollar  long positions next is the pound the pound took   out the target last week and this pattern you're  seeing technically here can you see this where you   have a consolidation after a strong momentum move  like this and you're seeing the same in the euro   when you go and have a look at it we just looked  at it if you go back and have a look at it it's   the same you have this kind of tight consolidation  and in the dollar you have the same you have the   momentum and you have a tight consolidation  these often precede technically speaking   quite sharp moves now these patterns can fail but  when you combine that with the catalyst we had at   the end of last week i do think we're going to  see the pound selling off euros selling off and   i do think the dollar is going to strengthen and  we could get some really decent moves in those   markets next week so the pound is my favorite  short heading into next week it is oversold at -4   in the scorecards but the best signal in terms of  overbought and oversold is when the markets come   off of oversold or overbought in the scorecards  for the first time like we saw with the swiss   franc where it came off of over bought at  plus four last week for the first time that   is the sign that there is weakness in the swiss  franc it's not necessarily when it's overbought   it's when it comes off of overbought for the first  time and the pound has not yet come off of the   oversold levels and if you remember back to the  really sharp sell-off we had in the japanese yen   it remained oversold at -4 for quite a while and  we were shorting the yen that whole time and it   was really when the yen came off of oversold for  the first time that we got the bigger correction   so i do really like pound shorts next week i think  they're one of the best opportunities next is the   swiss rank now the swiss franc has started to  break lower and look at this weakness here now   relative to the other currencies it didn't really  go anywhere last week going into next week the   swiss franc may strengthen once again if we start  to see some panic coming into the stock market   but as it currently stands we're not seeing this  reflected in the currencies and so the fact that   the swiss franc is now technically bearish and  also it's coming off overbought for the first time   this is why we can look at this but it's not going  to be my top plays next week i'm a bit wary of   this and i would much rather if i only trade  dollar pairs next week and these dollar pairs   start to work i will probably not trade anything  else in the forex complex i will just leave them   so we will look at the swiss franc pairs next  week but just bear in mind these are not in my   opinion fantastic opportunities anymore with  what we're seeing in the scorecards and also   what we're now seeing technically but relative  to the other currencies it's actually still one   of the better currencies next is the yen i  left the yen recently because it was kind of   neutral and it still kind of is neutral so  i'm going to be off the yen again next week   i question whether we come down here take out the  target and double bottom and that would actually   potentially fit with the continued sell-off in the  stock market as money starts to come into the end   on a flight safety again look we're not seeing  this yet the yen actually sold off on friday so   although we had a sell-off in stocks and  it does look like the bear market in stocks   is going to continue we are not yet seeing a panic  flight safety in the japanese yen the money's   really just going into the dollar even the swiss  franc didn't really benefit so patience required   on the yen in my opinion next is the cad kind of  similar to the yen we are technically bearish but   relative to some of the other currencies is  actually fairly strong as other currencies   like the pound and the euro have been selling off  with momentum and continuing you can see this has   just kind of gone sideways and the scorecards  actually warned us about this pretty much in   advance of this taking place it said that the cad  was kind of neutral and we've avoided some choppy   markets here so relative to the other currencies  it's not too bad but it's not great heading into   this week in my opinion i think there's better  markets next is the aussie also relatively quite   strong as we saw in the scorecards because don't  forget the scorecards are relative because you're   looking at trading forex in pairs but technically  speaking this is actually head and shoulders and   again perhaps we do start to see some panic coming  into the market next week perhaps we do break down   here in the australian dollar and we do start to  see the aussie moving from positive to negative   in the probability scores as more data comes in so  when you look at the swiss franc and you look at   the aussie here you can see why the dollar pairs  are the only pairs highlighted in gold as my top   plays next week and although we'll look at these  on a relative basis the swiss franc pairs and the   aussie pairs i don't think they're as good as an  opportunity next week as the dollar pairs and last   but not least we have the new zealand it's weak  in the scorecards and it's also breaking a head   and shoulders reversal to the downside i do think  new zealand shorts are going to also be a good   place to look to make money next week in forex  alongside the pound and the euro to the downside   okay so let's have a look at the markets  themselves starting as we always do with crude   oil and many of you know back on june 30 if i  tweeted out that oil had likely peaked and we did   fall nearly 20 since then it was over in this area  and for the first time last week the commodity   scorecard started showing oil kind of accelerating  in the data and it suggests at the very least that   crude oil is not yet a buy but the short that  it was back from june 30th has kind of run out   of steam i wouldn't be surprised to see crude oil  kind of correcting so i am still bearish on crude   oil overall but it is currently sort of neutral  so i wouldn't be surprised he continued correction   and on balance any correction would be viewed as  an opportunity to look for shorts but i would like   to see this start to decelerate or accelerate  to the downside once again in the commodity   scorecards and when that takes place i will let  you know so crude oil as it currently stands i   am bearish but it's kind of bearish to neutral  i think there are better opportunities next week   the first forex market we're going to look at  is pound dollar now this is my favorite market   heading into next week it's the strongest versus  the weakest in the one month forward probability   scores we had a huge engulfing candle off of the  speech by fed chair and this is after quite a   tight consolidation and i do think this is going  to continue down i am looking for this take out   the target set from last week at the 1.1715 we may  even consolidate here slightly at the beginning   of the week but i am looking for further declines  below here and the next care of support is down at   the 1.1411 this is my favorite market next week  i think this is the market that offers the best  

chance to make money next week and remember you  only need one good market each week you don't   have to trade every single market it's about  finding the best market which is going to move   and profiting from that next is euro dollar we  came down and took out the target set at 0.9927   and this was the target achieved after we tested  the major breakout level of the 1.0343 which i   mentioned when we had this correction this  just looks like a correction to re-test   and then we had the sell-off coming into  this week i am looking for further declines   if you want a more conservative target you  could look for the 0.980 but i am looking   for the declines perhaps we bounce from this  psychological level first and then eventually on   two may take a couple of weeks but on to the zero  point nine five ninety again i think this is one   of the best opportunities to make money in forex  next week and this is one of my top three main   pairs that i'm going to be looking at next week  next is new zealand dollar we've also broken out   of this tight consolidation in new zealand dollar  going into next week any correction and we've   already started to get some momentum maybe we come  down a little bit further first but any correction   pull back in this area will be viewed as the  opportunity to start to look for bearish reversals   i'm going to be looking down towards 0.6015  okay so moving on to the swiss franc pairs  

these were markets we looked at last week and they  didn't fail they just went nowhere they just very   much like the dxy pairs they corrected into the  speech on friday and then they started to move   and very often you'll see this markets can  actually take a week or two to actually move   or even three weeks and essentially what we saw  last week is just rolling over to this week so   they are not highlighted in gold because of what  we've already discussed but i do on a relative   basis after the dollar pairs think the swiss franc  pairs are the second best play and any continued   sell-off and then pull back in this market is  going to be viewed as an opportunity because   you usually always get a pullback during the week  is going to be an opportunity to start to look for   shorts into you can look conservatively for the  1.1200 but ultimately i'm looking down towards   the next care of support at the 1.1119 next is  eurofrank we did come and take out the target at   0.9577 this is a market we've been shorting all  the way down it's been in the weekly forecast   as a great short really pretty much since the  start of this move down maybe slightly after   but this is still a market i am looking further  declines to the downside any continued pullback   is simply viewed as an opportunity next week  to look for bearish reversals i'm going to be   looking down towards the next care of support  0.9445 and the final frank pair is new zealand   frank this was also a market we were looking at  last week and this was actually a really nice   move to the downside and again even though  the swiss franc itself sold off and was weak   we still saw this moving to the downside why  because on a relative basis we had already   worked out the probabilities and that this was  likely to happen and it happened even in the face   of swiss franc weakness so any continued pullback  in this market now we've got momentum is simply   viewed as an opportunity to look for shorts  into the 0.5904 which we were looking at in   last week's video and if we can break through  here i'm going to be looking down towards 0.58  

and the final forex pairs we're going to look at  here are the aussie pairs now these are in purple   for a reason because my base case for next week  is that we get a continued sell-off in stocks   and we're going to look at the stock market in  this video at the end of the video and if we   do get the continued sell-off in stocks that is  likely to see risk off coming into the markets   that would cause the dollar to outperform but it  would also likely cause the swiss franc pairs to   re-accelerate in the scorecards and the aussie  in the face of risk-off sentiment would actually   suffer so they're in purple because these are  more of a backup plan next week yes my primary   plan is for dollar strength and then secondarily  i'm going to be looking for swiss franc strength   vis-a-vis these currencies but if that  doesn't work even though i believe it   is most likely going to then there's nothing  wrong with having a backup plan especially if it's   already pre-prepared in the scorecards which is  aussie strength so if for whatever reason we fail   to get dollar strength and swiss franc strength  then you can pivot and you at least have a plan b   in the aussie pairs so any pullback in this  market is views an opportunity to look for   shorts perhaps we come back and test the 1.69180  first taking out this target and then correct   either way any correction is views an opportunity  to look for shorts into the 1.6918 and then on to   the 1.6685 again if we get continued selloff in  stocks i won't be trading the aussie pairs at all   because i'll be looking at the risk-off moves of  the dollar and the swiss franc pairs all of these   aussie pairs are risk on setups so very important  i'm not interested in trading these next week   unless we start to see the dollar strength and  swiss franc strength fall apart it just gives   you a backup plan next is your aussie we did  take out the previous target to the 1.43 to 90.   we've already started correct so any continued  correction is viewed as an opportunity to look for   bearish reversals i'd like to see this breaking  out with momentum that would be the opportunity   to start to look for further declines  and short opportunities into the 1.3987  

and that's what you would likely see if for  whatever reason the dollar let's say you had i   don't know is highly unlikely you would get a fed  official coming out and reversing the dollar based   on what we've just heard but just hypothetically  let's say something happened to reverse the dollar   and you saw a steep sell-off that's when you would  likely see the aussie accelerating and you would   see this momentum to the downside like this so you  would look at the dollar and say okay well this   isn't good and now we've got these setups in  the aussie pairs instead that we can pivot to   and finally we've got aussie new zealand any  continued pullback as a plan b would be viewed   as an opportunity to look for bullish reversals  and again perhaps you see a flight out of the   dollar and the swiss franc for whatever reason as  unlikely as i believe that is then you would see   the aussie accelerating like this and that would  be your opportunity to pivot and look for the   1.1290 so i hope that's clear based on what we're  seeing in stocks i am looking for risk off next   week my primary way of reflecting that will be in  the dollar pairs second will be in the swiss franc   pairs and if those fail to work and for whatever  reason we get unexpected risk on which i think is   highly unlikely but if we do at least you have the  aussie pairs to pivot to in that scenario okay so   wrapping up with gold silver bitcoin and also a  look at the us stock market the gold silver ratio   is breaking out of a consolidation to the upside  and in last week's video i highlighted silver   and bitcoin as two of my top plays both of these  have started itself to the downside and i did also   highlight the fact that silver was my preferred  play over gold so silver shorts over gold shorts   and we did actually see silver outperform to the  downside last week compared to gold and it does   look like this is going to continue next week so  again i prefer silver shorts over gold shorts but   as you will see i am bearish on gold silver and  bitcoin next week next is gold very much like the   other dollar pairs it just contracted into friday  or corrected and then it started to break down   i did highlight the fact that it traded into its  previous major low of the 1787.3 and that we will   likely now head down to the 1676.87 i do believe  it's making its way down to this level so any   pullback next week in this market is viewed as  an opportunity to look for shorts down to next   year of support at a 1676.87 but once again i  do prefer silver shorts over gold shorts next  

is silver this was highlighted as a top market to  look for to the downside last week we corrected   into jackson hole and then we sold off right  at the end of the week so i am actually looking   for these pretty much to go at the beginning  of the week because we've already had this   consolidation pretty much all week last week so  any minor pullback likely on monday is going to   be viewed as an opportunity to look for shorts  once again for anybody not involved from last week   i'm going to be looking down towards the  next q support to downside the target set   the 17.63 and the final market before we look at  stocks is bitcoin i am actually short bitcoin i   did tweet out last week at the end of the week  that bitcoin looks set for the next leg down   and we have started to make our way down with  momentum any continued pullback in this market is   simply viewed as an opportunity once again to look  for bearish reversals i'm going to be looking down   towards the next key of support to the downside  the target is set at the 16 492 okay so finishing   up the video by looking at your stock market and  this is important because it affects the markets   we've looked at already so i do favor as my base  case risk off plays next week and the risk on   setups down here will only be a plan b if risk off  for whatever reason doesn't work but my base case   is for risk off that is where i'm looking to make  money next week and it's in the dollar pairs the   swiss franc pairs and not only are they the best  scoring currencies in the scorecards but you can   see in previous videos i highlighted the 417-751  i said to you once the market starts to cross back   down below this level and we looked at in previous  videos how closely these markets resembled those   of 2008 it's pretty amazing to see it doesn't  mean it's going to continue playing out like 2008   although i did note in a previous twitter thread  on sentiment that sentiment also mirrored 2008   and i said to you in previous videos that it's the  417-751 in spx if we start to fail below here this   is where the next leg down is likely to start we  closed above here on a daily basis on thursday and   then what happened powell came out hawkish and all  of these traders who have been buying in believing   this is a generational buying opportunity  in stocks and they don't want to miss out   they started to capitulate and panic sell and  this actually caused a steep sell-off this was   panic selling this was capitulation we didn't  see the flight safety in the yen or the swiss   franc as i said earlier but we did see a panic  selling and i believe this is likely to continue   into next week and this is actually the start of  the next leg down in stocks if this is going to   be the case we're likely to see risk off come  into the markets more and more and that would   support the dollar pairs and the swiss franc  pairs we discussed and it also would that's one   of the reasons why i'm not massively keen to get  involved in the aussie pairs as of next week so   i'm looking further declines i think we could very  easily be coming down to the previous lows here   in terms of a crash well markets don't tend to  actually crash from the top of bear market rallies   what tends to happen is you get a bear market  value like this and then it starts to sell off and   usually markets actually crash near the bottom so  i'm not saying the markets are going to crash next   week but i wouldn't be surprised to see a gap down  and any corrections in stocks especially below the   four one seven seven fifty one in my opinion  they should just be viewed as opportunities   to be short or look for short opportunities in  stocks okay so the final thing to note here really   is the vix i've been discussing in previous videos  that my base case is for the vix to come down to   1850 before we see the next round of volatility  coming into the markets and of course at the same   time as you see volatility spiking that's when  you're going to get sell-off in stocks we came   very close but we didn't take it out and it left  me with a slight dilemma last week because i was   starting to get my process for the first time  signal to get short as opposed to being bearish   which i've been for a while there's a difference  between being bearish and being short and the   difference is timing and last week as i said to  you i did get short eu stocks uk stocks and also   i am shorts of u.s stocks and this is not advice  to you this is just what i'm doing personally   but i favored getting short but leaving myself  enough room that were the vix to drop to 1850   i'm not going to be whipsawed out of my position  so you have to remember just because i personally   would prefer the vixx to come down to 1850 before  i got very very comfortable with the shorts   it doesn't mean it's going to happen and with  a catalyst like we had on friday we could very   well see the next round of volatility coming in  before the vix gets to 1850. so again this is not   financial advice it's just how i'm viewing it and  that's that uncomfortable getting short on stocks   as i did last week in case this is the start of  the next round of volatility in the stock market   but i'm giving myself enough room to allow for  a move to vixx 1850 if that does for whatever   reason materialize so that is it from me for this  week guys as always i hope you enjoyed this video   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 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

2022-08-28 23:18

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