We started the week on the right foot today with a couple of winning FX signals, one of which came as a result of New Zealand's election. German elections are also over which should have been good for the Euro, but the Euro is following the Kiwi down the sink.

One more term for our Angela.

Euro Dives After German Elections

Angela Merkel’s CDU/CSU coalition won the German elections yesterday as the polls have been indicating in the last few weeks. Normally, you would expect the Euro to rally after the elections. Merkel won, so that means stability for the Eurozone, but the Euro is slipping.

One of the reasons is that there’s uncertainty about the future coalition, especially since the extreme right wing is in the parliament for the first time.

The Euro lost about 60 pips when the forex market opened last night, and it is continuing to slip lower. This is good for our long-term sell forex signal in EUR/USD.

In fact, looking at the EUR/USD weekly chart, you can argue that this pair has formed a top for the time being, and it is now turning lower. Let’s hope this turns into a decent retrace, and this pair reaches the 100 SMA (red) at least.    

The 200 SMA (purple) is providing solid resistance.

New Zealand Elections Are Hurting the Kiwi Too

We have the New Zealand elections taking place this weekend as well, but unlike the Euro, the Kiwi is feeling the heat beforehand. NZD/USD lost 80-90 pips tonight, and this morning it completed a retrace higher to the 100 SMA on the hourly forex chart.

We mentioned in the previous market update that this moving average is providing resistance on the hourly chart, so we decided to try the downside on this pair again after having a winning forex signal this morning.

We’re already in profit, so you can lock this trade at breakeven, which means bringing the stop loss to the entry level (0.7291). At the moment the market has taken a break and nothing much is happening, but hopefully, the U.S. traders will spark some life into it.

Trades in Sight

Bullish USD/JPY

1. The trend is bullish
2. The 100 SMA (green) is providing support
3. The area around 111.90-112 is a support level
4. The H1 chart is oversold

Back on the bullish trend.

I was looking at this chart setup earlier, but I missed the entry when the price was down at the 100 SMA. As mentioned above, this chart looks quite bullish to me. The retrace lower is done, and the 100 SMA held the price, so now we are back in bullish mode.

In Conclusion

The ECB president Mario Draghi is having a speech soon. He had two speeches last week which didn’t affect the Euro. This time, he is speaking at the European Parliament, and he’ll be talking about the monetary policy. I don’t think that he will go by unnoticed this time so get ready.