Forex Brief for Oct. 4: The Euro to Slide While Gold Keeps Filling Our Coffers
Rowan Crosby • 3 min read
It’s been another busy day on world markets and another successful one for our forex signals. Gold has been the hero lately and we were able to add another couple of profitable trades to help boost our accounts.
Despite the recent sell-off in gold, the yellow metal has managed to find support at the key 1270 level and has bounced, giving us multiple chances to scalp some quick long trades. Gold was a great trade on the way down and now appears to be offering some good opportunities around the current level.
While many of the major forex pairs were a little quiet, in Australia it was RBA day, and that was enough to continue the downtrend and we also identified a nice short trade for our followers.
When we have a big event like non-farm payrolls on Friday, markets have a tendency to go a little quiet. However, the story at the moment is certainly the strong USD and our current signals are heavily focused on riding that trend.
Top Economic Data
There are two big speakers today with both ECB President Mario Draghi and Federal Reserve Chairman Janet Yellen speaking at 17:15 GMT and 19:15 GMT respectively.
GBP – Services PMI is due for release at 8:30 GMT and expectations are for no change from the previous month with the reading to come in at 53.2.
USD – ADP Employment is a preview of Friday's jobs number and is due for release at 12:15 GMT. Predictions are for 125,000 new jobs to have been created.
USD – ISM Non-Manufacturing is out at 14:00 GMT and predictions are for no change on the prior month at 55.5.
EUR/USD – The Slide Continues
As I mentioned earlier, the strength in the USD has certainly been the story of the last week or so. The Euro has been bullish for an extended period of time and has only recently started showing signs of weakness. The Euro is featured as both a long and short-term signal as is our confidence in the new trend.
EUR/USD – 240 min Chart.
EUR/USD – Trading Plan
The plan at the moment is to sell pullbacks. We’ve had a short-term bounce in the EUR/USD off the all-important support level at 1.1700. The short-term opportunity is to target a move to 1.1720. The longer-term goal is to look for a break of support and a move toward 1.1559. You can read more from my colleague Skerdian here, about the sell signal and what the thinking was.
DAX – Time to Hit the Highs
The story of the last week or so has certainly been the rally in the USD and stocks. While a fair bit of attention has been in the US, the German stock index (DAX) has been on a tear. It’s pushing right back up to the highs, and there is every chance that we'll be seeing a breakout very soon. We currently have a buy signal on the DAX and markets are looking strong.
DAX – 240 min Chart.
DAX – Trading Plan
We are charging towards the recent highs and the big 13,000 level. There’s a very high probability that we are going to test the highs and as such our profit target is set just before that point at 12,935. Today might be the day for some follow-through momentum.
Markets are really moving fast at the moment and there are plenty of opportunities around. I think there will be more great setups in gold and oil today as well, so be sure to follow our trading signals page closely to be first to get any updates.