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Forex Signals US Session Brief May 09 – The USD Pulls Back, We Get Active with Signals

The strong uptrend continues today for the USD. Right now it is retreating, which is perfectly normal during uptrends. The price action of the last few weeks has shown us that pullbacks, such as this, are great opportunities to buy the USD, so let’s see what we can trade. Bitcoin continues to slide, though it stalled right at the indicator we mentioned yesterday. The uptrend seems poised to resume soon.


Looking for Trades in USD Pairs

Earlier today, we posted an update where we highlighted the strong downtrend in EUR/USD. This forex pair broke the 50 SMA on the weekly chart yesterday. This moving average has acted as support and resistance previously, so now that it has been broken to the downside, the 50 SMA (yellow) looks like a good place to look for shorts. That moving average stands at around 1.19, while the price is at 1.1860s at the moment. If EUR/USD retraces up there, that would be a great opportunity to go short on this pair.

We just went short on AUD/USD (more details below). GBP/USD seems interesting too. It is trading at the 50 and 100 SMAs on the hourly forex chart. These two moving averages have been providing solid resistance on the way down over the last several weeks, so this opportunity looks great for sellers.

We have had a few forex signals on this pair, selling at the 50 SMA. All of them closed in profit, but GBP/USD hasn’t been making new lows like the rest of forex majors. It has lost nearly ten cents in a month and a decent retrace up is overdue, so, I think we will leave this pair alone for now.

USD/JPY looks very interesting as well, although in a reverse mode. It surged 80 pips higher this morning but it is reversing now. This reverse on the H1 chart is a retrace on the larger time frame charts. As we said in the previous forex update, the pullbacks in this pair today are a great chance to go long, particularly after the uptrend picked up pace today. I’m not sure at what level I will buy, but we just sold EUR/USD, so we have three open signals on major pairs already.


The Pullback in Cryptocurrencies Might Be Over. Get Ready to Buy

Yesterday, in the midday brief, I highlighted the pullback in cryptocurrencies. They have been trading in a steady uptrend for about a month. They started retracing lower on Monday after Bitcoin got close to the big round level at $10,000. It failed to move above that major level and started to retrace lower, pulling the other major cryptos down with it. We know that Bitcoin leads this new digital currency market.

We also highlighted the level where the retrace might end for Bitcoin. The 100 simple (green) and smooth (red) MAs had provided support and resistance previously, so it seemed like the target for sellers was either of these moving averages. These moving averages have converged and are pretty close at the moment, indicating that the reverse was going to take place somewhere there, wasn’t it?

It was and it did. The decline stopped right at the 100 smooth moving average (red). The price is reversing back up now, climbing back above $9,000 after having broken below it this morning. Now, the H4 candlestick looks bullish since it is closing as a pin. A pin is a reversing signal, particularly after a retrace like this.

The stochastic indicator is almost oversold. That means that the pullback is almost complete, so it seems like the uptrend will resume again. Want to go long on Bitcoin now?


The retrace is over, the upside is about to resume again



Bearish AUD/USD

  1. The trend is massively bearish
  2. The downtrend picked up pace today
  3. The 20 SMA (grey) is providing resistance
  4. The previous H1 candlestick formed an upside-down pin


We already sold this pair at the 20 SMA

AUD/USD has made some new lows today, which means that the sellers are in control. Although, we are seeing a pullback at the moment and we decided to take this opportunity. The stochastic indicator is overbought which means that the retrace is complete in this time frame. The pin candlestick is a reversing signal, so we went short. Now comes the part where we just wait.


In Conclusion

Trump scrapped the Iran nuclear deal and Oil prices tumbled yesterday, but they have recovered today and the CAD is gaining momentum. The market is a bit confused at the moment but we saw this as an opportunity to open a few forex signals. Now, we are quite exposed, so we will remain on the sidelines and try to nurse our trades.

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Skerdian Meta
Lead Analyst
Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.
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