The last few trading weeks of the year have really been a mess, especially the indices which saw a lot of abnormal movement but by taking a closer look at the weekly and monthly charts I see something special coming. (but this post is not going to go over that)
I don't normally like releasing posts about this as I am not consistent in releasing the posts due to my obligations, so don't get use to these posts, unless you're in my community, then you'll always get it there!
To being this post I will wrap up last weeks trades and news, starting with the news:
Reviewing the ECB comments and action of the last week and month strongly suggest that the ECB is preparing for a potentially long period of negative rates.
It is very important to know that EBC's negative rates have not produced any special results for the Eurozone and if a recession/depression comes, as most expect it to come due to data and historical figures, Europe will be in hell, almost literally.
Regarding Brexit... it filled the weeks with votes, news and GBP turbulence.... but the main headache on Brexit is that there is no majority for any of the different solutions... but the pressure is quite low so Parliament cannot (or will not) take any action yet. And this is proving to be a potential huge issue for the markets in the near or medium term future.
The 10-year yields continue to have sharp declines which is a result of the economic slowdown, weaker inflation and dovish central banks.
Last Friday an important event occured, for the first time since 2007, the 3 month and 10 year Treasury note inverted, and an inverted yield curve squeezes banks profitability which is seen as a recession indicator.
We did release some great alerts last week, especially the selling of NZD pairs which gained us almost 300pips, so the trading week and month ended great!
THE WEEK AHEAD
Since it's a new trading month, that means on Friday we will see the US jobs report, which is the most important release of the upcoming trading week.
In the europe, the Inflation data will be the most important figure coming out.
Regarding Brexit the EU27 is suppose to make a response, the markets expect a long extension to happen, but let's see what actually happens. In terms of UK data, we are due for PMI's.
In Australia we get the RBA meeting minutes, building approvals and retail sales.
Generally make sure to check the calendar and mark down any important events on the pairs you might bet rading.
TWO IMPORTANT CHARTS
The US Dollar index is the first chart I check every Sunday because it dictates the price of the USD versus many major trading pairs. It is literally the best way for me to determine if the US Dollar will be strong or weak in the upcoming trading week.
The daily chart right now shows strong signs of a weaker USD, and since me and my community members are holding a EURUSD sell since last week this gives us good hope to ride EURUSD as a winner and hold till our TP.
(click on the chart to enlarge)
I'm now moving over to the daily Gold (XAUUSD) chart, which too suggest a weaker USD in the new trading week.
The main reasons I believe that this "head and shoulders" pattern, seen in the chart below, will fail is that we have a strong 3 higher low pattern which is accompanied with a double reversal candle, which on the daily chart strongly suggests a reversal.
(click on the chart to enlarge)
I don't have anything else to add here regarding the markets but I do want to say that if you're looking for a solid trading community, where you learn and use a structured trading system, which is simple to apply and focus on consistency in terms of profits, then you need to try out my community, monthly access is an investment of just 56 euros a month, and the first money has a full money-back-guarantee. - If you don't like it and it doesn't benefit you, simply get your money back.
You can join by either heading to the front page of this site, or email me directly on Denis@pipsmatter.com
Thats it for now, have a super trading month and new quarter!