What are positions on #harmonica?
2nd Position (Cross Harp), is a #Blues scale that offers a more expressive and so… twitter.com/i/web/status/1…—
bluesharp (@bluezharp) September 30, 2020
Hope the picture shows
Brian Twomey
Month: September 2020
Weekly Trade Results: GBP/USD, GBP/JPY, USD/PLN, PLN/HUF
USD/PLN
Short 3.9366 and 3.9455 to target 3.8739 then 3.8694.
Highs 3.9411, Lows 3.8683
Target Perfect
target complete
USD/PLN 2nd and 3rd Legs
Long 3.8694 to target 3.8829.
Short 3.8471 to target 3.8113.
We shooting for Long 3.8694 to target 3.8829
GBP/USD
2nd 3rd legs traded
Long above 1.2819 to target 1.2953
Highs 1.2931
Trade ran 112 pips
Short 1.2953 to target 1.2853
Lows 1.2827
Trade from 1.2931 to 1.2827, +104 pips
2 trades, 1 day +216 pips.
GBP/JPY
2nd Leg Traded
Long above 135.82 to target 136.93
Highs 136.24
Trade Running +42 Pips
PLN/HUF
Short 80.86 and 80.96 to target 80.05.
Highs 80.64 and just entered short
Trade ongoing
3 trades, 2 days, +944 Pips
Brian Twomey
Weekly Trades: GBP/USD, GBP/JPY, USD/PLN, PLN/HUF
At least 20+ currency pairs begin the week sitting either on solid supports or strong resistance points above. EUR/USD 1.1609 Vs USD/JPY 105.96 for example. Both are exact opposite pairs. NZD/USD 0.6557 Vs AUD/USD 0.7066. AUD/JPY 74.84 Vs EUR/JPY 122.98. Prices at vital price points contain ability to fly either way.
Not much happening with currency prices to trade from the open as patience is required this week to wait on our entry points.
PLN/HUF is deeply overbought short, medium and long term and encompasses a long term target at 76.19 from current 79.88. PLN/HUF arrives at 76.19 upon breaks at 79.85 and 77.28.
Despite a lofty target, PLN/HUF target will take time as weekly ranges are fairly dead within `100 pip weekly moves. By trading PLN/HUF is the same as trading USD/PLN only a slim down version as weekly pip ranges are small compared to 800 and 100o pip weekly ranges to USD/PLN. A low Vs high range currency pairs.
For PLN/HUF is overbought as well as USD/PLN. PLN/HUF will assist to bring down USD/PLN this week.
GBP pairs this week are best to overall trades while the remainder pairs must wait for the breaks to occur.
PLN/HUF
Short 80.86 and 80.96 to target 80.05.
Short 79.85 to target 78.83
Long 78.83 to target 79.54.
Long 80.05 to target 80.45.
USD/PLN
Short 3.9366 and 3.9455 to target 3.8739 then 3.8694.
Short 3.8471 to target 3.8113.
Long 3.8113 to target 3.8024.
Long 3.8694 to target 3.8829.
GBP/USD
Long 1.2687 and 1.2670 to target 1.2803
Long above 1.2819 to target 1.2953
Short 1.2953 to target 1.2853
short 1.2803 to target 1.2754.
GBP/JPY
Long 134.07 and 133.92 to target 135.66
Long above 135.82 to target 136.93
Short 136.93 to target 136.14
short 135.66 to target 134.87. Long only strategy.
Brian Twomey
Weekly Trade Results: AUD/USD and AUD/JPY
Brian Twomey
Stock Market Trade by Interest Rates
An Equity Derivatives trader. Don’t know what this title means. My assumption is stock prices are factored from yield curves.
In the old days of trading, all financial instruments especially currencies were traded along the yield curve. Still widely exists today as a strategy among the smarter traders but its never seen or mentioned anymore.
Many examples how to trade the EUR/USD from yield curves are located on this site.
Currency trades from yield curves for example, are traded as yield crossovers between nations such as USD/CAD vs the USD and Canadian 2 and 3 year yield. Longer term trades are factored from 5, 7 and 10 year crossovers. A trade may factor from a single nation’s yield curve.
Trades may factor for another example by ranges of certain yields. The trade is short and long at tops and bottoms of yield ranges. What’s important in this regard is Currency trades are also traded by Forward Points and Forward Points are located at each yield. The higher price travels up the yield curve then the more forward points increase in ranges.
The same concept exists to currency and all financial market prices. As prices travel up the yield curve then the more ranges expand. But so does tops and bottoms become important as location is most vital to a price yet its the least understood concept among today’s traders.
A price trading at the 10 year yield contains much daylight to drop as the only points remaining on a yield curve is the 20 and 30 yield and its the tops. A price can’t and won’t travel higher than a 20 and 30 year yield.
The concept to overbought and oversold is found in the location of a price along its interest or yield curve. The better concept is to high or to low. A price trading at the 10 year yield is overbought or to high while a price at the 1 year yield is low or oversold.
Another way to trade currencies is by the interest rate curve and its my way. Interest rates are lower and trade below yields. They are the first rates offered by central banks daily and interest rates prices yields.
Most vital is all financial instruments trade by an interest rate either as a pure interest rate or yield. Its impossible not to trade a price by an interest rate of some sort as market prices move, currencies especially, by an interest rate.
I factored today’s S&P’s by this morning’s yield curves to understand an Equity Derivatives trader. Using yield curves for trading is a view to longer term trades as ranges are extremely wide.
1. The S&P’s opened at 3281. 06. All financial prices open and close many, many times at equilibrium. Viewed better to understanding is open and close at neutral. The S&P’s opened today at neutral 3281.06. This price had an equal chance to rise or fall and this is what neutral means.
2. What is factored 1st is a yield rate and this rate is calculated above and below. Above means factor from normal yield rates and below means factor the inverse of yield rates. The purpose is to understand interest ranges and averages to our financial price trades.
Above yield rates from the 3 month rate at 0.081 to 1.417 at the 30 year factors using the current Fed overnight rate at 0.09.
Mean. 1.0673
Median 1.00 or Parity
SD. 0.4056.
Above range factors
Mean. 3502.18
Median. 3281.16
SD. 1330.01.
Range Averages factors
Mean.3502.18
Median. 3286.89
SD. 368.15
Check for yourself as today’s trade able levels: 3281.17, 3281.22, 3281.54, 3282.43, 3284.23, 3286.89, 3319.85,3419.53, 3583.37, 4126.24 and 4377.59
Bottom.
Interest Rates
Mean: 0.0106
Median. 0.0099
SD. 0.0040.
Top Vs Bottom Interest rates ranges: 1.0673 Vs 0.0106.
Range Averages
Mean. 3500.28
Median. 3281.05
SD. 1361.23
Average of Ranges
Mean: 3523.85
Median: 3346.67
SD: 373.79
Results
BY taking range averages for tops and bottoms, we have: 3523.85, 3500.28, 3502.18 and 3502.18.
4 numbers represents most vital averages. Same principle and concept is employed and holds for our currency day trades. Its a must know to where vital averages are located above and below for any given day.
We know every vital range point from 1607.71 to highs at 6627.74.
We know interest rates and interest ranges. Its learned over time how to understand and interpret the interest rate averages to an interest rate as to high or low in relation to high and low financial prices by taking the interest rate X and divide by the average price. You’ll find a market price and the inverse to the market price.
As can be seen from the list above, yields offers today’s trade yet ranges are extremely wide. And its why I don’t like using yields for an S&P trade but rather central bank interest rates. Ranges are not as wide as yields.
Trade by Inverse.
The inverse price to 3281.06 is 0.00030.
The overall ranges to inverse prices are located from 0.00030 to 0.00041. Inverse prices are located at vital range points. Much easier to trade by inverse numbers as ranges are much smaller and they don’t change by much each day.
To trade any stock market is to know each nation’s interest rate. Its perfectly accurate for trades daily and long term. Its impossible not to be accurate.
The sad part to professional and perfect method trading is the concepts disappeared from public view in favor of speculators with money but not a clue to what they do and why.
Brian Twomey
AUD/USD Weekly Trade Results
Weekly Trades: AUD/USD, AUD/JPY and 18 Currency Pair Analysis
Best description to overall currency market prices last week was balanced, settled, centered, at equilibrium. The same description applies this week to currency prices and it means no dramatic moves are expected and no significant breaks to main averages. Range trading is again the order for the week.
GBP pairs represent slight outliers to balance as GBP/USD again sits on massive supports at 1.2800’s while all GBP cross pair prices are low, oversold and expected to rise significantly this week. Yet any GBP rises are trades within respective ranges.
GBP/NZD offers the best longs along with its counterpart EUR/NZD.
GBP/NZD will outperform EUR/NZD. GBP/NZD is truly an outlier currency pair due to its wide and expansive ranges. It should trade easily at 1.9400’s and 1.9500’s but miniscule ranges to GBP/USD are holding GBP/NZD to trade to its full potential.
GBP/AUD will outperform its counterpart EUR/AUD.
For EUR/AUD will range trade against its main counterpart AUD/USD. No such price exists to EUR/AUD above 1.6400’s. GBP/AUD outperformance is explained by expansion of weekly ranges over the past 3 weeks. GBP/AUD requires a break of many averages at 1.8100’s to move higher.
GBP/CAD ranges this week went dead again and no big moves expected. GBP/CAD ranges expand and contract based on the GBP/USD and USD/CAD relationship. GBP/USD at 1.2900’s and USD/CAD at 1.3100’s warns to a big move ahead and only then will the big trade for GBP/CAD exist. EUR/CAD is the better trade.
GBP/CHF price longer term is low and deeply oversold. It must and will eventually trade to 1.1900’s and 1.2000’s easily. This week however, GBP/CHF price lacks movement ability and will trade in tiny ranges. This means its performing its vital function to act as support to GBP/USD and GBP/JPY to allow both to move higher.
The message from GBP/CHF this week is all CHF pairs as Other Pair/CHF are all overbought. NZD/CHF offers the best and easiest trade for shorts while AUD/CHF and GBP/CHF offers low yet decent ranges. The weekly trades aren’t dead issues but better trade choices exist.
USD/CAD and CAD/JPY are again mis positioned this week. CAD/JPY is a low range currency pair and ,its matched by a good and fairly normal USD/CAD range. Its CAD/JPY mis positioned against USD/CAD.
Most interesting trades this week are JPY cross pairs against Non USD counterparts such as GBP/USD Vs GBP/JPY, AUD/USD Vs AUD/JPY, NZD/USD Vs NZD/JPY and EUR/USD Vs EUR/JPY.
Best combo trade is found in long GBP/USD and GBP/JPY as GBP/USD will be the leader this week to GBP/JPY because its sits on solid supports.
Correlations informs to the JPY cross pair vs Non USD alignments as EUR/USD Vs EUR/JPY run +98%, AUD/USD Vs AUD/JPY run +99%, EUR/JPY Vs AUD/JPY run +98%, This means non USD will run together with JPY cross pairs.
No need ever to run Correlations to GBP/USD Vs GBP/JPY as Correlations rarely if ever break. The GBP/USD Vs GBP/JPY relationship was solidified as one dating to the 1930’s when the BOJ pegged GBP/JPY to Gold.
USD/JPY price is low and oversold from 106.00’s to 108.00’s. For USD/JPY must break 105.81 to move higher to target 106.00’s and 107.00’s. Massive resistance exists at 108.00’s.
EUR/USD is a range trade and balanced this week. Break of 1.600’s changes trend to a lower EUR/USD. EUR contains the opposite line up as GBP pairs. EUR/JPY sits just above a big break point and no threat to EUR/USD breaking 1.1600’s. For GBPUSD sits on big break point to move lower while GBP/JPY price is low and oversold.
NZD/USD price sits just above solid supports at 0.6600’s and 0.6500’s. The averages at supports are many and massive. Only a break at 0.6500’s changes NZD/USD direction to short.
NZD/JPY however trades just above massive supports. No chance for NZD/USD to break 0.6500’s and this allows a combo trade to NZD/USD and NZD/JPY.
If NZD/USD breaks its 5 year average at 0.6809 then much higher for all non USD pairs such as EUR/USD, GBP/USD, and AUD/USD.
AUD/USD contains no chance to break low 0.7100’s this week to change its trend to a lower AUD and AUD/JPY like its counterparts EUR/JPY and NZD/JPY , trades just above supports.
Weekly Trades AUD/USD Vs AUD/JPY
AUD/USD
Short 0.7336 and 0.7350 to target 0.7193.
Long 0.7193 to target 0.7279.
AUD/JPY
Long 75.94 and 76.08 to target 78.11
Short 78.11 to target 76.18
AUD/JPY supports located at 75.46.
As a new week begins, we trade 18 currency pairs continuously without fail from Sunday to Friday or from target to target.
Brian Twomey, Contact brian@btwomey.com
Negative Vs Positive Interest Rates: NZD
The difference between positive and negative Interest Rates is for the most part, nothing. The only change is positive interest rates will work on a negative scale instead of the positive spectrum. Computations are the same except for the negative minus sign.
Overall, negative interest rates are meaningless to FX prices and EURUSD is the prime example, now 6 years in existence. The only possible difference seen is to daily Fx ranges however central banks have this aspect fully covered so FX prices don’t move and to contain prices to tiny ranges. The EUR/USD for example at the 2014 time to go negative contained 75 and 80 pip daily ranges and today, the range was cut by 1/2.
The NZD 5 year Yield went negative -0.02 today from positive 0.01 yesterday. For NZDUSD, the negative rate expanded the overall range 94 Vs 144 pips to be exact but only for the interest Maturity at -0.02. Overall, nothing changed for NZD prices as other maturities compensates for the 1 negative maturity. If all RBNZ rates go negative then nothing changes to NZD.
No difference to interest rate traders except to calculate trades from a negative perspective as ranges remain the same from negative to positive rates.
Used correctly by central banks, negative interest rates is a smarter move than positive rates as positive rate scales conceivably can shoot to infinity while Negative rates contains a known bottom at minus 0.0 and the top side is located at + 0.0, or +0.00 to -0.00. negative rates allow for smaller trade ranges.
For Monetary Policy, negative rates says much more as central banks since 2008 refuse to rescind stimulus and allow GDP and positive interest rates to skyrocket to allow populations and economies to experience economic prosperity.
Negative interest rates informs how much damage was caused over 12 years. Never forget the overall formula as interest rates and money supplies share an adverse relationship and done by central bank design. The more money is added to the system then the more interest rates drop. GDP under stimulus scenarios doesn’t contain any chances to rise to its natural level. Stimulus ensures interest rates and GDP remain lower for longer.
However Monetary Policy under negative interest rates without stimulus is actually a panacea to positive economics as interest and GDP ranges work inside a vast different corridor to overall price systems.
Further reads are Silvio Gesell “The Natural Economic Order” and Knut Wicksell “Interest and Prices”. Anything written by Knut Wicksell is a must read.
NZD/USD now approaches its vital 5 year average at 0.6809. A huge break and commentary to overall market prices as the bottom pair among all 28 informs all other currency pairs will follow NZD’s break. EUR/USD broke at 1.1200’s and GBP/USD is yet to follow at its 5 year average at 1.3196.
Brian Twomey
EUR/USD Day Trade
A person reported on Fxstreet to European interest rates. euribor crossed eonia in some certain way. Well this is useless information to EUR/USD day trade on this day.
EUR/USD From USD Interest Rates day trade today
EUR/USD
Long Short Line 1.1766
most Important 1.1716 and 1.1731 Vs 1.1773, 1.1781, 1.1788, 1.1796, 1.1811, 1.1818 and 1.1826
Bottom. 1.1706 achieves by 1.1736 and 1.1721
Upper target 1.1826
Continuation fail 1.1796
Break Point 1.1636
EUR/USD From ECB Interest Rates today for day trade
EUR/USD
Long Short Line 1.1766
most Important 1.1747 and 1.1755 Vs 1.1773, 1.1781, 1.1788, 1.1796, 1.1811, 1.1818 and 1.1826
Bottom. 1.1706 achieves by 1.1736 and 1.1721
Upper target 1.1826
Continuation fail 1.1796
Break Point 1.1636
Difference? 1 pip discrepancy to bottom. ECB has 1.1706 and 1.1707 while USD Fed has 1.1706. negligible.
Most Important 2 bottom points.
USD Fed has minus 50 and 36 pip supports. ECB has minus 19 and 11.
Break down Fed further, we have 25 and 18 pip supports.
However, both supports are located within today’s EUR/USD price path so nothing changed to EUR/USD despite the wasted words to Eonia/ Euribor cross over. God help these people
Brian Twomey
Weekly Trade Results: EUR/CAD and EUR/GBP
Weekly Trades as Posted Sunday
EUR/CAD.
1. Short 1.5667 and 1.5682 to target 1.5525.
Highs 1.5655, Lows 1.5527
Target Achieved
Trade Runs +128 Pips
2. Short 1.5473 to target 1.5301.Not traded
3. Long 1.5525 to target 1.5595.
Lows 1.5527, highs 1.5575
Trade Runs +48 Pips.
2 Trades, 3 days +176 Pips.
EUR/GBP
Short anywhere or 0.9266 if seen to target 0.9051.
Highs 0.9262, Lows 0.9094
Trade Runs +168 pips
3 trades, 3 days, +344 pips.
Note weekly Trades.
No charts, No graphs, No stops, No Fibs, No Indicators
No woulda, shoulda, looks like, maybe, probably, if this then that.
I know exactly what I’m doing as we trade continuous prices up and down or target to target.
Brian Twomey
Weekly Trades: EUR/GBP and EUR/CAD
EUR/GBP is severely overbought from the 5 day average, to the 50 day average, to the 253 day average, to the 5, 10 and 15 year average and to 4000 + day averages.
EUR/GBP overbought informs to the depth and degree of oversold GBP/USD. As mentioned in long term targets, GBP/USD broke big levels at 1.2998, 1.2892 and 1.2859 to achieve current 1.2700. On the way up, oversold GBP/USD must again break 1.2853, 1.2870 and 1.2928 to target 1.3000’s. The lower 1.2700’s GBP/USD drove EUR/GBP higher and this week the reverse will trade.
What allows GBP/USD higher are deeply oversold cross pairs as the GBP universe all now sits together in deeply oversold.
EUR/GBP is normally not a regularly traded currency pair because its a horrible currency and not worth clicks but a fairly easy trade is offered this week.
EUR/CAD is in the same overbought predicament as EUR/GBP and overbought from the 5 day average, 5, 10 and 15 year and overbought from 4000 + day averages. Long term target remains 1.5000’s.
EUR/GBP
Short anywhere or 0.9266 if seen to target 0.9051.
Short 0.8990 to target 0.8897.
Long 0.8897 to target 0.8959.
Long 0.9051 to target 0.9072.
EUR/CAD.
Short 1.5667 and 1.5682 to target 1.5525.
Short 1.5473 to target 1.5301.
Long 1.5525 to target 1.5595.
Brian Twomey
GBP and Market Crash, Melt downs and Melt Ups
Here’s the trade strategy question related to all trades, weekly and daily. I hark back to Peter Wadkins words. What happens if the market implodes, crashes or melts up or down. Is the trade strategy factored to all possible scenarios. The question is absolutely.
GBP/USD began the week at 1.3300’s. Here’s the main point to crash, and melt up or downs.
GBP/USD. Break Point 1.2998, below targets 1.2862.
Never expected the market to crash or melt up ow down but absolutely prepared. GBP/USD traded to 1.2772 lows and while we didn’t catch every pip, we caught the vast majority of traded pips.
GBP/JPY began the week at 141.00’s. Never expected a melt up or down but we’re prepared.
GBP/JPY. Break Point 138.54, below targets 137.43. GBP/JPY traded to 135.00’s. We didn’t catch every pip but we caught a vast majority.
GBP/CHF began the week at 1.2100’s. GBP/CHF traded to 1.1600 lows.
GBP/CHF. Break Point 1.2021, below targets 1.1966. We didn’t catch every pip but certainty prepared.
Not accounted was GBP/NZD and GBP/AUD however ironically, EUR/NZD and EUR/AUD this week resulted in good trades.
GBP/NZD and GBP/AUD extremely wide rangers but also becoming problem pairs and both are no associated to EUR/NZD or EUR/AUD.
The melt down for GBP this week and wise preparation compensated for GBP/AUD and GBP/NZD.
Markets and trades are prepared every week to trade normally as this has been the case for the past 3 and 4 years. But now and then an unusual week is seen. Yet unusual circumstances are factored and known at the start of every week.
Brian Twomey
USD/CAD and BOC
Canada’s CORRA or Canada Overnight Repo Rate Average from October 26 to Sept 4 traded 0.2300 to 0.2500 and a 7 day average at 0.2438.
Canada’s OMMFR or Overnight Money Market Finance Rate from October 26 to September 4 traded 0.2317 to 0.2380.
Canada’s main interest rates trade in correct positions as Corra above OMMFR. No Interest rate changes expected and no warnings or problems seen.
Canada’s Monetary Policy targets Inflation and Employment. Canada’s Inflation Control Target is operational for 30 years and has held Canada in good stead. 2% is the middle bound Vs 1 to 3%. July’s 0.1 Inflation reading contains a trimmed mean at 1.7% and median at 1.9%.
Canada’s latest Inflation tool is to trim Inflation means by discarding highest and lowest readings and include an Inflation Median. Changes are slight and doesn’t appear to impinge on the overall Inflation Control Target formula nor its effects.
As Canada is in the process to understand more fully Inflation Averages in relation to its economy and scheduled for a 2021 final release, 2 interesting developments at the July assessment.
if Inflation is low and allowed to run hot, the effects to Employment was negligible. However this issue will be revisited as Inflation and Employment is the BOE mandate.
One researcher and a concept I favor and use for economic indicators is to obtain a simple averrage for all economics, all releases and assess low and high averages. Its a simple concept and quite easy to run data rather than chart a Keynesian Phillips Curve trade off that may or may not work. New Zealand for example contains about 3500 data points to include 10 and 2 year bond yields and Bank Bill interest rates.
To raise or lower interest rates is assessed by Canada using the Output gap.
Canada’s 2020 Output Gap runs currently 0.042 and only Germany beats by 0.258. Remainder nation run negative Output Gaps as follows: Japan, UK, Europe, France, Italy. The United States runs barely negative but is expected to run positive upon the next GDP release.
Expected for 2021 Canada at 0.015, and a closing Gap while Germany, France, Italy and Europe are expected at 0.17, 0.164, 0.037 and 0.104. A positive Output Gap is the overall economic indicator to raise rates.
USD/CAD
The weekly trade we’re currently working on is this for the 2nd and 3rd legs.
2nd and 3rd legs\
Long above 1.3316 to target 1.3506.
Short 1.3262 to target 1.3119
The 1.3262 target achieved at 13258 for +215 pips from 1.3044.
But above is the weekly trade and may not trade today and maybe seen on Thursday or Friday.
Upon the 1.3262 target, USD/CAD traded to 1.3217 lows.
Rather than the weekly trade for the BOC, the day Trade is best. And why is because from 1.3270 to 1.3219 and 1.3115 is a terrible position for USD/CAD to trade the BOC release.
USD/CAD Day Trade
USD/CAD
Long Short Line 1.3251
Most Important 1.3196 and 1.3217 Vs 1.3259, 1.3267, 1.3284, 1.3292, 1.3301, 1.3309 and 1.3318
Bottom. 1.3184 achieves by 1.3217 and 1.3199
Upper target 1.3318
Continuation Fail 1.3285
Break Point 1.3322
Above says this from low to high and factored from interest rates.
1.3184, 1.3196, 1.3199, 1.3217, 1.3259, 1.3267, 1.3284, 13292, 1.3301, 1.3309, 1.3318
Note 1.3309 and 1.3318 converges against the break point at 1.3322.
The object for the BOC release is long bottoms and short tops. Don’t expect the overall range to break as this rarely happens. Its free money if ever rare range breaks happen because the price must trade back to its range by central bank mathematical standards. Not mine but central banks as they devised this day trade system.
What this system says overall is the price doesn’t care one iota to what the BOC reveals. They can talk and babble all day and the price system will hold.
One caveat. The BOC is expected to speak at 10:00 and this price system will then run on ECB standards.
So possible to see a slight adjustments to overall prices yet the same concepts hold, short tops and long bottoms for multiple trades and pips.
Brian Twomey
Weekly Trade Results: USD/CAD, CAD/JPY, CAD/CHF
Long 1.3004 and 1.2991 to target 1.3262.
Lows 1.3044, Highs 1.3234
2nd and 3rd legs
Long above 1.3316 to target 1.3506.
Short 1.3262 to target 1.3119
Short 81.37 and 81.58 to target 80.29
Highs 81.41, Lows 80.13
target achieved
2nd and 3rd Legs
Short below 80.07 to target 79.22
Long 79.22 to target 79.86.
Short 80.29 to target 80.74
CAD/CHF Weekly Trade as Posted
Short 0.7016 and 0.7038 to target 0.6961
Highs 0.7010, Lows 0.6961
target achieved
2nd Leg Short 0.6950 to target 0.6894.
Lows 0.6934 Trade Runs +16 pips
Total +65 pip
4 trades, 2 days, +383 Pips
Trades still running to Friday
Brian Twomey
Long Term Targets: 20 Currencies
Currency price commonality over the past 3 -4 years was a vast majority of the 28 pairs traded below 5 year averages, weekly trades and targets were 150 to 200 ish pips for 12 and 18 currency pairs and approximately 20 pairs traded miles below its ranges. A few examples.
GBP/USD upon the Brexit drop contained a long term target at 1.3600’s, the second year 1.3400’s and today 1.3200. EUR/USD in 3 years went from a 1.1600’s target to today 1.1400’s. AUD/USD in 3 years contained a target at 0.7800 to today 0.7200’s.
GBP/USD target dropped 200 pips per year, AUD/USD dropped 200 pips per year and EUR/USD dropped about 70 pips per year. All long term targets achieved destinations.
A long term target is a range price and must achieve its location to affirm a normalized price. View a normalized price as a price alignment. For the past 3 and 4 years, a vast majority of currency prices traded under non normal and non alignment status.
The difference between currency prices today from the past 3 to 4 years is most pairs trade within its own respective ranges however just barely.
The difference between a long term target price under non normal status and a price trading within its own range is non normal status offers a target, a direction, a trade, an understanding to price location. The opposite is true to a price within range.
Not known to a range price is a long term target, a direction, a trade yet an understanding to price location. A currency or any market price within range is a settled price and a dead price to trade within respective ranges. A price within its range is surrounded by vital averages and not able to move and a weekly trade that offers about 100 pip trade targets as opposed to 150 to 200 under non normal trade status.
Upon a long term target achievement, the price normally trades a long term reversal to then again re factor a long term target. This scenario highlights non normal markets again. The danger to a long term target completion is the range question as a price has every right to continue within its range or trade a long term reversal.
GBP/USD for example achieved its 1.3400’s target in 2019 then dropped to 1.2000’s and a spike low to 1.1400’s. GBP/USD today at 1.3200’s was the long term target re factored and written in mathematical stone and it doesn”t matter where trade lows are located.
From the 1.3400 target, GBP/USD went from normal to non normal or range to non normal and a 200 pip drop to 1.3200 to its long term target.
20 currency pairs were evaluated to long term model targets. The model is not only exact to pip targets as demonstrated a gazillion times but no need exists to run the model until a target is achieved. GBP/USD for example only required to run the model once per year over the past 3 years. Same for EUR/USD, AUD/USD and a vast majority of currency pairs.
To targets and ranges are trading right at 300 ish pips for most currency pairs.
GBP/NZD Vs EUR/NZD
A deep dysfunction exists between GBP/NZD and EUR/NZD. EUR/NZD trades safely above its 5 year average while GBP/NZD trades below. EUR/NZD averges are dropping while GBP/NZD averages are rising. Short term Correlations run +40% and should run much higher to inform a proper relationship. This won’t happen as GBP/NZD price is low and should trade much higher. Supports are located at 1.9400’s and 1.9500’s and the 5 year average at 1.9456.
EUR/NZD supports are located from 1.6900’s to 1.7200’s and trades within its range below 1.7685 and 1.7640. EUR/NZD’s price should trade much lower and informs a short only strategy far into the distant future.
EUR/AUD V GBP/AUD
Short term correlations run +93% and an extraordinary deception. GBP/AUD trades in a 900 pip range and a specific target is found inside its range. GBP/AUD wide range rarely if ever breaks as the price adjusts to overall GBP pairs within the GBP universe. Break of 1.8457 targets 1.8847. Massive supports are located from 1.8000’s to 1.8200’s.
EUR/AUD averages are dropping by the month and currently, EUR/AUD is miles overbought. EUR/AUD targets 1.5974 on a break of 1.6100’s. Above 1.6438 1.6444 and 1.6476, EUR/AUD heads higher to high 1.6500’s and low 1.6600’s. Recommendation is caution to longs above 1.6400 as shorts contain an easier 700 pip trade and because a EUR/AUD price above 1.6400’s doesn’t exist.
EUR/CAD
Long term target is 1.5019 and EUR/CAD at 1.5400’s is deeply overbought.
USD/CHF and CHF Cross Pairs: Deep oversold
USD/CHF massive resistance across all vital averages at 0.9600’s and all averages are deeply oversold to extremes. Long term target 1.9476.
AUD/CHf. Long term target 0.7030 and deeply oversold
NZD/CHF. Long term target 0.6510
GBP/CHF. Long term target 1.2562
CAD/CHF. Long term target 0.7378
EUR/CHF. Not worth the effort to trade.
USD/CAD Vs CAD/JPY
Range trades for both. USD/CAD strategy is short only as USD/USD at 1.3000’s should trade miles lower into low 1.2000’s. CAD averages are dropping however slowly. CAD/JPY however meets massive resistance at 83.00’s to 85.00’s.
AUD/USD, AUD/JPY, AUD/CHF.
AUD/USD and AUD/JPY long term target achieved at 0.7200’s and AUD/JPY 78.00’s. AUD/CHF price is low and oversold and the driver pair to higher AUD/USD and AUD/JPY.
GBP/CAD
A wide range currency pair and no target as GBP/CAD trades in wide ranges and ranges adjust to underlying USD/CAD and GBP/USD movements.
EUR/USD and EUR/JPY
EUR/USD big break 1.1452. Massive resistance 1.2300’s to 1.2500’s.
EUR/JPY range 123.23 to 129.08. Nothing special here.
GBP/USD and GBP/JPY
GBP/USD Big point 1.3205 Vs thick supports and many at 1.2800
GBP/JPY. Big Point 141.74, down from 147.00’s over 3 years or 200 pips per year.
NZD/USD
NZD/USD Big Point 0.6724. Range trade and nothing special here.
NZD/JPY. Big break point 71.69 and 71.51.
Best Long term trades: USD/CHF and CHF cross pairs, EUR/CAD, GBP/CHF, EUR/AUD. For CHF cross pairs best are GBP/CHF and AUD/CHF.
Oversold CHF cross provides supports to underlying NZD/USD, AUD/USD, GBP/USD but a far different arrangement to USD/CAD Vs CAD/CHF. USD/CAD is the driver pair to CAD/JPY and CAD/CHF.
All concepts found in levels, ranges and targets.
Brian Twomey
Weekly Trades: USD/CAD, CAD/JPY, CAD/CHF
GBP/JPY will lead JPY cross pairs lower this week. CAD/JPY begins the week overbought while USD/CAD launches from oversold. USD/CAD closed last week at 1.3096 and oversold while this week at the 1.3056 close remains oversold. Included this week is overbought CAD/CHF.
CHF cross pairs arranged as Other Pair/CHF has been running wide ranging to dead week after week. This week is dead ranger. A currency price is dead weekly due to either allow a currency pair within its orbit to perform its necessary porice function or a problem is located within correlations.
CAD/CHF Vs CAD/JPY correlates -25% and +49% to USD/CAD while USD/CAD correlates minus 96% to USD/CAD.
CAD/CHF contains a severe problem to USD/CAD as the correlation should run deeply negative because CAD/CHF is the complete opposite pair to USD/CAD as much as GBP/USD is the total opposite to USD/CAD.
The positive correlation from USD/CAD informs CAD/CHF price runs 50% of USD/CAD. But correct to alignment is CAD/CHF should contain a positive correlation to CAD/JPY and deeply negative to USD/CAD. The CAD universe however is vastly different to its counterparts.
AUD/CHF, NZD/CHF, GBP/CHF and EUR/CHF are bottom pairs with a lower exchange rate price in relation to AUD/USD, NZD/CHF, GBP/USD and EUR/USD.
The Other Pair/CHF purpose is to contain the price to non USD pairs so all don’t trade wildly or theoretically to zero. A non USD pair such as EUR/USD doesn’t have ability to cross below Other Pair/CHF. Instead the price adjusts up or down in relation to non USD pairs.
Overall, USD/CHF and CHF cross pairs as Other Pair /CHF are deeply oversold short, medium and long term. CAD/CHF and AUD/CHF contain the best long term trades for longs.
Deeply oversold CAD/CHF informs USD/CAD potential to trade miles lower is tremendous. USD/CAD averages over time have been dropping however slowly. USD/CAD currently trades between its 5 and 10 year averages from 1.3190 to 1.1893 against most vital averages at 1.2998, 1.2578 and 1.2382. CAD/JPY and CAD/CHF alternatively contain potential to trade miles higher.
USD/CAD
Long 1.3004 and 1.2991 to target 1.3262.
Long above 1.3316 to target 1.3506.
Short 1.3506 to target 1.3370.
Short 1.3262 to target 1.3119.
CAD/JPY
Short 81.37 and 81.58 to target 80.29
Short below 80.07 to target 79.22
Long 79.22 to target 79.86.
Short 80.29 to target 80.74.
CAD/CHF
Short 0.7016 and 0.7038 to target 0.6961.
Short 0.6950 to target 0.6894.
Long 0.6894 to target 0.6939.
Long 0.6961 to target 0.7004.
Brian Twomey
Weekly Trade Results: GBP/CAD, AUD/USD, USD/CAD
Brian Twomey
EUR/USD and 9 Currency Pair Forecasts
Upon the new 3 month review to my long term model that encompasses our 18 currency pairs traded weekly, nothing changed to EUR/USD.
In June. EUR/USD big break point to trade higher was located at 1.1987, today the big break point remains 1.1987.
Above 1.1987 then next comes the 10 year average at 1.2175 and a break targets 1.2400 to 1.2600’s. However, a total of 10 averages ranging from 1.2400’s to 1.2600’s face EUR/USD above 1.2175. At 1.2600’s represents top of the range to my averages dating to 1999.
The EUR/USD rise from 1.1200’s to 1.1900’s in 15 days was the result of not only a break of its high/ low point at 1.1200’s but the break higher of the 5 year average at 1.1288. EUR/USD was given the green light to move significantly higher.
EUR/USD became the first and leader currency to break its 5 year average. Then next was EUR/JPY at 124.00’s, GBP/USD 1.3216, AUD/USD was next to follow at 0.7282 and NZD/USD is close at 0.6806. USD/CAD broke at 1.3190.
Previously, 24 of 28 currency pairs lived for the past 3 and 4 years trading below 5 year averages.
Moving averages don’t change fast enough to consider or allow 1.2175 will break then trade to 1.2400’s to 1.2600’s anytime soon.
Due to 1.1987 and 1.2175, our strategy changed from long only to short only against a target to 1.1400’s.
Further Reviews
GBP/USD. Big break for lower is located at 1.3352 and this line broke Wednesday. Above 1.3352 then massive resistance is located at 1.3800’s and 1.3900’s. Below then next is the 5 year average now at 1.3218 then solid supports at 1.2800’s. Note 1.3300 ‘s to 1.3800’s is 500 pips and below 1.3300’s to 1.2800’s is 500 pips. We maintain a long drop strategy.
AUD/USD next big lines above are located at 0.7721 and range top at 0.7838. No changes to 0.7838 over the past 3 years as this line hasn’t changed.
AUD/USD big break lower is located at 0.7371 then the 5 year average at 0.7281 and 0.7050. AUD/USD 0.7371 to 0.7700’s is 400 pips and 0.7371 to 0.7050 is 300 pips.
AUD/JPY. 79.82 Vs 76.38. Above 79.82 targets the 5 year average at 80.46 then 81.33. No significant changes for AUD/JPY over years.
GBP/CAD break 1.7285 then the 5 year average targets 1.7000’s.
GBP/CHF Remains significantly depressed and targets 1.2562 easily. GBP/CHF must break 1.2365 to achieve 1.2500’s. Great currency pair and long drop strategy.
EUR/JPY. Lower must break 124.90, 124.82 and 124.68 to target massive supports at 123.00’s. Above 124.90 then EUR/JPY faces 10 averages from 127.00’s to 130.00’s. Higher must break 126.16. No thrills to EUR/JPY.
GBP/JPY higher must break 144.93 then 146.24 and 146.92. Below 144.93 targets 139.00’s and range bottom at 135.00’s. A far better pair to trade as opposed to EUR/JPY and AUD/JPY. Assumption is NZD/JPY will reveal the same small range movement as AUD/JPY. Meaning MA’s are to close to consider big moves.
Overall and a speculation from 8 currency pairs is currency markets are fairly stable again and prices in a decent equilibrium to ranges from 2 to 500 pips.
Further speculation is big moves will be seen in GBP/NZD, EUR/NZD, EUR/CAD, EUR/AUD, GBP/AUD and GBP/CHF. For JPY cross pairs will suffer except GBP/JPY. For USD/CAD was born a wide movement currency pair and significant moves higher are expected.
Brian Twomey
Weekly Trade Review: 18 Currencies
A vast majority of weeks over the past 4 ish years, no need exists to check entries, targets and results because currency markets were functioning perfectly. This means perfect entries and no questions to targets. Targets remain valid however despite normal vs Non normal markets. Normal weeks, targets always achieve destinations.
It also means a standard weekly 1000 ish pips per week on 10 and 12 currency pairs and 1000 to 1500 on current 18 currency pairs. The EUR/USD rise from 1.1200 to 1.1900’s in 11 days slightly skewed many currency pair prices for about 3 weeks but markets are pretty much back to normal. How do we know?
Entries informs to everything. and concepts to actual definitions to overbought and oversold.
Remember the standard entry formula to entry extremes 20, 50, 100 and 150. This formula doesn’t change across 28 currency pairs and it doubles easily to EM currency pairs.
Example. EUR/NZD and GBP/NZD contained divergence or a mix match to week’s beginning locations. GBP/NZD this week just achieved entry and EUR/NZD overshot by almost 100 pips. Both are now deeply oversold but both are also now in sync.
NZD/USD not much movement this week despite deep overbought as NZD shot higher by just shy of the 13 pip entry price and in line to the entry formula. NZD/USD against the falling EUR/NZD and GBP/NZD didn’t have ability to drop until EUR/NZD and GBP/NZD aligned properly., an agreement.
Remember trades are weekly and on the 4th day, look out below NZD/USD.
The opposite is true for GBPCAD in the GBP/USD Vs USD/CAD relationship as no divergence exists between GBP/USD and USD/CAD and this allows movements to GBP/CAD. When divergence exists between GBP/USD and USD/CAD then GBP/CAD trades tiny movements. Applies to EUR/CAD.
All GBP pairs began the week in deep overbought yet continued almost a 100 pip rise. The extra 100 pips are free money given freely by the market. Overall, GBP pairs performed beautifully.
Know and understand price paths and Currency pair price relationships is the overall message.
To targets, the commonality to 18 currency pairs over the past 3 weeks is 100 pip movements. This 100 pips applies and will apply to JPY cross pairs except GBP/JPY.
JPY pairs under performed. Upon inspection to the 3 month review to 18 currency pairs, JPY pairs are stuck and locked up and down by vital MA’s. The best of the bunch is GBP/JPY and NZD/JPY. while AUD/JPY and EUR/JPY are stiffed.
EUR/USD big break 1.1987 then 10 year average at 1.2175. EUR/USD performed this week perfectly due to 1.1987.
EUR/AUD and GBP/AUD on day 4 are working their way higher to weekly targets upon good entries.
AUD/USD and AUD/CHF were good trades and entries but slight miss to AUD/JPY. And quite unusual to AUD/JPY traditionally.
USD/CAD is on the way higher on day 4 but slow price movements higher. Unusual for USD/CAD as USD/CAD contains a free wheeling currency price.
Weekly Trades seen this week is entry anywhere as deep divergence existed between currency pairs. USD/CAD Vs GBP/USD for example. Entries literally didn’t matter as long as the trades were taken in the right directions. Rare for this to happen, especially on weekly trades.
GBP/USD for example dropped so far 117 pips from weekly entry price and 207 pips from market highs. Did entry matter? No
Weekly Trades
Favored trades this week: AUD/JPY, AUD/USD, AUD/CHF, EUR/AUD, NZD/JPY, NZD/USD, NZD/CHF, USD/CAD, EUR/USD, EUR/NZD, EUR/JPY, CAD/JPY
Note. Short or Long Anywhere because all our pairs are located at price extremes. Don’t wait for entry just enter and good to enter heavy and expect wide movements this week. Rare opportunity . EUR/USD is good but enter bit higher. Stand clear CAD/JPY and no thrills EUR/JPY. USD/CAD, AUD/USD and all GBP pairs are top picks to weekly list.
AUD/JPY. Break Point 74.91, below targets 73.06.
Strategy. Short anywhere or 77.65 and 78.11 to target 75.82. Must cross 77.42, 77.19, 76.96, 76.73, 76.50, 76.27 and 76.04. Short below 74.91 to target 73.06. Cautious long 75.82 to target 76.74. Long only strategy.
AUD/USD. Break Point 0.7028, below targets 0.6920.
Strategy. Short anywhere or 0.7381 and 0.7394 to target 0.7163. Must cross 0.7354, 0.7327, 0.7300, 0.7273, 0.7246, 0.7219 and 0.7192. Cautious long 0.7163 to target 0.7246. Long only strategy.
AUD/CHF. Break Point 0.6512, below targets 0.6435.
Strategy. Short anywhere or 0.66 5 and 0.6687 to target 0.6531. Must cross 0.6647, 0.6627, 0.6608, 0.6589, 0.6570 and 0.6551. Short below 0.6512 to target 0.6435. Cautious long 0.6531 to target 0.6589. Long only strategy.
EUR/AUD. Break Point 1.6480, above targets 1.6589.
Strategy. Long anywhere or 1.6136 and 1.6127 to target 1.6444. Must cross 1.6172, 1.6208, 1.6244, 1.6280, 1.6316, 1.6352, 1.6388 and 1.6424. Long above 1.6480 to target 1.6589. Cautious short 1.6444 to target 1.6335. Short only strategy.
NZD/JPY. Break Point 69.34, below targets 68.55.
Strategy. Short anywhere or 71.10 and 71.34 to target 69.63. Must cross 70.90, 70.70, 70.50, 70.30, 70.10, 69.90, and 69.70. Short below 69.34 to target 68.55. Cautious long 69.63 to target 70.13. Long only strategy.
NZD/USD. Break Point 0.6504, below targets 0.6391.
Strategy. Short anywhere or 0.6759 and 0.6773 to target 0.6533. Must cross 0.6731, 0.6703, 0.6675, 0.6647, 0.6619, 0.6591, 0.6563 and 0.6535. Short below 0.6504 to target 0.6391. Cautious long 0.6533 to target 0.6618. Long only strategy.
NZD/CHF. Break Point 0.6029, below targets 0.5987.
Strategy. Short anywhere or 0.6103 and 0.6114 to target 0.6031. Must cross 0.6082, 0.6061 and 0.6040. Short below 0.6029 to target 0.5987. Cautious long 0.6031 to target 0.6072. Long only strategy.
USD/CAD. Break Point 1.3371, above targets 1.3513.
Strategy. Long anywhere or 1.3066 and 1.3044 to target 1.3324. Must cross 1.3111, 1.3134, 1.3157, 1.3180, 1.3203, 1.3226, 1.3249, 1.3272, 1.3295 and 1.3318. Long above 1.3371 to target 1.3513. Cautious short 1.3324 to target 1.3182. Short only strategy.
EUR/USD. Break Point 1.1574, below targets 1.1435.
Strategy. Short 1.1956 and 1.1974 to target 1.1713. Must cross 1.1922, 1.1888, 1.1854, 1.1820, 1.1786, 1.1752 and 1.1718. Long 1.1713 to target 1.1852. Long only strategy.
EUR/NZD. Break Point 1.7795, above targets 1.7912.
Strategy. Long 1.7601 and 1.7580 to target 1.7775. Must cross 1.7619, 1.7638, 1.7657, 1.7676, 1.7695, 1.7714, 1.77331.7752 and 1.7771. Long above 1.7795 to target 1.7912. Cautious short 1.7775 to target 1.7639. Weekly strategy.
EUR/JPY. Break Point 123.37, below targets 122.29.
Strategy. Short 125.79 and 126.06 to target 123.90. Must cross 125.52, 125.25, 124.98, 124.71, 124.44 and 124.17. Cautious long 123.90 to target 124.98. Long only strategy.
CAD/JPY. Break Point 79.76, below targets 78.98.
Strategy. Short 80.70 and 80.85 to target 79.92. Must cross 80.54, 80.38, 80.22, 80.06 and 79.90. Short below 79.76 to target 78.98. Long 78.98 to target 79.61.
GBP
Favored trades this week: GBP/USD, GBP/JPY, GBP/CHF, GBP/CAD, GBP/AUD, GBP/NZD.
GBP/USD. Break Point 1.2923, below targets 1.2806.
Strategy. Short anywhere or 1.3361 and 1.3391 to target 1.3098. Must cross 1.3332, 1.3303, 1.3274, 1.3245, 1.3216, 1.3187, 1.3158, 1.3129 and 1.3100. Long 1.3098 to target 1.3157. Long only strategy.
GBP/JPY. Break Point 137.76, below targets 136.08.
Strategy. Short anywhere or 140.88 and 140.98 to target 138.77. Must cross 140.47, 140.06,, 139.65, 139.24, 139.03 and 138.82. Long 138.77 to target 139.43. Long only strategy.
GBP/CHF. Break Point 1.1978, below targets 1.1889.
Strategy. Short anywhere or 1.2085 and 1.2102 to target 1.1996. Must cross 1.2068, 1.2051, 1.2034, 1.2017, 1.2001 and 1.1983. Short below 1.1978 to target 1.1889. Long 1.1889 to target 1.1951. Long only strategy.
GBP/CAD. Break Point 1.7270, below targets 1.7187.
Strategy. Short Anywhere or 1.7498 and 1.7509 to target 1.7291. Must cross 1.7478, 1.7458, 1.7438, 1.7418, 1.7398, 1.7378, 1.7358, 1.7338, 1.7318 and 1.7298. Short below 1.7270 to target 1.7187. Cautious long 1.7291 to target 1.7353. Weekly strategy.
GBP/AUD. Break Point 1.8406, above targets 1.8561.
Strategy. long 1.8018 and 1.7979 to target 1.8329. Must cross 1.8056, 1.8094, 1.8132, 1.8160, 1.8198, 1.8236, 1.8274 and 1.8312. Short 1.8329 to target 1.8223. Weekly strategy.
GBP/NZD. Break Point 1.9871, above targets 2.0004.
Strategy. Long 1.9693 and 1.9663 to target 1.9849. Must cross 1.9715, 1.9737, 1.9759, 1.9781, 1.9803, 1.9825 and 1.9847. Long above 1.9871 to target 2.0004. Short 2.0004 to target 1.9938. Weekly strategy.
Brian Twomey
BRIAN TWOMEY ON TRADING 