Catch up on CFTC data for the British Pound. We had a further small increase in net shorts to almost 95k contracts, and whilst it is an increase the rate has most definitely slowed. Keen to see this week's number to see if we are about to see the beginning of an unwind.
What was also significant in last week's numbers was a reduction in euro shorts by almost 16k contracts, which is interesting, and worth watching as well. ... See MoreSee Less
Many thanks if you came along to this morning's webinar where we covered some ways of using multiple time frames. MTF analysis is something we all have to get to grips with, and can be very confusing when we first start, not least because each time frame will be telling its own story.
However, get to grips with it we must, and the first step is establish our own personal trading field of vision, and sticking with it.
In having to spend so much time writing the modules for our courses has meant David & I moving away from the faster time frames, to the daily, hour & four hour to look for trades that have a high probability of moving steadily throughout the session, and potentially rolling on for a few days.
In the past few weeks we've had some great results trading the gbp/jpy, eur/jpy, and aud/usd.
This morning we considered the nzd/jpy primarily because the daily chart for the csi is now showing some strong momentum to the downside for the jpy, which is no great surprise given recent performance in the Nikkei.
What has been interesting about the nzd/jpy is the relentless march higher for the pair since it's move off the 72.20 support region. The result has been a move back to the VPOC (volume point of control at 74.52 on reasonable volume, given the time of year.
In this morning's London session we only had a minor correction of this trend where the pair failed at 74.83 offering scalpers the opportunity to take some pips, and longer term traders to consider building on any positions.
74.83 is now the level to watch along with 74.86 (current session high), and with markets waiting for the US the pair may simply consolidate until then.
We will certainly be returning to this pair in this afternoon's webinar as it tells us so much about MTF, as well as what to consider when price is trading around the session highs (or lows). Hope you can join us. ... See MoreSee Less
Thanks to everyone who came along to this morning's webinar where we considered GBP in the light of the extreme numbers at the CFTC (90k+ short contracts). As I've mentioned in several posts already, this data becomes of great interest when we have these extremes. Gold is another example, and is a chart we will be considering in this afternoon's webinar.
For sterling, yesterday was the first day buyers stepped into the market with any degree of conviction with cable posting an impressive bullish engulfing candle on the daily chart. However, one swallow does not make a summer, and we will have to wait & see if sterling manages to hold up in the coming days and weeks.
Today's main news (other than the oil inventories) is the FOMC minutes, so focus very much on the USD & USD/JPY. The latter has a huge 1.32bn worth of contracts with a strike price of 100 due for expiry today, A big psychological number with a lot riding on it!
David & I tend to stick with the net shorts & longs at the CFTC, but not everyone does which makes interpreting this data a bit tricky. Taking the gross number is also valid & here's an alternative view. Both numbers for sterling at at extremes, and article also includes numbers for other instruments: