Current Market Sentiment – Forex Trading Tips

Today we will be monitoring levels of support and resistance in unison with any impactful news and the underlying fundamentals in order to find a high probability trade. Support and resistance includes previous highs and lows (horizontal s/r), trendlines, moving averages, Fibonacci retracements, daily pivot levels and round numbers. These levels of support and resistance are most effective when there are several of them converging at the same area (confluence). Read through my analysis of a Current Market Sentiment in order to prepare for the upcoming trading opportunities.

Current Market Sentiment:

Yesterday’s NY session saw volatility with euro rallying on the back of hopes for a Greek deal. EURJPY rallied 135 pips on the day. A deal seems to be on the horizon as creditors assess Greece’s most recent proposal. However we continue to hear both positive and negative comments regarding the formalisation of a deal.

Today’s Asian session saw Chinese HSBC Flash Manufacturing PMI come in close to expectations, however it showed a fourth consecutive month of contraction despite marking a 3-month high. The Shanghai Composite Index extended it’s losses from recent sessions, making fresh lows and marking the biggest sell-off in 7 years.

During Asia we have seen a sudden and strong rally in the greenback with EURUSD and GBPUSD falling 90 and 65 pips respectively. Meanwhile USDJPY has rallied 45 pips on the day. There has been no specific news causing this dollar strength, but it is in line with the fundamentals given the prospects of a Fed rate hike in coming months. Today’s Durable Goods orders may provide further clarity regarding the timing of a hike.

JP Morgan have brought forward their expectations for another RBNZ cut and now see the action in July. Twelve out of seventeen analysts expect the RBNZ to cut rates to 3% on July 23rd, while Credit Suisse OIS market has priced in a 74% chance of a 25bps rate cut.

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About the Author
Jarratt Davis is the world’s ranked #2 (2008-2013) Forex Trader by Barclays FX Hedge Index, following years of mastering his art as a self employed trader Jarratt has now entered the field of education and delivers the most robust Forex education package on the market. Jarratt’s mentorship is one of the only programs on the market that is conducted by a verified professional trader. Forex Alchemy readers can get the FREE mini course where Jarratt gives away some of his secrets to success by Clicking Here... [space height="20"] [social type="facebook"][/social] [social type="twitter"][/social] [social type="google-plus"][/social] [social type="youtube"][/social]

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