For some consecutive weeks, smart money has shown an increased level of interest on commodities like gold and oil. In a time where market uncertainty spikes and economic news is mixed, safety may be sought in these sorts of assets. Here are some analysis on commodities and the currencies that behave similarly to those assets.
EURJPY is a buy at +5. EUR is beating JPY in all categories except inflation, unemployment and GDP growth. This pair tends to be bullish in the month of April as retail goes short. Smart money is heavily interested in euro while also heavily short the yen.
EJ test a resistance level again around the 144.200s and is showing strong momentum to the upside. The Yen looks weaker as of late due to the COT reports making it the most shorted currency on the market. Price action may lead to a test around the double top at 145.600s. Because this is such a key level, and the pair has a handful of attempts here, we may see a break to higher on euro strength.
Kiwi-CAD looks to have momentum to the downside on the 1D timeframe. Price has been in a downward channel for several months and may continue its move lower. It looks like price may complete the move to the bottom of the flag pattern around 0.82900s. CAD has not been very strong, but COT has a heavy interest in oil which is by default, bullish for Canada’s currency.
The pair is now at a -3 sell rating on the EdgeFinder. This is predominately due to technical factors such as trend reading, seasonality, retail and smart money sentiment. Retail could be long Kiwi as a result of higher interest from the RBNZ, but it is still not a healthier currency or economy than Canada.
SPX touches the top of a falling trend line last week and could not break higher. It looked like there would be a second test before today’s candle shook price lower. COT shows a decrease in long activity overall. In the mid term, the index could come down to test the bottom of the wedge which is around $3900s.
At +3 on the EdgeFinder, stocks are looking at a positive growth month for the month of April. A reason why this could be a momentum play is the fact that smart money is not as interested in the stock market right now.
The crowd is between mixed and bearish sentiment around commodities and indices. GER30 (Germany) being the most bearish among retail, and JP225 (Japan) being the most bullish. This week is going to have lots of economic data which will likely cause more mixed sentiment and range-bound assets.
Smart Money Spotlight
Our Smart Money Tracker measures change in COT activity each week. A pattern we have been noticing is that institutions are staying long in JP225, USOil, and gold. At the same time, they remain bearish on assets like JPY, CAD and SPX/NAS. When big money buys into a falling asset, it's a sign that price is getting ready to shift as we have seen in the Japanese stock market and oil.
Of the three risk off currencies, Swiss's unemployment rate remains the healthiest. The US continues to struggle with unemployment in comparison even though the rate came down last week from 3.6%. One thing investors are concerned about is whether or not the Fed will decide to take another rate hike after NFP beat expectations and drew UE rates down a tad.
It will be important to monitor US unemployment as well as CPI this upcoming Wednesday for future Fed predictions.
AI- Generated Trading Setups
AI-generated bullish/bearish bias setups on forex currencies, gold, & indices.
Today's economic figures came out in US and Canada. GDP came in higher than expected in Canada while the price of goods purchased by consumers was lower than last month. Here are some pullback ideas for USD and CAD from GDP and PCE numbers. EdgeFinder Analysis NAS100 is a bullish reading on the EdgeFinder still. […]
This week has brought more inflation data with it regarding the USD's PCE and PMI numbers. Powell is also set to speak this Friday about monetary policy going forward. The RBNZ will also release their latest interest rate news tomorrow with expectations of an unchanged rate at 5.5%. EdgeFinder Analysis GBPUSD is a bullish bias […]
This week is a big PMI week for Europe, UK and US. Additional inflationary metrics will add to the overall sentiment of these countries' monetary policies going forward. Here are some setups for the coming week on these currencies. EdgeFinder Analysis GBPCAD is now a +7 on the EdgeFinder as we wait for CPI news […]
DISCLAIMER: All comments made by TraderNick’s Forex Group, LLC are for educational and informational purposes only. All comments should not be construed as investment advice regarding the purchase or sale of any securities or financial instrument of any kind. Please consult with your financial adviser before making an investment decision regarding any securities or financial instruments mentioned by TraderNick’s Forex Group, LLC. TraderNick’s Forex Group, LLC assumes no responsibility for your trading and investment results. All information on any of the platforms utilized by TraderNick’s Forex Group, LLC was obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. TraderNick’s Forex Group, LLC, its employees, representatives, and affiliated individuals may have a position or effect transactions in the securities and financial instruments herein and or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies. Trading of any type involves very high risk and may not be suitable for all investors. TraderNick’s Forex Group, LLC, its subsidiaries and all affiliated individuals assume no responsibility for your trading and investment result. Read our full disclaimer here
There is a significant degree of risk involved in trading securities. With respect to foreign exchange trading, there is considerable risk exposure, including but not limited to, leverage, creditworthiness, limited regulatory protection and market volatility that may substantially affect the price, or liquidity of a currency or currency pair. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. The vast majority of retail client accounts lose money when trading in CFDs. You should consider whether you can afford to take the high risk of losing your money.