A1 Trading Company

Ticker tape by TradingView

June 30, 2022

USD, CHF & JPY Are All Buys Right Now

Frank Cabibi

It is risk-off time in the markets, and that sentiment is not going anywhere any time soon. Short term bullishness on speculative plays have not been able to maintain and dip buyers are feeling the frustration. Here is why the dollar, franc and yen are buys right now and will be for some time.

Global Recession

Policy makers and political authorities may tell you otherwise, but we are already in a global recession. Stocks are sinking, businesses are letting go of employees, consumers are spending substantially less, and stagflation is very present. Monetary leaders are taking measures, and we are well aware, but this doesn't mean we will see relief in the short run.

What we would need to see before traders and go back to risk-on is an improvement in economies around the world with a receding inflation rate. Otherwise, there will be no strength in the markets, and every bounce in speculative currencies will only serve as short setups.

Global Inflation

buys right now
US CPI
buys right now
Europe CPI
buys right now
UK CPI
buys right now
Australia CPI

Secondly, Global inflation is taking its toll. Each month continues to ride higher even as interest rates rise. In a period of stagflation, economies kind of enter a state of limbo where nothing seems to be improving for the time being.

The 'soft landing' expectation raised some eyebrows early on and now seems to be unattainable now that inflation is as high as it is. Investors expect to see a rocky landing, the only question is how rocky.

Consumer Spending Falls

Additionally, as prices rise, spending falls. Consumers are forced to spend less due to the rapidly increasing rise in goods and services excluding food and energy. This suggests that people lack the confidence in the economy and are not spending it on vacations or activities of leisure.

More money in the pillow case and less in the market means nothing good for things like stocks or risk-on currencies.

Trade Setups

GBP/USD

buys right now

GU is higher during the NY session after price has retraced considerably from the highs. Price is now under support in the 1.21500s but is showing upward pressure from the recent hammer candle on the 4H timeframe. If sentiment remains weak along with economic growth, the pair may test the lows around the 1.19300s.

AUD/CHF

buys right now

Next, Australia's buck has been very weak against the franc, and this recent bounce gives an opportunity to the short side. A key level of support lies about 70 pips below on the 1D around 0.65123. Price just hit resistance and is retracing from that level, and depending on today's close, it may come down further.

EUR/JPY

buys right now

Finally, euro-yen shows some bullishness today. However, recent price action suggests that the pair has topped out and struggles to move higher than the 144s. Price hit some clean support on the 4H timeframe and rose back above a supportive trend line. A potential short setup lies at 142.500 should price move that high.

A1 Edgefinder

Smart Money Tracker
See where big money is flowing with the A1 Edgefinder's smart money tracker! With one click, see where the biggest money flows are entering and exiting through COT data.

40% off code: 'READER'

GET ACCESS NOW

Subscribe

FREE ANALYSIS
Sign up for FREE trade alerts and Edgefinder forecasts!
SUBSCRIBE
Listen to More Episodes
Kiwi Dollar Spike Tomorrow?

While today is relatively uneventful in terms of major economic news around the world, this will not be the case for long. There is a chance that the forex market could witness a Kiwi Dollar spike tomorrow due to the Reserve Bank of New Zealand (RBNZ) announcing their latest interest rate hike at 8 pm […]

Read More
4 Pairs to Be Wary Of

As many of you already know, the EdgeFinder, A1 Trading’s market scanner software, can be incredibly helpful for discerning which securities are especially worth watching for potential trade setups. Whether you are planning on buying or selling a currency pair, commodity, bond, or more, EdgeFinder analysis is so robust that its ratings and biases can […]

Read More
UK CPI Data Mislead Markets Today

This morning at 2 am Eastern Time, the Office for National Statistics reported the latest monthly round of Consumer Price Index (CPI) and Core CPI increases within the United Kingdom’s economy. Annual CPI, which had been forecasted to hit 10.7%, instead jumped by an astonishing 11.1%, making for another multidecade high; annual Core CPI also […]

Read More
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
Home
Edgefinder
VIP
Menu
homesmartphonelaptopmenu linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram