The nearest prospects for USD. Andrew Green.4.01.2018, 02:00 PM
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My name is Andrew Green. I am a professional trader of the Forex market and a partner of Ester. Starting from January 2018 you will have the opportunity to read my articles and to get acquainted with trade recommendations on the website of the Company.
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For an effective acquaintance, today, we will discuss the question “The nearest prospects for USD”, which is already slightly worn out, but which has not lost its relevance.
Trade recommendation: SELL – EUR/USD
Rationale: Yesterday (January 3, 2013) in the article of Anton Hanzenko, we had an opportunity to get acquainted with the current situation on the USD (USDX, DXY, Index USD) index. And as we see on the graph (Figure 1), this indicator forms a stable consolidation with obvious signs of a reversal figure – a triple bottom, and on the evening of January 3, we see obvious signs of breakdown of this figure, followed by the prospect of growth to the levels of 92.4- 92.6. In general, for a short-term trade purchase, it is a very good opportunity.
In turn, yesterday at 20:00 UTC, also the FOMC protocols were published (Federal Open Market Committee). They did not surprise the market, but it should be noted that these protocols only confirmed the earlier announced forecasts of Janet Yellen (acting chairman of the FOMC), about the revision of the US GDP growth for 2018 from 2.1% to 2.5%. Such data, in turn, increase the chances for a further more active increase in the discount rate for federal funds, and on the whole form a positive sentiment for the purchase of USD.
Since most traders use this indicator (USDX, DXY, Index USD) to a greater extent as informative, it is worth discussing separately which of the basic instruments of the currency market is more suitable for trading today. I tend to the EUR/USD pair. Especially to trade in contrast to the single European currency. I will try to explain my position now. To do this, let’s take a look at the medium-term data on the pair (Figure # 2).
As you can see, today the pair has approached strong resistance zones both on the day timeframe and on the week one. These are the zones 1.21-1.23. Given the facts already mentioned above, in order to strengthen the dollar’s position, and still not the ECB’s specific policy, with regard to further increases or tightening of borrowing conditions in Europe, I presume at least a strong flat movement in this range. I even find quite realistic the formation of reverse correction and the second vertex (timeframe D1) with subsequent processing to levels 1.10-1.13.
So as not to delve into the vicissitudes of the medium-term technical analysis, for short-term trading I propose to sell the EUR/USD pair from the current positions with a control averaging in the ranges 1.21-1.23. If you are trading without averaging, then consider entry pointgs into areas close to round levels (1.2080-1.2100) with stops 30-35p. Expected profit on such transactions is 40-55 points)
Examples of transactions:
- conservative option:
EUR / USD Sell limit 1.2090, SL 1.2115, TP 1.2040
- aggressive variant:
EUR / USD Sell (from current positions), SL 1.2140, TP 1.1750
EUR USD Sell limit 1.2090, SL 1.2140, TP 1.2040
Be careful when trading, clearly control your Money Management. If this term has led you into the jungle of vague memories or into complete misunderstanding, then you can revise basics of during one of the training courses, and also consult me personally, sending your question to my mail: email@example.com
Stay vigilant, but remember: we earn only when we trade)