31 Oct: Trend table outlook for FX, Commodities, Indices

By | October 31, 2018

The stock markets have consolidated on Tuesday, allowing the short term momentum indicators to recover a little and they now look mildly positive, suggesting that there could be further gains ahead. The longer term charts though still point lower, hinting that selling rallies does remain the overall theme. Note that the dailies are now becoming oversold so some caution is required..

In the FX markets, conditions have been mixed, with the EU majors generally under pressure, while the commodity bloc currencies are firm against the US$. This looks set to continue and the Aud and the Kiwi both seem set to outperform on the crosses, so trading from the long side of either Aud to Kiwi against the Euro or Sterling may be a plan. I would leave the Chf and the Jpy out as they could turn quickly higher if we see a return of safe-haven demand.

EurUsd and GbpUsd in particular look very heavy and selling rallies is preferred. I would rather trade the Euro than Sterling because of the Brexit uncertainties.

Commodities look more mixed today and are possibly best left alone right now, but as I said yesterday, WTI reached up to 67.23 on Tuesday before falling hard to 65.30, breaking the long term support, before recovering to finish the day at 66.15, right on the rising trend support. The dailies do still point lower though, so selling rallies remains the overall theme.

Economic data highlights will include:                                                         

Wed: NZ Building Permits, ANZ -NZ Activity Outlook, Business Confidence, Australian Private Sector Credit, CPI, China Mfg/Non-Mfg PMIs, BOJ Interest Rate Decision/Press Conference/Statement, Japan Housing Starts, Construction Orders, Consumer Confidence Index, German Retail Sales, EU Unemployment, CPI, US ADP Jobs data, Chicago Purchasing Managers Index.

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*Trade of the day: October 31, 2018 8:08 AM(AET)                          

*This is a personal opinion only, based on the look of the table below, and carries no guarantee of success.

All trades are good till 5.00pm NY time. All “in the money trades” should have the SL raised to break-even, or managed manually. All “out of the money trades” should keep original SL in place.

Sell EurUsd @ 1.1400. SL @ 1.1450, TP @ 1.1300

Range Trade: US$Jpy: 112.50 /113.50 (SL 30 pips either side)

Range Trade: AudUsd: 0.7140/0.7040 (SL 30 pips either side)

Range Trade: EurUsd: 1.1280/1.1380 (SL 30 pips either side)

Sell AudUsd @ 0.7135. SL @ 0.7165, TP @ 0.7025

Sell WTI @ 67.00. SL @ 67.80, TP @ 64.50

Sell GbpAud @ 1.7925. SL @ 1.8020, TP @ 1.7650