Financial markets weekly overview for January 29 – February 4
We make up a weekly medium-term trade list based on CFTC reports and technical analysis.
The overview provides a description of the technical condition of the market on the most popular financial instruments, as well as information on the large speculators’ actions according to the last COT reports and the previous period.
Trade list in a graphical format is available here.
If you want to get more information on the pullback trading tactics and other aspects of trading in the market, watch the «Horizontal levels in trading» video course.
E-Mini S&P500 (ESH18)
The trend is bullish and the impulse wave develops. New pullback buying opportunities on the Daily timeframe will appear after the correction formation. The price movement is very active that’s why the reliable market entry is also possible on smaller timeframes. Long positions will remain relevant until the market is the nearest support level on the Daily timeframe, the lows of December 29 – January 2.
COT net position indicator reversed, large speculators are buying and the professionals’ opinion corresponds to the medium-term trend direction. To become a successful trader, read more about risk management methods.
Dollar Index (DXY)
The American dollar remains in the medium-term bear trend. Another impulse wave develops on the Daily timeframe and a pullback selling opportunity will appear after the correction formation. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of January 17 – 19.
CFTC reports indicate that large speculators go on selling the dollar, hedgers are buying and the professionals’ opinion corresponds to the Daily trend direction.
Euro (EURUSD)
Euro remains in the uptrend and the resistance level was broken on the Daily timeframe on Wednesday. The impulse wave develops, a pullback entry point will appear after the correction formation on the Daily timeframe.
COT indicator increases, large speculators are buying Euro and the professionals’ opinion corresponds to the market technical picture. EURUSD long positions will remain relevant until the price is above the relevant support level, the lows of January 17 – 22.
Swiss Franc (USDCHF)
USDCHF currency pair remains in the medium-term bear trend and the market broke through another minimum last week. The impulse wave develops, a pullback signal on the Daily timeframe will appear after the correction formation.
CFTC reports indicate that large speculators go on selling franc. Professionals’ opinion doesn’t correspond to the Daily trend direction and it makes sense to reduce the position size when an entry point appears in the trend direction.
British Pound (GBPUSD)
British pound remains in the strong medium-term bull trend and the impulse wave develops. A pullback buying opportunity will appear after the correction formation. Long positions will remain relevant until the market is above the support level, the lows of January 10 – 11.
CFTC reports indicate that large speculators go on buying Pound and hedgers are selling and the professionals’ opinion corresponds to the Daily trend direction.
Japanese Yen (USDJPY)
USDJPY currency pair remains in the bear trend on the Daily timeframe and another minimum was broken last week and the impulse wave develops. USDJPY short positions will remain relevant until the market is below the resistance level, the highs of January 17 – 19. The price movement is very active, that’s why the reliable market entry is also possible on smaller timeframes.
WTI Crude Oil (CLH18)
The oil market remains in the strong uptrend and the correction on the Daily timeframe came to an end last week, another impulse wave develops. Long positions will remain relevant until the market is above the support level, the lows of January 19 – 22.
COT net position indicator still increases along with the market. Professionals’ opinion corresponds to the Daily trend direction.
Canadian Dollar (USDCAD)
USDCAD medium-term trend remains downward, the pair broke through another support level last week. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of January 19 – 22.
CFTC reports indicate that large speculators began to buy the Canadian dollar and hedgers are selling and the professionals’ opinion corresponds to the market technical picture again.
Gold (XAUUSD)
The gold market remains in the bull trend. The market returned to the last broken level last week and bounced off it. Another impulse wave develops, long positions will remain relevant until the market is above the support level, the lows of January 18 – 22.
Large speculators go on buying and hedgers are selling and the professionals’ opinion corresponds to the technical picture.
Silver (XAGUSD)
The resistance level was broken on the Daily timeframe on Thursday, the trend is bullish and the market is in the correction. The market broke through the triangle formed earlier in the direction that corresponds to the professionals’ opinion. A pullback buying opportunity will appear after the correction completion on the Daily timeframe.
At the same time, CFTC reports indicate that large speculators began to sell actively and hedgers began to buy. Professionals’ opinion doesn’t correspond to the technical picture and it makes sense to reduce the position size when an entry point appears in the trend direction.
Australian Dollar (AUDUSD)
The Australian dollar remains in the uptrend and the impulse wave still develops. A pullback buying opportunity on the Daily timeframe will appear after the retracement. Long positions will remain relevant until the market is above the support level, the lows of January 9 – 10. The price movement is very active, that’s why the reliable market entry is also possible on smaller timeframes.
Large speculators are buying and hedgers are selling. Professionals’ opinion corresponds to the Daily trend direction.
New Zealand Dollar (NZDUSD)
The trend is bullish, the correction develops on the Daily timeframe. A pullback buying opportunity will appear after its completion. Long positions will remain relevant until the market is above the support level, the lows of December 20.
The price movement is very active, that’s why the reliable market entry is also possible on smaller timeframes. CFTC reports indicate that professionals’ opinion corresponds to the technical picture.
Russian rouble (USDRUB)
USDRUB currency pair remains in the medium-term bear trend, the market broke through another support level and the correction develops. A pullback entry point will appear after its completion. CFTC reports indicate that general opinion of professionals still corresponds to the technical picture.
Conclusions
In terms of medium-term trading, financial instruments with the correction close to completion on the Daily timeframe and with potentially the most promising risk-reward ratio are EURAUD, NZDUSD.
In the near future gold, silver, USDRUB, GBPAUD, GBPJPY can become noteworthy depending on the market correction depth.
Other financial instruments in the trade list may be also interesting, but in these markets pullback signals on the Daily timeframe are likely to occur no earlier than a week.
More information on the topic:
- The role of support and resistance levels in the trading plan
- Trading tactics. Breakout trading and pullback trading
- How to use CFTC reports in trading. General concepts
- How to use CFTC reports in trading. The logic of large speculators
Good luck in trading!
