Month: January 2021

From January 3rd long term forecasts, last week compared 8 trade days while today another trade week is viewed from most significant MA’s.

AUDUSD January 14th

AUD/USD: 0.7498 Vs 0.7821 or 323 pips
Last week: 0.7530 Vs 0.7821 or 291 pips and a 32 pip compression to overall ranges.
This week: 0.7535 Vs 0.7821 or 286 pips and a 5 pip compression from last week and 37 pips overall in 3 weeks.

Between 0.7535 and 0.7821 are minor levels to trade weeklies. This week for example 0.7723 to 0.7629 or 0.7582 to 0.7629.

January 9th, AUD/USD opened the week at 0.7765 then opened January 16th at 0.7700 or a 65 pip week.

January 16 to 23, AUD/USD opened at 0.7700 to close at 0.7710 for a 10 pip difference.
January 23rd to January 30 AUD 0.7710 Vs 0.7637 or 73 pips.

EUR/USD

EUR/USD January 14 Significant MA’s as follows: 1.2119, 1.2020, 1.2038 Vs 1.2630.
From 1.2119 to 1.2630 = 511 pips.
Last week: 1.2116, 1.2020, 1.2030 vs 1.2628. From 1.2116 to 1.2628 = 512 pips.
EUR/USD moved 1 pip in 8 trade days.

This week: 1.2113, 1.2020, 1.2034 Vs 1.2627 = 514 pips
EUR/USD gained 3 pips to its overall range in 3 weeks.

Weekly January 9 to 16, EUR/USD opened at 1.2216 and closed 1.2074 or 142 pips.

January 16 to 23rd: 1.2074 to 1.2169 or 95 pips
January 23 to 30th: 1.2169 to 1.2132 or 37 pips.

USD/CAD

USD/CAD January 14 Significant MA’s as follows: 1.2586 Vs 1.2924 and 1.2976. From 1.2586 to 1.2976 = 390 Pips.

Today. 1.2586, 1.2886 and 1.2976 or 390 pips and no change over 8 trade days.
This week: Today. 1.2586, 1.2886 and 1.2976 or 390 pips and no change.

January 9 to 16: 1.2684 to 1.2736 or 52 pips.
January 16 to 23rd: 1.2736 to 1.2729 or 6 pips.
January 23rd to 30th: 1.2729 to 1.2773 or 44 pips.

Canada Interest Rates
From last week. Corra 0.1900 Vs OMMFR 0.1908. USD/CAD failed to sustain its break 1.2886. Longs and shorts for longer periods are in do or die mode.

GBP/USD

GBP/USD January 14 Significant MA’s as follows: 1.3351 and 1.3360 Vs 1.3832 or 481 pips from 1.3832 to 1.3551.

Last week: 1.3408 and 1.3360 to 1.3832. From 1.3832 to 1.3408 = 424 pips and a compression of 57 pips to overall ranges.

This week: 1.3448, 1.3360 Vs 1.3832 or 384 pips, a compression of 40 pips from last week and 97 pip in 3 weeks from 481.

January 9 to 16th: 1.3554 to 1.3575 or 21 pips

January 16 to 23rd: 1.3575 to 1.3671 or 96 pips.
January 23rd to 30th: 1.3671 to 1.3688 or 17 pips.

GBP/JPY

GBP/JPY. January 14 Significant MA’s as follows: 139.25 Vs 144.31 and 146.14 or 689 pips from 146.14 to 139.25.

Last week: 139.76, Vs 144.31 and 146.14 or 689 pips from 139.15 to 146.14 or 638 pips from 146.14 to 139.76.

Bottom average rose by 51 pips to compress ranges by exactly 51 pips.

This Week: 140.25, 142.66, 144.31 Vs 146.14 or 589 pips and an overall range compression of 100 pips.

January 9 to 16: 140.92 to 141.03 or 11 pips.
January 16 to 23rd: 141.03 to 141.95 or 92 pips.
January 23 to 30th: 141.95 to 143.39 or 144 pips.

The Week

GBP

Same story as last week, Overbought, GBP/USD, GBP/CHF, GBP/CAD and GBP/JPY. Nothing special to GBP/NZD however GBP/AUD watch 1.7852.

JPY

USD/JPY 104.66 close, watch below 104.31. All JPY cross pairs are deeply overbought.
USD/JPY Vs USD/CAD, VS USD/CHF Vs CAD/ZAR.

USD/CAD trades below at 1.2886, USD/CHF trades below at 0.8961, CAD/ZAR trades below at 11.9845.

USD/JPY Vs EM

USD/PLN Trades below 3.7521, USD/RON trades below 4.0473, USD/MYR Trades below 4.0487, USD/BRL trades above 5.3622, BRL/JPY trades below 19.4665.USD/HUF trades below 297.92

USD/JPY is vulnerable to a break lower at 104.31 to match counterparts. Current range 103.25 vs 106.00. USD/JPY currently sits at perfect neutral for the week. Next big point above 104.92.
From last week. Japanese Call Rates 0.988 Vs Deposit rate 0.900.

AUD

AUD/USD sits at perfect neutral while AUD/JPY, AUD/CHF are overbought and deeply oversold AUD/CAD. Lowest pair AUD/USD neutral Vs highest AUD/CAD neutral. AUD/JPY and AUD/CHF must rightsize to AUD/USD and AUD/CAD.

AUD/USD Breaks 0.7535 and AUD/CAD 0.9705 then AUD/JPY breaks its 5 year average at 79.72 to head lower and AUD/CHF follows.

EUR/CAD close at 1.5503 sits exactly on big break 1.5503. Last week, EUR/CAD sat 8 pips above vital break and traded 100 ish pips lower.

GBP/AUD 1.7852 and trades above while EUR/AUD trades below 1.5979, big divergence.

NZD

NZD/JPY and NZD/CHF sits deep overbought while NZD/USD and NZD/CAD retain fairly neutral positions. Same story as AUD.

Month End Vs Maintenance Periods

Month end 30 days vs Maintenance Periods 35 days. Traders talk about Month end. Central Banks meetings occur every 35 days. Current Central bank meetings represent the last days of 35. Rare day to see 30 trader day coincide to central bank 35.

Brian Twomey

From 21 currency pairs posted, AUD/USD achieved perfection at 0.7637, AUD/CHF and NZD/CAD closed within 5 and 6 pips to forecast while AUD/JPY and GBP/AUD were off by 13 and 14 pips.

EUR/NZD was next off 19 pips followed by EUR/CHF at 21, GBP/NZD 21 and USD/JPY off by 22 pips. AUD was the best forecast category while GBP was worst of 5 categories to include: EUR, GBP, AUD, NZD, USD. Both GBP/JPY and GBP/USD off by 52 and 62 pips.

The list as posted Friday at 3:00 AM

EUR/USD 1.2099, actual 1.2132, off 33 pips

EUR/CHF 1.0783, actual 1.0804, off 21 pips

EUR/JPY 126.21, actual 127.04, off 83 pips

EUR/CAD 1.5533, actual 1.5503, off 30 pips

EUR/NZD 1.6872, actual 1.6891, off 19 pips

EUR/AUD 1.5838, actual 1.5873, off 35 pips

GBP

GBP/USD 13636. actual 1.3688, off 52 pips

GBP/JPY 142.67, actual 143.29, off 62 pips

GBP/CHF 1.2129, actual 1.2194, off 65 pips

GBP/NZD 1.9034, actual 1.9055, off 21 pips

GBP/AUD 1.7892, actual 1.7905, off 13 pips

GBP/CAD doesn’t matter, and short at Sunday open. Result: doesn’t matter and short at the Sunday open.

AUD

AUD/USD 0.7637, Actual 0.7637

AUD/JPY 79.82, actual 79.96, off 14 pips

AUD/CHF 0.6803, actual 0.6808, off 5 pips

AUD/CAD 0.9801, actual 0.9766, off 35 pips

NZD

NZD/USD 0.7146, actual 0.7176, off 30 pips

NZD/JPY 74.70, actual 75.15, off 35 pips

NZD/CHF 0.6346, actual 0.6298, off 52 pips

NZD/CAD 0.9172, actual 0.9178

USD/CAD 1.2842, actual 1.2729, off 113 pips

USD/JPY 104.44, actual 104.66, off 22 pips

Forecasts are improving by the week. A perfect week will achieve

Brian Twomey

Government, for the Elites, By the Elites and serves Elitist people. America is in trouble as the Democrat monstrosity builds its destructive umbrella over America and closes day by day on the American people. May God bless America.

Brian Twomey

EUR/USD 2 main points today: 1.2041 and the vital break for much lower at current 1.2033. EUR/USD is not only close to significant levels but its opposite USD/JPY finally aligned yesterday to break above 104.27 and traded highs to 104.65 or 38 pips.

EUR/USD more perfect opposite CAD/ZAR trades current 11.81 and 17 pips below its vital break at 11.99. CAD/ZAR’s break at 11.99 would assure a lower EUR and a break to 1.2033.

Close Prices Today

EUR/USD 1.2099. Good call here.
EUR/JPY here’s the problem pair in the EUR universe due to break at 128.32 then below 125.46, 124.19 and 123.98. Next week’s weekly average bottom line will report in the vicinity of 124.19

EUR/CHF 1.0783, Do or die 1.0779
EUR/JPY close 126.21
EUR/CAD 1.5533

EUR/NZD 1.6872
EUR/AUD Best call last week, off 8 pips to the close. Today 1.5838

GBP/USD 1.3636

GBP/JPY Next problem pair in deep overbought. Close 142.67
GBP/CHF. 1.2129
GBP/CAD doesn’t matter, short Sunday on the open as was the call last week for quick 50 ish pips

GBP/NZD 1.9034
GBP/AUD 1.7892 and must remain above vital 1.7335 or far lower next week.

AUD/USD 0.7637

AUD/JPY 79.82 and 5 year average 79.72
AUD/CHF. 0.6803
AUD/CAD 0.9801

NZD/USD 0.7146

NZD/JPY 74.70 and 5 year average 74.59
NZD/CHF 0.6346
NZD/CAD 0.9172

USD/CAD Do or Die at vital 1.2887. Close 1.2842

USD/JPY remains above 104.27. Close 104.44

Brian Twomey

The EUR/USD day trade range was 1.2080 to 1.2141 or 61 pips and traded between highs from 1.2127 to 1.2142. We are at the highs of the day and 45 minutes until ECB then trading for the day is finished.

The focus now is on shorts and 1.2127 becomes the vital break to target remaining levels at 1.2119, 1.2112 and 1.2104. The closer time comes to ECB at 10:00 then exit with profits and walk away for the day.

Information was missing purposely over last days but profits today were + 44 pips then reverse longs to shorts for a few extra pips. Because ranges rarely break, trades are allowed for longs and shorts during 7 1/2 trade period.

The relationship from currency prices to economic announcements decoupled drastically and this was done purposely upon the new interest rate revamp by central banks.

GDP 4% expected. Percent % is the key. An economic announcement must align to the currency or any market price to trade correctly so a conversion is necessary.

4% is actually 0.0400 as a decimal, 1/ 25th as a fraction. Added and subtracted 400 pips to the currency price = 1.2497 and 1.1697. Well this is impossible.

The new interest rate system ensured economic announcements would remain in range and a few pips higher or lower upon releases not aligned to consensus. Far better moves were seen in the old days of economic announcements than is traded today.

Explains why economic announcements are just part of the daily range trade and are fairly meaningless.

Brian Twomey

From yesterday at 12:30 Fed to the China open at 8:30, here’s EUR/USD lineup.
Most Vital exchange rates: 1.2057, 1.2063, 1.2069 Vs Above 1.2113, 1.2121, 1.2128, 1.2136, 1.2143, 1.2151, 1.2159 and 1.2167.

Bottom. 1.2046
Upper target 1.2167
Continuation fail 1.2136

Bottom. 1.2046 achieves by 1.2054, 1.2063 and 1.2069.

Big 4 most vital: 1.2057 and 1.2069 Vs 1.2136 and 1.2167.

Actual trade range for 8 hours: 1.2083 to 1.2128 or 45 pips. EUR/USD traded its best trade for 31 pips from 1.2097 to 1.2128 at Fed time then EUR/USD died. A trade didn’t exist for 8 hours because EUR/USD existed in mid range.

A trade didn’t exist for Fed time because EUR/USD existed in mid range. Impossible to trade a price at mid range.

A trap exists at 12;30 Fed to factor trades because FED interest rates are released at 4;15 P.M. daily. A new trade must factor from 4:15 to the 8:30 China open or to factor a trade for 24 hours. What may or may not change is the range, vital support and resistance points and the minor trade levels in between.

Day to day interest rates however rarely change by much from day to day close prices. You’ll see maybe 1 or 2 points per maturity. Its the same as saying no change to prices.
The central banks now report 25 and 75th percentile trade ranges for overnight rates for Eonia, Fed Funds, Japanese Call rates. Then interest rates trade right back to the close price where they began.

But interest rate volumes trade miles higher than exchange rate volumes.

An interest rate factors to any day trade in any currency on the planet, any stock index, commodity and any market price. As long as an interest rate factors to the trade then all information is known in advance to the trade. The trader job then is click, click.

2 trades at the same time for today. Long GBP/USD 1.3606 to target 1.3617 then 1.3631 and short USD/CAD at 1.2898 to target 1.2857.

EUR/USD Trade

Exchange Rates: Below 1.2036, 1.2043, 1.2051, 1.2058 and 1.2066.
Above 1.2104, 1.2112, 1.2119, 1.2127, 1.2134, 1.2142, 1.2150, and 1.2158.

Bottom. 1.2036 achieves by 1.2043, 1.2051 and 1.2066.

Upper target 1.2158
Continuation fail 1.2127

Big 4 Most vital: 1.2046, 1.2058 Vs 1.2127 and 1.2158.

Recall the weekly trade vital points for EUR/USD at 1.2116. Today its 1.2114.

The day trade now interferes with the weekly important MA points.

Trade Point. Highly doubtful EUR/USD leaves today’s range as this rarely happens.

However if EUR/USD trades above 1.2158 or below 1.2036 then free money exists to longs and shorts as EUR/USD is mandatory to trade back to prescribed ranges.
No mention to GDP or the slew of data today. Nobody cares nor does the EUR/USD price path.

Also notice, no stops, charts, graphs and thankfully no Fibonacci numbers. The worst number to factor trades on the planet is Fibonacci numbers.

Brian Twomey

As written this morning at 3:00 A.M, here’s the daily trade for EUR/USD and good until 10:00 A.M. based on exact interest rates to exchange rates.

Step 1
Exchange Rates: Most Important 1.2112, 1.2118 and 1.2125 Vs 1.2169, 1.2177, 1.2184, 1.2192, 1.2199, 1.2207, 1.2215 and 1.2223

Bottom. 1.2101 achieves by 1.2131,1.2123 and 1.2116

Upper target 1.2223

Continuation fail 1.2192

Result: At 9:30 AM and in the last 1/2 hour to the day trade, EUR/USD traded to exactly 1.2101 Bottom then rose to 1.2116. Notice the bounce point to hit at 1.2116.
EUR/USD dropped from 1.2165 and note just prior to 1.2169.

The trade from 1.2165 to 1.2101 result +64 pips. Then automatic long from 1.2101 to 1.2116 for +16. And total +80 pips.

Step 2

Take 80 pips and walk away for the day to produce more profits for tomorrow. Note this is 1 day trade of 8 total traded twice daily. Walk because the bottom hit at 1.2101 at 9:30 A.M. was 30 minutes before ECB.

The ECB had 2 choices: take EUR/USD higher or lower. ECB decided on EUR/USD lower to 1.2058 and this happened at the 9 A.M Candle on the hourly chart. The hourly candle runs from 9:00 A.M. to 10:00 A.M.

The Lesson

Vital to know which exchange rates trade in relation to the times of the day. If EUR/USD bottom at 1.2101 hit at 8:00, 7:00 or even 6:00 A.M then EUR/USD would traded much higher than 1.2116.

Step 3

Only a few pips will change at FED time today. Matter of fact, not much will change in a 24 hour trade period. Personally, we don’t trade Central Bank meetings because nothing exists to trade.

Result: EUR/USD traded barely 30 pips for the FED.

The Trade

The Fed at 12:30 dictated the EUR/USD trade.

Exchange Rates: Most Important : 1.2057, 1.2063, 1.2069 Vs Above 1.2113, 1.2121, 1.2128, 1.2136, 1.2143, 1.2151, 1.2159 and 1.2167.

Bottom. 1.2046, 1.2063 and 1.2069.

Upper target 1.2167

Continuation fail 1.2136.

Points Most Vital: 1.2057 and 1.2069 Vs 1.2136 and 1.2167. Points here represent EUR/USD Vs USD/EUR. The whole day trade represents EUR/USD Vs USD/EUR.

Result

EUR/USD traded between 1.2097 to 1.2128 for 31 pips. The 31 pips traded middle range from the new day trade at 1.2069 to 1.2128. A trade didn’t exist.

The Lesson

Once the FED sets exchange rates at 12;30 then the next major change for exchange rates is the China open at 8:30 P.M. EST. EUR/USD sits for 8 hours on the new day trade and on the same exchange rates.

Traders won’t use their full trade options nor will EUR/USD trade the full exchange rate list at 12:30 with 8 hours to go.

We begin again at 8:30 P.M. to trade Asia then comes the new day trade from 1:30 A.M. to 10:00 A.M. We don’t ever trade after 10 A.M. because all the central banks are in the market.

Most important overall, the exchange rate price path doesn’t care about Powell, central banks and 99% of all the outside events to possibly move the exchange rate. The price path for the day trade only cares about its ranges, levels and targets. Same for the weekly trade.

Brian Twomey

Previous ECB interest rates and the EUR traded between the ECB’s Deposit rate and the Refinance rate. Spreads were wide at 75 and 125 and 150 basis points. The spread was wide enough for the EUR to trade far and wide on any given day, 2 and 300 pip days way back when was fairly common.

Then the ECB decided EUR daily ranges were far to wide so they prevented movements by a complete overhaul to the ECB’s interest rate structure.

Today the Deposit rate is 0.50 and 0.00 to the Main Refinance rate or 50 basis points. The 50 basis points is down from 0.60 to 0.00 in 2016 and 65 basis points in 2015 after the ECB went negative interest rates.

The new 50 basis point range and the smallest in ECB history is enough to stabilize the EUR to ensure it won’t ever trade as the instrument it once was but would trade in much smaller ranges. But 50 basis points was not enough to destroy EUR daily ranges as the ECB re factored Eonia as the ECB’s overnight rate then introduced the STR or Short Term Rate to send EUR daily ranges to its funeral.

Today’s Eonia trades 0.524 and 24 basis points above the 0.50 Deposit rate. EUR/USD shorts must break 0.50 on the deposit rate. Not likely anytime soon. For the past week Eonia traded from 0.524 to 0.520 or 4 basis points. 2 weeks ago, Eonia traded from 0.519 to 0.523 or 4 basis points. Not much going on to the main EUR driver of prices.

Eonia represents the top interest rate to the interest rate corridor however Eonia will trade its last transaction later in 2021.

The Short Term Rate was introduced in 2018/ 2019 and will substitute for Eonia.
Today’s Short Term Rate was offered at 0.442 and trades 58 points below the 0.50 Deposit rate and 82 points below Eonia. Now we have a floor and ceiling from 0.442 to 0.50 and 0.50 to 0524.

The STR range yesterday traded from 0.420 to 0.470 or 18 points on the topside and 22 points on the bottom.

Next comes Euribor rates offered as complements to Eonia and STR.

Euribor from 1 week to 1 year rates: 0.429, 0.446, 0.457, 0.479 and 0.507. All rates pretty much now tracking the STR rate yet the predominant EUR driver is Eonia. The closest match to Fed yields is the 5 year yield at 0.42 then the 7 year yield at 0.73 or a range from 0.42 to 0.73.

To align all interest rates then as follows: 0.429, 0.442 STR, 0.446, 0.457, 0.479, 0.50 Deposit Rate, 0.507 Euribor and 0.524 Eonia.

ECB interest rates are not necessarily specific to apply for EUR daily trades. Just as good are Fed and New Zealand interest rates. And this applies to all currency pairs for day trades.

EUR/USD tops, bottoms and traded levels in between must correspond to an interest rate. Its the way currency prices began trading at the 1972 free float and no other way exists to trade the daily trade.

All ECB rates trade above Fed rates.

Short Term Rate STR since Introduction

Eonia 1 Month

Graph last month

Eonia 1 Year

1 Month EUR/USD Vs USD/EUR

   EUR/USD Trade today, good until 10:00 AM EST. Only a few pips will change at FED time today. Matter of fact, not much will change in a 24 hour trade period. Personally, we don't trade Central bank meetings because nothing exists to trade.  EUR/USD and the exact complement to interest rates.