Currency Pair Correlations and EUR/USD Averages

As highlighted yesterday to EUR/NZD correlations to EUR/USD at +42% and +10% to NZD/USD, GBP/NZD begins the year in a far worse situation than EUR/NZD..

GBP/NZD correlations to GBP/USD runs minus 25% and minus 62% to NZD/USD. To re correlate correctly to either GBP/USD or NZD/USD, GBP/NZD must move significantly. Normally a break of a significant average would force GBP/NZD to re marry correctly to correlations.

GBP/NZD’s place in currency markets is the number 1 mover to wide, wide ranges followed by GBP/JPY while number 3 is not to be found. GBP/AUD, GBP/CHF and EUR/NZD were next as big movers but all were reduced to nothing in the new modern day currency markets.

GBP/AUD remains a problem to the GBP universe at – 17% correlations to GBP/USD and negative 32% to NZD/USD. GBPCAD is holding at +38% to GBP/USD.
Positive, negative and problem correlations are found within moving averages. Here’s GBP/AUD averages from 5 to 253 day

5 day = 1.8577, 10 day = 1.8573, 20 day = 1.8560, 50 day = 1.8554, 100 day = 1.8536, 200 day =1.8610 and 1.8511 at the 253 day average. GBP/AUD is not a trade able currency.

The AUD/USD universe is correct except for AUD/NZD running at -23% correlations to AUD/USD and +47 to AUD/CAD. AUD/NZD is the opposite pair to AUD/CAD.
NZD/USD also runs correct at +90% to the NZD universe.

EUR/GBP is a further conundrum to the EUR cross pair line up as correlations run +86% to EUR/USD and +73% to GBP/USD. EUR/GBP was never worth a trade effort particularly in today’s currency markets.

USD/JPY vs USD/CAD is correct at +93% and -96% to EUR/USD but not correct to USD/CHF at +23%.
EUR?USD 2005, 2014, last week and today.
EUR/USD pre 2016 interest rate changes is highlighted below by averages pre and post 2016 and from the period September to December.

5 day = 1.1851
10 day = 1.1911
20 = 1.1876
50 = 1.1797

100 = 1.1917
200 = 1.2058
253 = 1.2195
Averages spread 398 pips.


5 day = 1.0460
10 day = 1.0439
20 = 1.0480
50 = 1.0591

100 = 1.0836
200 = 1.1002
253 = 1.1064
Average spread 625 pips.

Last week

5 day = 1.1299
10 day = 1.1303
20 day = 1.1296
50 day = 1.1338

100 day = 1.1489
200 day = 1.1672
253 day = 1.1763
Average spread 467.


5 day = 1.1314
10 day = 1.1306
20 day = 1.1303
50 day = 1.1311

100 day = 1.1464
200 day = 1.1645..
253 day = 1.1748

Average spread 445 pips and a 22 pip drop from last week. The difference today to average spreads is pre 2016 employed a far different set of interest rates as noted by much greater daily and weekly movements from today to 400 pips. The 400 pips will eventually contract for 2022 for an additional slowdown to daily and weekly moves. Where containment is seen is the 5 to 20 and 50 day average spreads as prices enter 50 and 100 pip spreads.

Brian Twomey


Currency markets this week are driven by middle currencies GBP/USD, AUD/USD and associated cross pairs while top and bottom currency pairs EUR/USD and NZD/USD remained trapped in tiny ranges.

GBP/USD began the week above vital 1.3357 followed by Sunday’s reported levels at 1.3357, 1.3441 and 1.3459. While GBP/USD appears to have broken 1.3459 to trade higher, the average at 1.3459 traveled higher as GBP/USD rose. GBP/USD this week was caught in a trap however higher price vs higher averages warns to eventual drop as GBP/USD must correct lower.

The GBP/USD line up remains as 1.3165, 1.3357, 1.3442 and 1.3484. The level at 1.3459 traveled 25 pips higher and GBP/USD eventually broke to trade 1.3503. Shorts remain as current GBP/USD targets a break at 1.3442 to then 1.3407 then 1.3368.
GBP/USD main price driver is 1.3357 as GBP/USD is far to low in the vicinity of 1.3357. GBP/USD this week traded 115 pips.

GBP/JPY against an +85% correlation to GBP/USD naturally traveled 229 pips higher. GBP/JPY at 155.00’s sits massive overbought and just below a multi year range top; at 157.00’s. GBP/JPY is the lead driver to GBP/USD lower. GBP/JPY overall began the current upmove from 148.00 and traded 700 pips higher. Miles of downside exist yet to trade.


AUD/USD traded as GBP/USD. AS AUD/USD traded higher then averages at 0.7255 and 0.7260 rose to eventually stop AUD/USD’s climb. Vital breaks for higher are now located at 0.7260, 0.7268 and 0.7307. AUD/USD targets mid to lower 0.7100’s. The main driver to a lower AUD/USD is deeply overbought AUD/JPY.

USD/JPY short at 114.72 traded to 115.21, off 40 pips from entry and a Christmas gift to free money. USD/JPY began the week overbought and offered an extra 40 pips to downside profits. Longer term, USD/JPY is overbought from 101.00, 109.00, 110.00’s, 112.00 and 113.00’s. USD/JPY is overbought across the board.

DXY traded not only weekly lows to 95.77 but a break at 95.25 then USD travels lower on a deep slide and assists to USD/JPY’s 110 target.

EUR/USD and Cross Pairs

EUR/USD’s range and neutrality problem is located in a deeply oversold EUR/CHF, overbought EUR/JPY and dead ranges to EUR/CAD, EUR/AUD and EUR/NZD.
EUR/NZD contains a correlation dilemma to EUR/USD at +42% and +10% to NZD/USD. EUR/NZD higher is prevented by NZD/USD at 0.6841, 0.6854 and 0.6890.

EUR/USD is free to travel higher to target now 1.1418 and 1.1435 however the correlations to EUR/NZD prevents cross pair assistance particularly EUR/NZD and EUR/JPY.

EUR/NZD’s buy drop strategy targets 1.6520 then 1.6637 and just head of big break lines at 1.6760 and 1.6772.

Despite an 84% correlation to EUR/USD, EUR/CAD to move higher must break 1.4531, 1.4557, 1.4693, 1.4722 then 1.4800’s. EUR/CAD offers no assistance to a higher EUR/USD.

EUR/AUD is trapped between 1.5475 to 1.5733, 1.5749 and 1.5787. The positive to EUR/AUD and long drop strategy is correlations to EUR/USD at +81% and +67% to AUD/USD. Long term, nothing exciting exists to EUR/AUD except to range trade.
The true insight to EUR/AUD is richter scale overbought to AUD/EUR and overbought is enough to assist to lower AUD/USD.

USD/JPY Cross Pairs and Correlations

JPY cross pairs remain deeply overbought to include CHF/JPY. For CHF/JPY is massive overbought from every average dating to 1999, overbought to 5, 10 and 14 year averages, overbought to shorter averages from 5 to 253 day.

CHF/JPY correlates to USD/JPY at 97% and is the best assist to a lower USD/JPY. Great long term short.

USD/JPY negatively correlates to EUR/JPY -69%, AUD/JPY +17%, NZD/JPY -19% and +43% to CAD/JPY.

Next week’s trade and lazer focus is GBP as the best category to offer best trades and most profits.

Brian Twomey

Monthly Average Yields: 2, 5, 10, 20 and 30

Yields as 2, 5, 10 and 30 year monthly averages trade below 5 year month averages as follows: 1.3025, 1.5744, 1.9150 and the 30 year at 2.4335.

The 20 year yield from current 1.9350 trades below the 30 year at 1.904. While the shape of the yield curve correctly points straight up from 2 to the 10 year, the long end contains problems at the 30 year and 20 against a downslope curve. The short end of a yield curve from 2 to 10 year is reserved for trading interest rates, money market funds, stocks indices, currencies and market instruments, the long end is a commentary to overall economics and health of an economy.

2 Year Yield

The 2 year yield from current 0.748 trades between the 2 and 3 year monthly averages from 0.3376 to 0.8871 or 54 points and a mid point at 0.6123. Above 0.8871 targets the range from 0.8871 to 1.2865, a 39 point range and mid point at 1.0868. Below 0.8871 targets a 10 point range from 0.3376 to 0.2357.

Monthly averages for the 2 year are uniform and ends at the 1.3025 5 year average. Targets are located from 0.2567, 0.3778, 0.3785 and 0.7194.

Fed Funds Rate vs 2 Year Yield

Monthly averages for the Fed Funds rate trades at the 1 year monthly at 0.0816 to 0.2291 then 0.8725 at the 3 year monthly average. Fed Funds monthly averages from the 6 year to the 15 year trade from 0.9743 highs to 0.54 lows and much in between. Neither the 2 year yield nor Fed funds are oversold nor overbought as both exist in trade ranges.

5 Year Yield

The 5 year yield from current 1.245 trades a 40 point range between the 3 and 4 year monthly averages from 1.0870 to 1.4927 and a mid point at 1.2898. Below 1.0870 targets 0.8146 and above 1.4927 targets an 8 point range from 1.4927 to the 5 year monthly average at 1.5744.

10 Year Yield

The 10 year yield trades a 35 point range between the 3 and 4 year monthly averages from 1.4564 to 1.8095. As written in September, the 10 year at 1.57 traded a 38 point range from 1.2290 to 1.6146.

The 5 year monthly average in September was located at 1.9321 and 1.9150 today. While the topside at the 5 year dropped, bottom averages rose. In October from 1.51, a break at 1.6146 targeted a 25 point range from 1.6146 to 1.8696. Lower targeted 1.6146 to 1.2290. Topside averages dropped significantly in 2 months while bottom side averages rose to lead to an eventual showdown.

Below 1.4564, the 10 year range trades a 5 point parameter from 1.4564 to 1.4045 then a significant drop to the next average at 1.1545. Above 1.4564 then the range becomes 1.4564 to 1.8095 and a mid point at 1.6329.

10 vs 2 Spread, Fed Funds and Correlations

From the 10 year mid point at 1.6329 to the 2 year from 0.6123 then the 10 and 2 spreads 1.1226 and 0.89 from averages 1.4564 and 0.3376.

The 10 year vs 2 at the 2 year monthly average correlates +48% and +86% at the 3 year average.
Fed Funds at the 1 year monthly averages vs the 2 year correlates +0.01%, the 2 year average at +86 and +97% for the 3 year.

The corresponding 10 year vs Fed Fund at the 1 year average correlates -71%, +39 at the 2 year and +81% at the 3 year average.

20 Year Yield

Best monthly averages are located from 1.7080 to 1.9451.

30 Year Yield and 10 Year Correlations

From current 1.905, the 30 year yield trades from the 2 year monthly average at 1.7987 to the 1 year average at 2.0261 then the 3 year at 2.0581 and 2.3126.

While the 30 and 10 year monthly averages correlate at the 1, 2 and 3 year at +83%, +96% and +98%, the 30 year should trade a minimum of 2.05 and a range from 2.05 to 2.52 at the top end. Problem to 2.52 along the price path is the 4 year at 2.3126 and 5 year at 2.4335.

Fed Funds vs the 30 year correlates -73% at the 1 year, +30% at the 2 year and +77% at the 3 year. While the 30 year offers no assistance to Fed Funds insights, the 30 also offers no help to trade financial instruments.

Brian Twomey

ECU European Currency Unit

What was the european currency unit?
The european currency unit, ECU for short, was an artificial “basket” currency that was used by the member states of the European Union (EU) as their internal accounting unit. The ECU was conceived on 13th March 1979 by the European Economic Community (EEC), the predecessor of the European Union, as a unit of account for the currency area called the European Monetary System (EMS). The ECU was also the precursor of the new single European currency, the euro, which was introduced on January 1, 1999.
The acronym ECU is considered a word and in French is the name of ancient French coin. The ISO-4217 symbol for the ECU was “XEU”.
How was the ECU linked to the European Monetary System?
The EMS was a limited-flexible exchange rate system that defined bands in which the bilateral exchange rates of the member countries could fluctuate. The bands of fluctuation were characterized by a set of adjustable bilateral central parities and margins that defined the bandwidth of permissible fluctuations. This set of parities was called a parity grid as it defined parities for all combinations of the ECU constituent currencies. The borders of the fluctuation bands were described by the upper intervention point and lower intervention point. Typically, the bandwidths were 2.25% to each side, with a wider margin for the Italian Lira. After a currency crisis in 1993, the bands were widened to 15% on each side, but in practice the fluctuations were kept within a narrow band. When a market exchange rate reached either of these intervention points, the central banks were compelled to support these rates indefinitely through open market operations (buying of weakened currency or selling of a strengthened currency). Some countries (notably Britain) initially did not participate in the exchange rate mechanism of the EMS. Britain participated actively in the EMS only for a short period.
What is the value of an ECU?
When the euro was introduced in January 1999, it replaced the ECU at par (that is, at a 1:1 ratio).
The tables on the right shows the composition of the ECU basket as it evolved over time through the expansion of the European Union. Note that the compostion values in the table below are fixed, while the weights fluctuate due to changes in the bilateral exchange rates.
How can one calculate the value of an ECU?
To calculate the value of the ECU (XEU) with respect to another currency (say, USD), divide each of the twelve amounts of national currency in the ECU basket (see table above) by the corresponding exchange rates of that country vis-à-vis the target currency (DEM/USD, FRF/USD, GBP/USD, etc.). Then add these twelve numbers together to obtain the USD/XEU exchange rate.
The tables below show the composition of the ECU basket at different times during the existence of the ECU.
13-Mar-1979 through 16-Sep-1984
ISOCurrencyValueWeight (%)
 BEF  Belgian Francs  3.80  9.64 
 DEM  German Marks  0.828  32.98 
 DKK  Danish Krones  0.217  3.06 
 FRF  French Francs  1.15  19.83 
 GBP  British Pounds  0.0885  13.34 
 IEP  Irish Punts  0.00759  1.15 
 ITL  Italian Lira  109  9.49 
 LUF  Luxembourg Francs  (*)  (*) 
 NLG  Dutch Guilders  0.286  10.51 
Technical Notes: The Belgian and Luxembourg francs were in a currency union. Thus, the ecu basket values are combined and shown only for Belgium. Weights are evaluated at central parities on March 13, 1979.
17-Sep-1984 through 21-Sep-1989
ISOCurrencyValueWeight (%)
 BEF  Belgian Francs  3.85  8.57 
 DEM  German Marks  0.719  32.08 
 DKK  Danish Krones  0.219  2.69 
 FRF  French Francs  1.31  19.06 
 GBP  British Pounds  0.0878  14.98 
 GRD  Greek Drachmas  1.15  1.31 
 IEP  Irish Punts  0.00871  1.20 
 ITL  Italian Lira  140  9.98 
 LUF  Luxembourg Francs  (*)  (*) 
 NLG  Dutch Guilders  0.256  10.13 
Technical Notes: The Belgian and Luxembourg francs were in a currency union. Thus, the ecu basket values are combined and shown only for Belgium. Weights are evaluated at central parities on September 17, 1984.
21-Sep-1989 through 31-Dec-1999
ISOCurrencyValueWeight (%)
 BEF  Belgian Francs  3.301  8.183 
 DEM  German Marks  0.6242  31.915 
 DKK  Danish Krones  0.1976  2.653 
 ESP  Spanish Peseta  6.885  4.138 
 FRF  French Francs  1.332  20.306 
 GBP  British Pounds  0.08784  12.452 
 GRD  Greek Drachmas  1.44  0.437 
 IEP  Irish Punts  0.008552  1.086 
 ITL  Italian Lira  151.8  7.840 
 LUF  Luxembourg Francs  0.13  0.322 
 NLG  Dutch Guilders  0.2198  9.87 
 PTE  Portugese Escudos  1.393  0.695 
Technical Notes: During the period May 3, 1998 through December 31, 1998, the rates of the 9 currencies that are part of the ECU basket as well as euro-11 member currencies were irrevocably fixed. Weights are evaluated at the prevailing exchange rates on December 31, 1998.

Brian Twomey


Since NZD/USD broke below its 5 year average at 0.6843 in November, lows achieved 0.6702 or 141 pips then rose 138 pips to 0.6840 highs. NZD/USD at current 0.6809 is right back where it began in November.

NZD/USD higher must break 0.6841 , 0.6856 and 0.6888. The target below is located at 0.6503 and the same reported target written in November. Problem with the 0.6503 target is higher averages above 0.6841 target 0.6769 and 0.6742. NZD/USD has every ability to achieve 0.6503 but higher averages must follow and currently averages are rising and the same situation for EUR/USD and AUD/USD.

Rather than oversold or overbought, NZD/USD just exists doing nothing. Most vital however as NZD/USD represents the bottom currency and signal pair, a break above 0.6841, 0.6856 and 0.6888 then the target at 0.6503 is nullified as higher targets become 0.6911, 0.6979 and 0.7053.

As bottom currency and signal pair, NZD/USD break above 0.6841, 0.6856 and 0.6888 cancels a lower EUR/USD and AUD/USD as the rear guard forces EUR/USD and AUD/USD higher.

NZD/CHF and correlations to NZD/USD is a further prevention for an NZD/USD drop as NZD/CHF at current 0.6256 is oversold and any further drops then NZD/CHF achieves the richter scale to oversold.


EUR/USD’s target at current 1.1049 is derived from its 5 year average now at 1.1508 and rising. Longer dated averages in the 1.1500’s and rising are deeply oversod and prevents a significant EUR/USD drop. EUR/USD big break is located at 1.1451 and an average neither rising or falling over many weeks. Above 1.1451, contends with 1.1.508, 11568 and 1.1573.

EUR/USD Seasonals

EUR/USD not only enters its seasonal downtrend, January is a huge EUR month. Dating to 1995, EUR/USD records 15 down months for January and 8 up months. For 2019 ended the month with a Doji candle.

XEU and ECU Exchange Rates

A quick aside to prior 1998 exchange rates. USD/DEM as the German currency ruled Europe as the EUR/USD performs its tasks today. USD/DEM was separated from the European XEU basket then factored using ECU exchange rates to transfer the proper exchange rate number from USD/DEM to EUR/USD.

Any students of the markets remaining today and dying to see XEU and ECU calculations and how it was all factored, see FXstreet and my blog for deep details as I performed and showed the necessary calculations. The same principle holds from 2012 when Greece threatened to leave the European Union and the Greek Drachma was repriced as EUR/GRD at 312.00.

EUR/USD and Ranges

For interested, on my blog is a range comparison from MA’s 5 to 253 days then from 5, 10 and 14 year averages. Compared with averages from 2005 to 2021 are targets for every average. Since 2005, EUR/USD ranges dropped by slightly more than 1/2.


AUD/USD’s big break is located at 0.7255, 0.7259, 0.7304 at the 5 year average and 0.7368. The target at current 0.6896 for the most part achieved target at low 0.6900;s then AUD/USD rose to current 0.7200’s. Similar to NZD/USD, AUD/USD dropped 400 pips then rose 300 .

Similar to EUR/USD, longer dated averages are massively oversold to force AUD/USD higher and a long only strategy much like EUR/USD and NZD/USD.
To achieve again the target at 0.6896 will take time as 0.7255 won’t allow 0.6896 to trade without becoming richter scale oversold.

Brian Twomey

EUR/USD 2005 Vs 2021

Below is EUR/USD 5 to 253 day averages during the period 2005-09-05 to 2005-12-26. EUR/USD on December 26 was 1.1859.

— Day Averages —
 # Trading DaysMean AvgStd DevZ-ScoreZ-Target
5 Day31.18510.00210.38101.1872
10 Day61.19110.0063-0.82541.1848
20 Day151.18760.0097-0.17531.1779
50 Day351.17970.01000.62001.1897
100 Day701.19170.0150-0.38671.1767
200 Day1421.20580.0207-0.96141.1851
253 Day1801.21950.0343-0.97961.1852

Vs EUR/USD today in the period September to December 2021. EUR/USD today trades from the close at 1.1315.

— Day Averages —
 # Trading DaysMean AvgStd DevZ-ScoreZ-Target
5 Day51.12990.00151.06671.1314
10 Day91.13030.00230.52171.1326
20 Day151.12960.00230.82611.1319
50 Day361.13380.0095-0.24211.1243
100 Day731.14890.0171-1.01751.1318
200 Day1451.16720.0236-1.51271.1436
253 Day1821.17630.0279-1.60571.1484

Notice 5, 10, 20 day averages died today Vs 2005. All averages died 2005 vs today.

5, 10 and 14 Year averages in 2005

Year Average –
# Years# Trading DaysMean AvgStd DevZ-ScoreZ-TargetStd ErrErr Z-ScoreErr Z-Target

Vs 5, 10 and 14 Year Averages today 2021

Year Average –
# Years# Trading DaysMean AvgStd DevZ-ScoreZ-TargetStd ErrErr Z-ScoreErr Z-Target

FX Weekly: EUR/USD, GBP, CHF, Correlations

Most informed commentary to overall currency markets is cross pairs are now aligned to anchor pairs as AUD/CHF for example is now aligned to AUD/USD by Correlations at +99%, NZD/USD to NZD/CHF +99%. GBP/USD to GBP/CHF +99%, and EUR/USD to EUR/CHF +99%.

USD/CAD is correct and a fairly permanent currency market condition Vs CAD/CHF at -98%. The rarely seen yet great shift to currency pairs is now complete by CHF switch and means the 2nd side of the exchange rate no longer drives, controls and correlates to opposite 2nd sided currencies within an exchange rate.

USD/JPY no longer moves and correlates to JPY cross pairs, USD/CAD no longer moves and correlates to GBP/CAD, USD/CHF no longer moves and correlates to AUD/CHF and 2nd sided CHF in the exchange rate.

EUR/USD, GBP/USD, NZD/USD and AUD/USD now correctly correlates to its own cross pairs within the respective universe. A powerful development as the universe now trades together as one unit and it means ranges expand to create more profit potential.

USD/JPY, USD/CAD and USD/CHF now trade on their own without cross pair assistance and are vulnerable to downside potential and diminished ranges. Beside DXY and trade above vital 95.52, USD currency pairs within the 28 pair universe now reduces to 3 currencies as follows: , GBP/NZD, CHF/JPY, GBP/AUD. CHF/JPY by +90% correlations belongs to USD/JPY while GBP/NZD and GBP/AUD negatively correlate -22% to GBP/USD.

USD was once the driving force to currency markets as USD/JPY, USD/CAD and USD/CHF correlated to 15 of 28 currency pairs.

USD/JPY begins the week overbought and oversold to USD/CHF and USD/CAD.

Last week’s long trade to target 114.25 and 114.32 traded to 114.50 highs and short target at 113.41 traded to 114.29 lows. Wednesday highs at 114.37 traded to 114.05 lows.
USD/JPY weekly trade in the past 6 weeks achieved +900 ish pips for 6 trades.

Lesson for Traders

All 6 USD/JPY trades achieved upside and downside targets. No requirement existed to watch screens, charts, use stops or concentrate on the latest market news. The market price is matched to the mathematical trade strategy but never a strategy matched to the price as this never works.

A traders final destination is click on Sunday and exit by Friday without regards to price movements. This allows a trader to live life outside markets. Clearly a hard concept to grasp as most traders watch screens all day and don’t know or trust the price.

USD/JPY this week targets 114.64 and 114.71 then shorts target 113.59.
USD/CHF driving price is located at 0.9337 and targets 0.9168 then 0.9253. Historically and from long term models, USD/CHF lives a constant oversold position year after year.

USD/CAD trades the same weekly story as vital levels are located at 1.2250, 1.2697 and 1.3032. JPY cross pairs for the week are overbought to include richter scale overbought CHF/JPY.


GBP/USD traded 1.3437 highs last week and prior to reported 1.3445 and 1.3464. Vital levels this week are located at 1.3160, 1.3357, 1.3441 and 1.3459.
Concentration this week are favored GBP pairs as GBP/USD, GBP/JPY and GBP/CHF.


Longer dated averages remain deeply oversold .and targets 1.1423, 1.1438 and 1.1442 and just ahead of vital break for higher at 1.1451. The downside target is now 1.1049 and 8 pips higher from last week as bottom averages are rising to explain EUR/USD’s neutrality at 1.1300’s. EUR/USD 1.1277 must break to sustain a downside move.


Same position holds as 95.52 to 97.16 and DXY tops at 98.00’s and 99.00’s.
Overall, currency markets this week are heading for range conditions without dramatic price moves.

Brian Twomey

DXY, EUR, GBP, USD/JPY, AUD, Cross Pairs

Currency prices as usual brought the market to the do or die brink. Bottom pair NZD/USD as the ultimate currency market signal pair trades just below vital 0.6841. A break targets the range from 0.6841 to 0.6890. Lower targets 0.6776 easily.

GBP/USD is hovering around vital 1.3357. As mentioned Sunday, ranges from 1.3357 are found next at 1.3351 to 1.3445 and 1.3156 to 1.3357. GBP/USD big break for higher is located at 1.3453, lower targets 1.3269 easily.

DXY last Wednesday traded to 96.95 and just below vital 97.16 and corrected to 95.84 lows and trades current at 96.08. The range is located from 95.25 to 97.16. The range held since November 15.

EUR/USD big break below to resume the downtrend is found at 1.1277 and aligns to today’s day trade lows at 1.1283 and 1.1276. A good weekly target is also located at 1.1277 where EUR/USD’s price normalizes.


USD/JPY target as written Sunday at 114.25 and 114.32 completed and traded to 114.36 highs. Weekly lows achieved 113.33. From 114.36, lows achieved 114.05. The trade runs roughly 100 ish pips. USD/JPY contains miles of downside.

USD/JPY Long Term

USD/JPY for the year traded from 102.00 lows to 115.00 highs or 1300 pips. Here’s today FX lesson. Fairly normal yet high ranges for any given year trades 1300 to 1500 pips. This concept was demonstrated by EUR/USD from 1998 to ? 2019 and written on my blog and fxstreet.

EUR/USD traded its maximum 1500 ish pips due to the ECB in 2014 and 2015 to go negative interest rates. USD/JPY from 2016 lows at 98 traded 1700 pips in 6 years or 283 pips per year.

USD/JPY’s 9 year currency cycle from 75.05 lows in 2012 achieved 5000 pips to 125.77 or 555 pips per year, a mid point at 100.41 and 1400 pips from current 114.00’s.

DXY maximum range top highs for the year are located at 98.00 and 99.00’s.

Will USD/JPY trade to 125 or 1100 pips from 114.00’s is answered by expectation to our career criminals, currency analysts and trade services to operate in full force in 20222 as they plot to abscond with every last nickel in your account. Currency brokers now hold the position as assistants and unscathed however all must answer to God in good time.

Further to 2022. Currency prices will trade to a severe slowdown. Today’s ranges will cut by 1/2. Brian Twomey however runs the Louis Vuitton of trade services as we know what’s coming and well prepared for any trading event.

Targets achieved in 2012’s high volatility markets is matched by targets achieved in 2021 under no volatility. All posted exclusively at fxstreet and my blog.

AUD/USD as the big winner over the past month rose from 0.6900’s or 400 pips to now face its test at 0.7253 then 0.7304. Fail to break targets 0.7170’s easily.

EUR/JPY achieved 129.32 as written Monday and a short only strategy begins. GBP/JPY achieved 153.00’s upon breaks at 151.25 and 151.96.

USD/CAD managed to break 1.2840 and 1.2853 to trade to 1.2816 lows and on the way to target 1.2738. USD/CAD’s day trade lows are located at 1.2805, 1.2789 and 1.2773.

EUR/AUD trades at the oversold richter scale lows at 1.5643 and heading higher. Watch EUR/CAD 1.4533. EUR/GBP is included to trade at ricjter scale oversold.

Overall, time for a USD correction higher and risk pairs as EUR/USD, GBP and AUD to travel lower.

Brian Twomey

Long Term Targets: USD/CAD, Correlations, CAD Cross Pairs

Currency cross rates as exchange rates are constructed by 2 currencies and generally from 2 opposite currencies such as EUR/USD and USD/ CAD to combine EUR/CAD. EUR is the risk side as EUR/USD while USD/CAD represents the USD side as opposite. Either EUR/USD or USD/CAD as anchor currency pairs are the main drivers to EUR/CAD prices.

The premiere indicator for price drivers are correlations because correlations provide mathematical proof to anchor pair drivers and Correlation answers many questions such as is EUR in control of its cross pairs, is a double trade located as EUR/USD and EUR/CAD or USD/CAD and EUR/CAD. Are currency markets trading in a risk on mode or favor USD as non risk.

Vitally important because markets trading as risk on mode by EUR/USD and EUR/CAD positive Correlations contain wider ranges and more profit potential than USD/CAD and EUR/CAD.

Correlations never disappear from markets and its impossible to leave currency pairs as a Correlational determination must always exist and found by moving averages. A Correlation is the hidden number from 1.0 to -1.0 and flows in and out of currency prices.

JPY cross pair correlations to USD/JPY relinquished control in favor of anchor pairs such as EUR/JPY to EUR/USD, AUD/JPY to AUD/USD. EUR/USD and AUD/USD are rightful owners to EUR/JPY and AUD/JPY so the universe of cross pairs are correctly trading as one unit.

USD/JPY as an insurgent currency commits a treasonous act to subvert EUR/JPY to its positive correlation side.

USD/CAD’s long held standing as positive Correlations to CAD cross pairs are now gone as Correlations shifted to EUR/USD and EUR/CAD +85%, AUD/USD and AUD/CAD +86%, GBP/USD and GBP/CAD +82%, NZD/USD and NZD/CAD +96%.

How strong is the shift. USD/CAD Vs GBP/CAD -58%, USD/CAD Vs EUR/CAD -64%, USD/CAD Vs AUD/CAD -66%, USD/CAD Vs NZD/CAD -90%. The Correlational shift is solid as a rock.

Currency markets are experiencing massive changes by Correlational shifts as cross pairs retain its rightful position to original anchor pair owners. The FX word for Correlational shifts is Realignment as the first side of the exchange rate re aligns from subversives to rightful owners.

Early warning signs to Correlational shifts are range and price noise vs variation problems to cross pairs. Current offenders are GBP/CAD, GBP/NZD, AUD/NZD, EUR/AUD, GBP/AUD, USD/CHF and EUR/GBP.

Long term trade forecasts hold for 3 to 4 and 5 ish months. Depends on movements.


USD/CAD oversold supports below are located at 1.2840 and 1.2853. USD/CAD at 1.2900’s contains just ahead the 5 year average at 1.3034. Break at 1.3034 longer term targets 1.3465.

The problem with a 1.3034 break is GBP/USD at 1.3200’s is not close to its 5 year average break at 1.3111 and USD/CAD is overbought from longer dated averages from 1.2600;s and 1.2300’s.

Any price above 1.2893 is open to shorts to eventual break at 1.2850 and 1.2840 to target 1.2738.

Nothing happening to USD/CAD long term and no brainer trades. USD/CAD serves its current purpose as day and weekly trades.


EUR/CAD trades a range from 1.4482, 1.4523 to 1.4628, 1.4663 and 1.4696. Massive hurdles continue as next above at 1.4724, 1.4860 then 1.4910.

Long term target trades fails to exist. Best trades are daily and weekly. The only positive is if EUR/USD travels higher then EUR/CAD trades follows.

Weekly trade: short 1.4667 and 1.4677 to target 1.4599. The weekly entry coincides perfectly to day trade tops at 1.4656.


GBP/CAD trades from 1.7047 to 1.7131. Above 1.7131 becomes 1.7131 to 1.7229 and 1.7241. Below 1.7131 targets 1.7070. Below 1.7047 targets 1.6955. GBP/CAD is least favored to all CAD trades offered today.


AUD/CAD is the top exchange rate pair to the AUD universe and AUD/CHF at bottom while AUD/USD and AUD/JPY are middle currency pairs and trade between AUD/CHF and AUD/CAD.

AUD/CAD hurdles are located at 0.9193, 0.9312 and 0.9446. Above 0.9312 targets 0.9376. Above 0.9446 targets 0.9602. AUD/CAD’s overall target is 0.9376 and a long drop trade strategy. A long drop strategy informs AUD/USD higher. AUD/CAD is the best of the CAD trades.


NZD/CAD lacks any ability to long term trades. The lineup as follows: 0.8690, 0.8740, 0.8794, and 0.8866. Current NZD/CAD trades on the verge of 0.8740 at a do or die inflection point. Above 0.8740 targets 0.8790, below 0.8740 targets 0.8702.

Instead of long term target trades, range trades are the order of the day.

Brian Twomey

Long Term Targets: USD/JPY and JPY Cross Pairs

Long term targets are defined as 500, 7 and 1000 ish pip trades. To quote my friend No Brainer trades. Last JPY cross pair target trades were completed in April/ May for 2000 ish pips and posted with updates at fxstreet. In April, JPY cross pairs traveled lower with DXY when DXY achieved 93.00 highs and just prior to the 5 year average at 95.00’s.

JPY cross pairs today settled into 200 pip ranges or 100 pips on either side of vital MA’s. GBP/JPY is included as a JPY cross pair when correlations align to USD/JPY. In the past 3 weeks, GBP/JPY correlates to GBP/USD and excluded from JPY consideration.

The 2 main drivers to JPY cross pairs are USD/JPY and oddly CHF/JPY as both target much lower prices at USD/JPY 110.18 and 116.87 for CHF/JPY. For CHF/JPY contains vital lines at 122.47 and 117.90 and must break to target 116.00’s. Both USD/JPY and CHF/JPY are severely overbought.

CHF/JPY is a USD pair as it Correlates to USD/JPY at +99%, USD/CAD +84%, USD/CHF at +86% and negatively correlates to GBP/CHF at -91%.

USD/JPY main line break to target 110.00’s is located at 112.85. As 112.85 rises then longer term averages become more overbought which means USD/JPY’s fall will hit much harder and faster. Extreme prices for USD/JPY are located at 115.00’s and middle 114.00’s.

CHF/JPY extremes begin at 125.00’s. Both USD/JPY and CHF/JPY contain short only strategies and matches EUR/USD long only.

Part explanation to JPY cross pair 200 pip ranges is due to USD/JPY’s loss of correlations to EUR/JPY at -83%, AUD/JPY -51%, NZD/JPY -30% and +28% to CAD/JPY. Only current trades available to JPY cross pairs are daily and weekly.

EUR/JPY is supported below at 127.36, 127.04 and 126.33 Vs 129.21 and 129.32 above. A break at 129.32 begins a short only strategy.

CAD/JPY is supported at 86.17, 85.80 and 85.00’s across the board. Any price above 88.51 begins a short only strategy.

AUD/JPY is supported below at 79.87 and 80.91 Vs 81.90 and 82.51.
NZD/JPY is well supported below at 75.93, 75.54, 75.47 and 75.20. Any price above 76.88 begins a short only strategy.

Best trades are EUR/JPY and AUD/JPY as both retain high places to weekly rankings for each of the past 2 weeks.

Brian Twomey


EUR/USD from last week’s analysis had to break 1.1268 to continue the downtrend from its neutral position at 1.1300’s. EUR/USD broke l 1.1268 Wednesday and traded to 1.1223. Next lower points are located at 1.1226, 1.1189, 1.1180 and 1.1133.

EUR/USD’s target from the 5 year 1.1505 average is now located at 1.1041 and a rising target along with a rising average. EUR/USD’s problem to the downtrend target is not only the 5 year average rise but longer dated averages are deeply oversold and ascending.

While the 5 year average targets 1.1041, longer dated averages at 1.1500’s, 1.1700’s and 1.2000’s target middle to upper 1.1400’s. EUR then adopts a long only strategy as a lower EUR/USD is in contention against its own averages.


Last week’s trade offered as long to target at 113.97 and 114.11 then short to target 114.40. Highs achieved 114.23 and lows to 113.17 for a round trip trade at +159 pips. USD/JPY longs target this week 114.25 and 114.32 then short to target 113.41. A break at 112.85 target 112.29

USD/JPY weekly averages are rising yet the ascent is extraordinarily slow as noted by long targets offered over each of the past 6 weeks. Despite rising weekly averages, USD/JPY is astronomically overbought from 108.00’s and 109.00’s and targets 109.00’s on a longer term basis.

Trade Rankings

Trade rankings for the week distinguished by easy trades and profit pips as follows: EUR/USD, EUR/JPY, AUD/JPY, AUD/USD, EUR/AUD, USD/CAD, CAD/JPY, CAD/CHF, NZD/JPY, NZD/USD, AUD/CHF, NZD/CHF, EUR/NZD.

JPY Cross Pairs

JPY cross pairs earns high rankings due to not only oversold but all sit just above vital long term averages. EUR/JPY for example from 127.00’s is protected at 126.11 and 125.00’s, AUD/JPY 80.12 and CAD/JPY at 86.00’s.


NZD/USD and cross pairs move higher on the weekly ranking due to oversold NZD/USD and NZD cross pairs. NZD/USD’s brig break to resume the downtrend from neutral had to break 0.6675 and NZD achieved 0.6701 lows. NZD/USD driving prices are located at 0.6843 and 0.6902. Above targets 0.7000’s to 0.7200’s.


GBP trade rankings as follows: GBP/USD, GBP/JPY, GBP/CHF, GBP/NZD, GBP/AUD, GBP/CAD.


Last week’s GBP/USD levels : 5 year average and rising line is located at 1.3109 then 1.3361, 1.3448 and 1.3485. At 1.3361

Current weekly vital levels are located at 1.3111 and 1.3156 Vs 1.3357, 1.3445 and 1.3464 .GBP/USD trades 201 pips from 1.3357 to 1.3156 and down from 252 pips last week.

GBP/USD lower averages are rising vs a drop to higher averages. A showdown is on the way.

GBP/JPY correlates to GBP/USD this week at 85%, last week at 81% and 2 weeks ago at 60%. GBP/JPY is solidly in the GBP/USD universe. Overall GBP/USD and GBP/JPY are oversold and no changes to GBP/JPY levels from last week at bottom 148.10 then 150.37, 150.67, 151.03, 151.25 and 151.92.

USD/CAD begins the week severely overbought while USD/CHF must break 0.9213 to travel lower and oversold USD/JPY 112.85.

DXY remains stuck between 95.25 to 97.16 then 97.62, 98.14, 98.47 and 98.62.
Overall currency market price ranges are severely compressed and further compressing.

Brian Twomey


The Boe Watch took informed probabilities were correct yet the BOE raised against probable expectations. Last BOE meeting probabilities were correct yet BOE failed to raise against probability expectations. RBNZ probabilities at 44% informed the RBNZ won’t raise. The RBNZ raised. Probabilities are failures.

What works is the 5 day Rule and 90 day interest rate. A 5 point movement or more in 5 days then raise or lower expectation are high to guaranteed. No 5 point move then no interest rate change as interest rate traders are the smartest and most correct among us as they trade inside tiny intervals.

The BOE raise to 25 places Sonia 6 points below at 0.19 and inside a large range from 0.1466 to 0.3337 and the 5 year average at 0.3543. What 25 and 19 does for GBP is nothing and no change. Levels are different but the same old story remains due to the 6 point creation by the BOE from Libor elimination.

BOE 25 now aligns to the FED at 25, SNB at 25, BOC at 25, ECB from 0.42 to 0.50. The RBNZ is high at 75 and RBA low at 10. The RBA should raise next to the vicinity of 25 to match central bank counterparts. BOJ at 0.90 is the wildcard in the mix to lower or remain at 0.90. The BOJ Call rate is the only central bank with an active interest rate market.

To delve further, the Japanese Euroyen Tibor rate is the offshore rate since 1986 and currently trades all December from 0.0310 to 0.1610 or 13 points. Euroyen Tibor is applied particularly for overseas repatriations to Japan. Once the premiere rate for EUR/JPY trading but was eliminated years ago due to the vast 13 point range.

USD/JPY Weekly Trade

USD/JPY long target achieved 113.97 and 114.11. Highs traded to 114.23. Shorts to target 113.40 achieved lows at 113.44.

Long +80 ish pips and shorts +79 PIPS or total +159 pips. USD/JPY’s weekly range 104 pips. The weekly trade profit was 1.5 times the weekly range.

What separates GBP from counterpart currencies is ability to leave ranges. From GBP/USD 1.3315, GBP/USD traded to 1.3375 or 60 pips. The 60 pips is right at range high ability and matches all past years.

Since BOE informed rate rise from the 7 to 8 am EST hour, a free money trade existed to target 1.3315. By the 9 am hour and ECB time, GBP/USD traded to 1.3327 or 47 pips. GBP/USD eventually achieved lows at 1.3303.

Last week’s GBP/USD levels : 5 year average and rising line is located at 1.3109 then 1.3361, 1.3448 and 1.3485. At 1.3361 was the downside level for shorts.

Next week vital levels are located at 1.3111 and 1.3156 Vs 1.3357, 1.3445 and 1.3464 .

GBP/USD lower averages are rising vs a drop to higher averages. A showdown is on the way. A close price in the 1.3260 vicinity then long GBP/USD next week.


GBP/JPY correlates to GBP/USD currently at 85%, last week at 81% and 2 weeks ago at 60%. GBP/JPY is solidly in the GBP/USD universe.

The bottom price is found at 148.10 then 150.35, 150.67 Vs above at 151.03, 151.25, 151.65, 151.84 and 151.90. No changes since last week. A close today at 150.80 ish then long for next week.


EUR/USD downtrend begins on a break at 1.1272. EUR long and short averages are rising as the new downside target is now 1.1040. EUR/USD driving averages are located at 1.1471, 1.1504 and deeply oversold 1.1584. EUR/USD targets 1.1430 then 1.1454 and long only strategies.

Despite the 1.1040 target, no confidence exists to target completion. Longs will pay far more than shorts.

EUR/USD 5 vital numbers today: 1.1289, 1.1306, 1.1314 Vs 1.1376 and 1.1405. Long at lows and short at tops for multiple profit pips.

Brian Twomey


Nasdaq achieved target at 15088 from 15600’s for +600 ish Points. Lows traded to 15049 for an extra 39 points. Now at 15500.00 and short only strategy remains.

FTSE traded to lows at 7166 from 7311 and targets 7132. Trade runs +145 points. Short only strategy also remains however FTSE is a horrible index and S&P’s are much better as both move daily for the same point movements.

S&P’s lows from 4700’s achieves 4606.33. Trade runs + 94 points. Short only strategy as miles of downside remains to 3800;s. Targets are located at 4497.09. then 4268.80, 4032.75, 3859.03.

USD/JPY weekly trade as written Sunday, USD?JPY targets 113.97 and 114.11 then shorts to target 113.40. Highs achieved 114.23.

Gold as written contained massive resistance at 1793 and 1805 and held. .Targets 1768.86, 1745.66, 1730.20. Gold traded to weekly lows at 1753 between 1768 and 1745.

Gold actually traded 40 points from 1793 and failed to achieve 1/2 its 119 point range at 59 points. Gold is not worth the effort as better trades exist.

Overall, 19 currency pairs achieved targets this week. The weekly target routine hasn’t changed since 2012 as seen from years of prior posts.

Powell and the Fed offered 35 ish pips upon taper release. Only 35 pips and not usual 50 pips. Fed Funds as Powell stated will remain at 0.09 for the remainder of 2022. Fed funds traded 0.08 everyday for the past 2 and 3 months and no changes.


GBP today targets 1.3315 upon a break at 1.3281, 1.3294 and 1.3306, Then short from 1.3315 to target 1.3256. Break 1.3248 targets 1.3197 and 1.3183. Then long to target 1.3218.

GBP/JPY bottom price as written Sunday held at 148.09 and GBP/JPY bounced fro 149.76 to highs at current 151.74. Longer term GBP/JPY broke above vital 151.26. Next hurdle is located at 151.96.

GBP/JPY short entries today are found at 151.83, 151.92 and 152.02 to target 151.35. Then short break 151.26 to target 150.51 upon break at 150.69.

GBP/NZD short just ahead of 1.9598 and targets 1.9499.

Brian Twomey

Sonia, BOE Watch, GBP/USD

As GBP Libor ends for this month of December, Sonia and Ronia are the only transition interest rates and Sonia as most vital. As the Sonia panel from the BOE discussed, the reason for such a huge GBP jump last month was due to the vast majority of GBP liquidity attached to short term instruments.

Liquidity defined by OIS. OIS is factored from average money and number of Sonia and Ronia transactions Vs the rate at each transaction

With the false hype of BOE raise, nobody valued a raise or no raise decision but decided to avoid risk. Once the decision was reached, a massive readjustment occurred to GBP and all financial instruments.

Note from yesterday Sonia’s 6 point spread to headline. All GBP trading in exchange rates derivatives, yields and the whole GBP market complex is traded within Sonia’s 6 points. The FED , Fed Funds and all central bank overnight rates applies to the same tiny moves. This is the new Risk free interest rate concept upon Libor elimination.

The 6 points are defined and traded within small percentiles to highs and lows and to hold the 6 point boundary. For Fed Funds to equal Sonia’s 6 points then Fed Funds trades 3 points per day and right at 3 ish points for Eonia and the ECB’s Euronia Repurchase Agreement Rate index.

Traded within the 6 points per year are 30 trillion GBP to Sonia Futures, Swaps, derivatives of all sorts to include Floating Rate Notes.

DXY from Fed Funds 3 points yesterday traded 10 pips, 48 pips Monday and 38 points Friday. GBP/USD due to 6 points traded yesterday 48 pips, Monday 64 pips and 60 pips Friday. As GBP Libor eliminates completely and Sonia trading is more perfected, GBP/USD daily and weekly ranges will substantially drop. This includes all currencies, all financial instruments and all central banks.

I applied GBP/USD for example to the new 6 point arrangement and what’s coming is today’s ranges drop to just at 1/2. GBP/USD at 60 ish pips per day already dropped by 1/2 and will drop another 1/2 very soon.

The rude awakening will come to those trading by charts, indicators and Fibs as a severe adjustment is required to strategies. View NZD/USD and the RBNZ 50 point raise. NZD/USD traded 100 pips.

The same principle exists today as in January 1972 when the free float by interest rates began. A currency or financial instrument moves and trades by an interest rate. No movement by an interest rate then no movement to currencies and financial instruments.

The difference today from 1972 is central banks killed off interest rate market movements so in turn killed off traded markets. All market price action moved and will move to banks to trade buy/ sell and lend/ borrow rates, repurchase agreements and derivatives within tiny 6 and 3 point channels.

For interested, the BOE contains every month all Sonia information, market notices, charts and graphs. Once, they published vital numbers but moved today to charts. WMBA Limited contains all Ronia information, charts and graphs. Secondly, despite changes ahead, Brian Twomey is well prepared.


Sonia’s average move from 1 year to 5 year monthly averages is 22 points. A 25 point rise maxes the average.

From 0.0457 and today’s 0.0468, Sonia trades below 0.0493 then 0.1466 and 0.3337. A BOE rate rise to 0.20 places Sonia targets to clear 0.0483, 0.0493, 0.0731, 0.0808 and 0.0888. Sonia then trades from 0.0493 to 0.1466 at 0.14 and bumps against the average at 0.1466.

Sonia’s average move per month however is barely 10 points. Assisted to the rate rise scenario is 0.0493 is severely oversold but the target is 0.0483 or 0.0015 points or 15 thousands.

Sonia oversold begins at the 4 and 5 year monthly averages to the 10 year monthly average. Any Sonia drops factors to more oversold from 4 to 10 year monthly averages. The 5 year average is located at 0.3543 and 10 year at 0.3935.

An interest rate rise is on the way and a higher GBP/USD but the question is when and how far. The mid point from the 5 year to 0.0493 is located at 0.20 and places headline at 0.25. The mid point from the 1 to 10 year average is found at 0.2214 and headline at 0.27.

The BOE Watch tool reports today 100% no change Vs 52.5% yesterday and 37.5% 1 week ago.

How good is BOE Watch. I have 38% but a step further as Odds at 48% raise Vs 51% against from 0.046 to 0.049. The BOE Watch tool is accurate.

GBP/USD for the week traded 90 pips and within 2 vital points at the 5 year average at 1.3109 to 1.3361.

For today, GBP/USD shorts at 1,3304 and 1.3296 to target 1.3245. Then short 1.3238 to target 1.3186. Long 1.3186 to target 1.3205. Longs and shorts are traded to maximize profit pips.

Brian Twomey

Sonia Vs Ronia, CME’s BOE Watch Tool

On this day according to the CME’s BOE Watch tool, 100% probability existed to no interest rate changes. Yesterday December 13 existed a 50% probability existed to raise Vs 50% to no change. On December 7 or 1 week ago, a 30% probability existed to no change and 70% chance to raise. On November 12 or 1 month ago, a 100 probability existed to a rate hike.

Sonia closed at 0.0468 from 0.0505 1 month ago Vs BOE’s headline rate at 0.10 and offers a 6 point range. Factor Ronia or the new Repo rate index as the fun rate to Sonia and created in 2011 against a new Volume Weighted Average methodology to calculate the index in 2018 then the Sonia Vs Ronia range becomes about a 1 point difference.

Ronia’s quarterly statistics for example and the last available data, here’s the VWAP rates. July 2020 Average 0.0834 vs highs 0.1335 and lows -0.0230 or 5 and 6 point difference. August 2020 VWAP average 0.0729 Vs highs 0.1180 and lows 0.0107 or 4 points and 6 point difference. September 2020 VWAP average 0.0757 Vs highs 0.1150 and lows 0.0248 or 3 and 5 point difference.

The Ronia rate is then compounded daily and released by the BOE. Monday’s Compound index then appears as 101.36993867, Friday as 101.36956291 a difference of 37576.00.

GBP/USD from 2018 to 2021 ranged 2300 pips from 1.1900 to 1.4200’s and 3900 pips from 2015 to 2018 as 1.5900’s to 1.1900’s.

Repo rates in the BOE interest rate system were once available as individual rates to cover 1 week to 1 year. The Ronia Index folded individual rates into an index.

Since Sonia is the big rate with available data, Sonia becomes the overall factor to oversold or overbought interest rates and GBP direction. Compound rates are daily rates since 2018 and not available as monthly averages while Ronia rates require a payment.

As mentioned before, never ever pay market people one nickel as many other ways exist to factor accurately GBP by interest rates. Like Currency analyst webinars, they should pay us to listen.


As written 7311 short point and targets are found at 7162.79 and 7123.19. Lows achieved yesterday 7226 for +85 points.

S&P’s and NASDAQ

From 4700’s , lows achieved 4669.15 and +30 pips. Long way to short targets. NASDAQ achieved 15,4000’s for +200 points and long way to short targets.

EUR/AUD broke 1.5810 and traded to 1.5893 highs. Short only is the strategy around 1.5910 vs long AUD/USD.

EUR/USD now 6 attempts to break 1.1260’s since Friday and all failed. EUR/USD traded today to 1.1265 and bounced again 50 pips to 1.1315. EUR/USD becomes oversold at 1.1278 and 1.1268. Long drops is the only strategy.

GBP/USD highs today are located at 1.3279 on a break of 1.3245.

Brian Twomey

BOE Watch Tool

MPC Futures
Meeting Probabilities
Meeting Date0.100.200.300.400.500.600.700.800.901.
12/16/2021100.0 %0.0 %0.0 %
2/3/20220.0 %17.5 %82.5 %0.0 %0.0 %
3/17/20220.0 %4.8 %35.4 %59.8 %0.0 %0.0 %0.0 %
5/5/20220.0 %0.0 %1.2 %12.5 %41.5 %44.9 %0.0 %0.0 %0.0 %
6/16/20220.0 %0.0 %0.0 %0.8 %8.8 %32.0 %43.8 %14.6 %0.0 %0.0 %0.0 %
8/4/20220.0 %0.0 %0.0 %0.0 %0.2 %3.2 %15.8 %35.6 %35.0 %10.2 %0.0 %0.0 %0.0 %
9/15/20220.0 %0.0 %0.0 %0.0 %0.2 %2.5 %12.6 %30.6 %35.1 %16.4 %2.6 %0.0 %0.0 %0.0 %0.0 %
11/3/20220.0 %0.0 %0.0 %0.0 %0.0 %0.2 %2.4 %12.4 %30.2 %35.0 %16.9 %2.9 %0.1 %0.0 %0.0 %0.0 %0.0 %

Brian Twomey

BOE Probabilities CME BOE Watch

Target RateProbability(%)
Now *1 Day (12/13/2021)1 Week (12/7/2021)1 Month (11/12/2021)
Ease0.0 %0.0 %0.0 %0.0 %
NoChange100.0 %50.0 %30.0 %0.0 %
Hike0.0 %50.0 %70.0 %100.0 %
* Data as of 12/14/2021 2:23 AM CT


CME Bank of England Watch Tool

Meeting InformationMeeting DateContractExpiresMid PricePrior VolumePrior OI3 Feb 2022MPCZ13 Feb 202299.9050139ProbabilitiesEaseNo ChangeHike0.0 %0.0 %100.0 %
Target RateProbability(%)
Now *1 Day (12/13/2021)1 Week (12/7/2021)1 Month (11/12/2021)
Ease0.0 %0.0 %0.0 %NaN
NoChange0.0 %0.0 %0.0 %NaN
Hike100.0 %


Target RateProbability(%)
Now *1 Day (12/13/2021)1 Week (12/7/2021)1 Month (11/12/2021)
Ease0.0 %0.0 %0.0 %NaN
NoChange0.0 %0.0 %0.0 %NaN
Hike100.0 %

Brian Twomey

Gold and FTSE 100

The Gold price is not only overbought but sits at a critical juncture. From the open at 1783.20, next above is located 1793.72 and 1805.10.

Targets above 1805.10 and excellent short entries are found at 1818.48, 1864.53, 1874.58 and 1912.09.

Below 1.1793.72 targets 1768.86, 1745.66, 1730.20 and 1696.42.

Gold’s overall range is found from 1793.72 to 1674.31 or 119 points then 1594.72. The 5 year average is positioned at 1542.31.

Recall the August 2021 Gold post as the 5 year average was then 1510.03. The 5 year average rose 32 points in 4 months. The April 2021 post, Gold ranged from 1846.05 to 1693.27 or 152 pips as opposed to 199 points today.

Overbought begins at the 5 to 10 year monthly averages. From the 5 to 10 year averages, 1500’s and 1400’s are many and strong supports.

A viable trade for many many points is non existent. Day trade ranges roam from 9 to 12 and 18 points on a good day. No changes over many months of day trades. Gold is a dead traded instrument.

FTSE 100

From the open at 7291, FTSE monthly averages are non uniform and located all over the map.

The 5 year average is located at 7018.20 then many and massive supports exist from 6800’s to 6900’s.

The next short targets are found at 7162.79 and 7123.19.

Short entries are best found at 7311.88, 7350.79, 7364.77 and 7416.47 then range tops at 7524.09 and 7563.02.

Not much happening with FTSE

Brian Twomey


Covid 19 is a variant from Sars (2002) and Mers (2012), known as coronaviruses and produced from the Wuhan Lab in China although Mers was originally found in Saudi Arabia. The commonality is all are respiratory diseases.

The original Covid 19 virus mutated as all viruses to form Delta then Omicron. The positive is once Covid mutated to Delta then the first signs and warnings existed to Covid’s death as a virus. The next mutation to Omicron informs the virus is finished and will soon die however more mutated variants may exist from Omicron but far less as a menace to worldwide societies.

EUR/USD again at 1.1300’s is a neutral price in relation to the rising 5 year average now at 1.1502. The figure 1.1502 is derived from the 2020 to 2021 move from March 2020 at 1.0637 to January 1 at 1.2346. The 5 year average at 1.1502 happens to coincide to the past move.

EUR/USD to continue the downtrend and break from neutrality must cross below 1.1268 then 1.1221. On Friday, EUR/USD failed on 4 attempts to break 1.1260’s then bounced back to its neutral position at 1.1300’s.

GBP/USD highlights the currency market story this week as most currency pairs are locked between solid average points. GBP/USD’s 5 year average and rising line is located at 1.3109 then 1.3361, 1.3448 and 1.3485. At 1.3485 is oversold and forces the 5 year average at 1.3109 higher. A 252 trade range for the week allows GBP/USD to earn number 1 spot to overall GBP rankings.

The wildcard is GBP/JPY as it sits between the 10 and 15 year averages from 150.31 to 150.78. GBP/JPY averages are dropping and the bottom price for the week is located at 148.09. GBP/JPY must break 151.26 then 151.96 in order to target much higher prices to 155.00’s and top of the range at 157.00’s.

Current GBP/JPY is oversold from higher averages and Correlates to GBP/USD this week at +81% and up from +60% last week.

NZD/USD from 0.6700’s also sits at neutral from its 5 year average at 0.6843. NZD/USD’s downtrend to begin must break 0.6673 and a 0.6500 target. .Above 0.6843 targets next 0.6928 then 0.7247. The target at 0.6504 is currently 200 pips from current 0.6700’s. NZD/USD has been a dead issue over past weeks and contained between vital averages.

NZD/USD neutrality forced EUR/NZD and GBP/NZD into a comfortable trade range between EUR/NZD 1.6415, 1.6578 and 1.6832. Current EUR/NZD sits between 1.6578 and 1.6832 while GBP/NZD is locked from 1.9179, 1.9463 and 1.9599.

The pairs to watch over this and upcoming weeks is AUD/USD, EUR/AUD and GBP/AUD. Despite AUD/USD’s neutrality, 0.7101 must break to move AUD lower. AUD/USD achieved target at 0.6900’s from 0.7300’s and is now in an uptrend. AUD/USD dropped 400 pips from 0.7300 and rose 200 pips to 0.7100’s.

EUR/AUD’s 2 major lines moving lower are 1.5810 and 1.5773. EUR/AUD trades below. Deeply oversold GBP/AUD higher forces AUD/USD lower however on a long only strategy. to target lower 0.7200’s.

USD/CHF and USD/JPY begin the week oversold and the deciding factors are 0.9210 and USD/JPY 112.70 while USD/CAD as this week’s odd ball currency in the trifecta, begins the week overbought.

USD/CAD is stable inside 400 pip ranges from 1.2204 to 1.2612 and 1.2612 to 1.3036 and no changes over past weeks. GBP/USD 1.3109 and USD/CAD 1.3026 as defining points to overall currency markets are expected to hold this week.

USD/JPY is the best trade due to wide ranges and targets easily 113.97 and 114.11 then shorts target 113.40. USD/JPY weekly trades offered over the past 4 and 5 weeks are the exact same trades as entries around 114.00’s and targets at 113.31. No different this week to locked ranges.

DXY opens the week at 96.05 and a break at 95.52 changes USD to shorts. DXY ranges at 164 pips are located from 95.52 to 97.16

The 10 year yield begins the week at 1.482 and broke the range as posted October 31 at 1.4941 to 1.5182 yet held the larger range from 1.2290 to 1.6146. Since Oct 11 when the 10 year traded to 1.6146, the 10 year dropped 12 points and 36 points from 1.7050 over the past 3 months.

Overall Currency markets begin the week fairly average yet stable within ranges as no big breaks are expected.

Brian Twomey