We Look for Trading Opportunities on a Busy Week for Forex Traders
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Weekly Summary of Forex Trader Sentiment and Changes in Positioning
It’s been a busy week for our sentiment-based trading strategies, as our volatility-friendly Breakout2 system did well selling into the Euro breakdown versus the US Dollar, Australian Dollar, and Japanese Yen. We wrote earlier in the week that we liked the EUR breakdown trades as long as it remained below $1.2880, but the fact that key Euro crosses are trading near critical support warns against chasing recent weakness.
The Euro has been the main attraction as most other pairs have consolidated, but a key shift in Australian Dollar sentiment led our sentiment-based Momentum2 system to sell and completely shifted our AUDUSD trading bias. Past performance is not indicative of future results, but said system has caught a number of key turning points in the AUD through recent history. The fact that it lines up with our technical trading bias lends further weight to our shift towards calling for AUDUSD weakness.
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--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.