Forex: Adjusting to Market Conditions, Trading Short-Term EURJPY and GBPUSD
- The yen crosses produced tantalizing breakouts alongside a sustained equity rally
- Yet, risk positive moves face serious momentum curbs in both the near and medium-term
- With a market contrained by Fed speculation, it is best to turn down the time frames on charts
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EURJPY led most of the yen crosses towards notable technical breakouts - offering an FX interpretation of 'risk appetite'. Alongside the S&P 500's rally, this looks like a good pairing of technical and fundamental evidence of trade development. However, there is a serious hang up to such trades: the Fed rate decision next week. Sustaining a strong risk appetite or risk aversion move with this event risk on the horizon will be difficult to muster. Yet, the potential is there is the short-term. To assess the opportunity of a short-term EURJPY reversal, GBPUSD break above 1.5750 or AUDJPY break in either direction; moving to the lower time frame charts is prudent. We discuss the short and medium-term outlook along with its trade view in today's video.
Find out what event risk can threaten the trade setups discussed in today's video with the DailyFX Economic Calendar.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.