I held off posting this on Sunday and Monday hoping for a definitive move either higher or lower on the Dollar so I could get a read on the weekly trend. Unfortunately the markets are not cooperating with me. Before I get to my outlook I want to say that the currencies for me are a secondary market that I trade, and I have no problems sitting out for a time until the markets get into more predictable movement. In fact, lets be honest the whole purpose of learning Technical Analysis is to find predictable market movement so it benefits us to wait until the market is in these patterns.
As I have stated in my previous currency outlooks I like to first look at the US Dollar to get an idea of trends before placing trades. If the dollar looks to be moving higher, I buy short the Euro or Pound, if the dollar is moving lower I buy the Euro, Pound, etc.
This week so far we have a US Dollar that is not moving anywhere. While the overall trend suggests a Wave 4 rally followed by a Wave 5 decline right now we are in a sideways non trending area. I will be waiting on the sidelines until we either break above the Blue Trend Line (short the Euro, Pound, etc) or break below the Red Trend Line (long the Euro, Pound). While this market stays in the channel I'll hold off trading and wait it out.
Ron Wheeler
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