[Week 06 - 2023] Trades Recap and Trade Setups

Hey Traders,

Earlier the week, the FEDs hiked rates by 25 basis points as expected, but Powell has transitioned his tone to be less hawkish as the word "deflation" is brought up. The market was euphoric prior to and following the FED's decision, but all of that came crashing down after the Non-Farm Payroll (NFP) released shocking numbers accompanied by the unemployment rate falling rather than rising.

All of these pushed the United States Dollar higher due to the strong economy, and that gave rise to concerns that the FEDs might need more rate hikes and keep rates higher for a longer period.

Upcoming Economic Release:

S&P500 Futures

Equities continued its climb towards the upside earlier on the week. However on Friday, the S&P500 posted a decline forming a bearish engulfing candlestick at the resistance level at 4181 region, potentially indicating a short term reversal for the S&P500.

Dollar Index (DXY)

The United States Dollar extend towards the upside from the low towards the minor resistance level at 102.75. It will be difficult for the Dollar to have a confirmation breakout of the key resistance level at 103.225 if price were to continue its upside movement without any form of retracement or consolidation. Expect the Dollar to trade within the 102.75 region, neutral zone at between 101.48 to 102.1 and bearish when price were to breakout of 101.48 support region.

Gold Futures

Gold experienced a sharp reversal from the 1963 resistance region and closed the week with a strong bearish bar. As the downside move is extended and lies at the support region of 1880, expect some retracement or consolidation in the coming week.

Trade Recap

Soybean Meal Futures - Front Month (Exclusive Trade)

Recap (Week 05 - Last Week) Take Profit - 3

Long at market position reached Take Profit - 3 level where we announced to close fully.

Cotton #2 Futures (Exclusive Trade)

Recap (Week 05 - Last Week) Take Profit - 1

Short at market position reached Take Profit - 1 level where we announced to close / partial / risk free.

Gold Futures (Exclusive Trade)

Recap (Week 05 - Last Week) Stopped

Short at market position stopped out. We took on more pain for this trade because we were firm on the reversal of Gold. However this only happened on the release on Non Farm Payroll, reflecting the hot economy thereby pushing the strength of the Dollar while weakening Gold.

Trade Analysis / Setups

NZD/CAD (Analysis 6-1)

Analysis: Price can be seen as overextended where it will likely begin to trade within the range or begin reversal. We will take a reversal position with the initial Take Profit level set at the potential ceiling of the consolidation.

Long opportunity: At market reopening as high risk trade towards 0.85030 as Take Profit - 1 level.

Cheers to all our member who managed to pack some profits this trading week.

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