[Week 37 - 2023] Trades Recap and Trade Setups

Hey Traders,

There was a degree of sentiment shift towards risk off as European Central Bank (ECB) displayed signs of hawkishness for the upcoming conference. The United States Dollar meanwhile strengthen further putting more pressure on risk on sentiment.

Market looks to be on high alert and with the heavy schedule this week. Expect volatility.

Upcoming Economic Release:

S&P500 Futures

The S&P500 struggled earlier on the week but recovered majority of the move on Friday. However, price still remains at neutral territory. With the appreciation of the United States Dollar and oil prices, equities are barely holding on and can potentially crumble if the upcoming CPI report display anything negative.

Dollar Index (DXY)

The United States Dollar index continue its ascend, closing the trading week with 4 days of gains. The Dollar can be seen as extended but not severely, as such we believe short positions can be taken for potential consolidation or retracement move which we discussed further for our weekly setup.

 Spot Gold

As mentioned in our previous post, we believe there is a higher change that price will begin to consolidate or retrace which was what exactly happened last week. Gold price looks weak in the short term as it trades back below the 4 hour - 50 exponential moving average (EMA), supported by a retest confirmation but within the support region of 1912. If the support region does not hold, we can potentially see more downside for Gold.

 Trade Recap

No updates

Trade Analysis / Setups

Dollar Index - Front Month (Analysis 37-1)

Analysis: Price continues to push towards the upside after prior minor retracement. Price is now back to extended range and is poised for a consolidation or retracement. Being only moderately extended, smaller position size is advised.

Short opportunity: Short at market reopening towards 104.635 as Take Profit - 1 level.

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