Weekly Forex Forecast (03/10/22) EurUsd / XauUsd + Forex Trading Plan! [HD]
![Weekly Forex Forecast (03/10/22) EurUsd / XauUsd + Forex Trading Plan! [HD]](/pic/weekly_forex_forecast_03-10-22_eurusd_-_xauusd_forex_trading_plan_hd_/ODU4YmdZQTRiRGs_.jpeg "Weekly Forex Forecast (03/10/22) EurUsd / XauUsd + Forex Trading Plan! [HD]")
foreign ERS it's John Fortune here with this week's weekly Forex forecast I hope you're having a fantastic weekend we are coming into a new month and also the final quarter of 2022 and there are alarm Bells going off all over the place about a potential stock market capitulation this quarter this is not fear-mongering this is not click bait and we're going to go through in today's video some of those bright red flashing signs warning of a potential incoming stock market capitulation okay so let's have a quick look at the economic calendar because at the end of last week we had an extremely important piece of day to come out that was the core pce inflation data and headline pce inflation data why is this very important well because pce inflation is Jerome Powell the Federal Reserve chair that's his preferred measure of inflation and last week at the end of last week it came out and it came out not only increasing but increasing at a faster rate than was expected the idea of a Fed pivot if it wasn't already is obviously dead the FED is not going to Pivot until something breaks I have been trying to warn all year that the FED is not going to Pivot and that you cannot compare the current macro backdrop to that of say 2018. if anybody wasn't sure this should finally drive home the idea that the FED is going to raise rates until something breaks and then it will pivot of course at some point the FED will pivot because it's not going to allow everything just to collapse into dust but that time will come most likely especially with inflation accelerating and in fact re-accelerating the FED pivot is likely to come only after something breaks if we have a quick look at the data which is coming out this week we do have ISM coming out on Monday which is important ISM Manufacturing on Monday and the ISM services on Wednesday out of the US and also non-farm payrolls out of the us on Friday if you get beats in those pieces of data they come out better than expected this is going to drive the dollar higher and also apply downward pressure on stock so keep an eye on those but apart from that in terms of short-term Trading we do have an interest rate decision out of Australia and we also have an interest rate decision out of New Zealand so when we look at the Aussie Pairs and the New Zealand pairs in today's video just bear in mind that they will probably do nothing into their interest rate decisions and the opportunities will come from Tuesday Wednesday onwards in those pairs okay so let's have a look at the scores for the coming week and you can see there are warning signs flashing in the scores for the major currencies this week now I can tell you for those of you who are not signed up as GMT members this is also the case in the other markets Commodities stocks and also bonds are also flashing warning signs here of risk off incoming and you can see one of the first signs of this is that the commodity currencies for the first time in a long time are starting to pull on the right hand side of the scorecards we are seeing the New Zealand dollar as the weakest we're seeing the Australian dollar and we're also seeing the Canadian dollar week as well and the only one left in there which is the pound is actually scoring plus two this week going from minus four last week to minus two and so the pound is moving this way and this is exactly what you would expect to see if you had an incoming risk-off move because in a market crash for those of you who have done the free GMT course you will know the pound outperforms the New Zealand the pound outperforms the Australian dollar the pound outperforms the Canadian dollar generally speaking so how the scorecards are starting to align now heading into Q4 is suggestive if the dollar the Swiss franc the Japanese Yen the Euro and the pound are set to start to outperform the cad the Aussie and the New Zealand which are the commodity currencies that is exactly what you would expect to see in a market crash Okay so we've got two things now that we're looking at here going into October and also Q4 of this year one is that core pce inflation data and pce inflation data the federal reserve's preferred measure of inflation is not only coming down it's re-accelerating and it's doing so at a fast pace than expected setting in stone essentially the fed's commitment to keep tight monetary policy in place and the second thing we now have after that is the currency Majors essentially the scorecards predicting a flight to safety over the next 20 trading days of course this is on a rolling basis updated every day but as it currently stands the scorecards are predicting a flight to safety and if you see this materialize the New Zealand dollar the Aussie dollar and the Canadian dollar all underperforming the rest of the currencies that is exactly what you would expect to see in a flight safety in a market capitulation okay so with that said let's focus on the short term which is next week because I am talking about next quarter doesn't have to happen straight away next week if we are going to see a deterioration in the U.S stock market and we go and see a kind of a waterfall sell-off or a capitulation but focusing on the short-term opportunities next week so separate what we've just discussed which is bigger picture Q4 to next week in the actual Market I do favor long US dollar plays I do favor long JPY plays and I would prefer to trade those next week vis-a-vis short Australian Dollar short New Zealand and also short CAD I'm not interested in short pound next week because the pound is moving this way and if we go from -4 to minus two so coming off of oversold for the first time this is actually a signal to cover any short positions in the pound and look elsewhere uh I am also not as focused on Frank long plays because we are going from three to two so we're actually weakening that's why I prefer dollar long plays and Yen long plays next week vis-a-vis the cad the Aussie and the New Zealand but we are also in this video going to be looking at not just Swiss Franc versus CAD Aussie in New Zealand we're also going to look at the euro versus the cad the Aussie and the New Zealand although they're not the top setups next week I want to add these in to show you exactly what's going on in the Forex markets and again more warning signs of a potential incoming capitulation in those pairs so let's have a look at the individual currencies before moving on to the markets themselves starting with the dollar now another very interesting thing we saw last week on the 29th you see this big down day this was also a down day in the SPX in the s p 500. now that is another warning sign when you start to see the dollar selling off at the
same time as the stock market this is usually due to force liquidation and although this was not a severe sell-off it was just very interesting that happened on the 29th and this is one of the things I would advise you to look for in the markets if we are set to have a stock market capitulation there is a very good chance you see the dollar Index selling off at the same time the stocks now that does make trading a little bit more difficult because obviously trading these kind of conditions is something that comes with inherent risk because of the volatility but if you go back for example and look at the 2020 covered crash what you'll see is at the same time the dxy fell down and on my Twitter page I actually posted a comparison of the two but you can go back and you can see that from February uh the 20th all the way down to the 9th of March the S P 500 was crashing the S P 500 crashed and at the same time the dxy fell from roughly the 100 level about five percent and then you saw the flight to safety so stocks crashed the dollar fell five percent and then you saw the flight to safety at the end of the crash that's very important because again if you are going to see a capitulation look out for that warning sign because that is very likely to materialize the dxy selling off first so I have to throw that in there because a it's another warning sign of what we could see in uh Q4 of this year but B that is something that you're going to want to look out for in real time because if it happens and we are long uh the dollar so for example if we're taking long dxy trades and stocks start to capitulate or sell off you could actually see the dxy selling off at the same time so you have to be prepared and have that information and that will help you be prepared that if you start sea stocks and the dollar selling off at the same time that is likely an early indication that stocks crashing we haven't really seen it yet we saw it on the 29th and so this is what I'm saying it's not necessarily going to happen on the Monday but keep an eye out for that because that would be certainly uh one of the pieces of confirmation that stocks are in fact crashing so not happening just yet and so going into next week I am still bullish on the dollar but just bear in mind if stocks really start to deteriorate you could see an initial sell-off in the dxy okay next is the Euro we came down and took out the target set at a 0.9670 the Euro has started to bounce and any continued pullback in the euro is simply viewed as another opportunity to look for shorts into the 0.95740. next is the pound now the pound took out the target set at the 1.1450 and then we had a huge sell-off in the pound and what actually happened was we had a crash and yes the word crash is applicable here I know it's overused a lot the word crash and personally I try to avoid using it because it is a little bit sensationalist but when there's a crash you have to call it what it is there was a crash in UK bonds and because of that the 30-year yield went through the roof and Pension funds in the UK pension industry started to get margin calls and there was it was reported as almost the Layman moment in UK K pensions so this is another alarm bill that things are starting to break we're at that point in the cycle where especially dollar strength but because of all the tightening and the macro backdrop there are things which are starting to come under pressure to the point of braking and the bank of England to show you how close that the UK pension industry probably was the disaster the bank of England actually intervened midweek instead of as it usually would do on a weekend or at a time of the markets not operating and it basically bought bonds to drive down the price of the 30-year yield and prevent the UK industry from basically imploding the UK pension industry from imploding because of all the margin calls they got so again these are all alarm Bells Guys these are all things that are telling you there are problems that are materializing at this point in the cycle because of the flash crash in the pound we basically just corrected next week and although I think we could see the pound coming down further it is not my main focus for shorts anymore I would prefer to look at the commodity currents next is the Swiss franc we did come and take out the target to the downside and although this is not a fantastic Long play I do think even if the Swiss franc comes down lower I do think the Swiss franc outperforms the Canadian dollar the New Zealand dollar and also the Australian dollar on a relative basis so not particularly bullish on the Swiss franc but I do quite like New Zealand Frank Aussie Frank CAD Frank to the downside not top setups the top ones are highlighted in Gold but you can also look at those heading into next week next is the Yen we did have the bank of Japan intervening but of course because it's not coordinated with the us back during the Asian crisis they coordinated with the US the US devalued the dollar and the bank of Japan intervened and as it currently stands this has not really had too much of an effect maybe it stopped the bleeding a bit but it hasn't reversed again I do think the Yen could actually catch a bid on a flight to safety if we see risk off taking over and that's the real risk it's not so much the boj intervention it's the overall macro backdrop here which is starting to play out so I am not particularly bullish on the end just as I was and particularly burst on the Swiss franc but I do think if we are going into a more risk-off environment and certainly the scorecards are telling us to be on the long side of the Japanese Yen vis-a-vis the New Zealand the Aussie and the Canadian dollar especially next is the cad we did take out the 0.7 7 to 9 30. I do think CAD shorts are now going to be one of the better opportunities heading into next week and likely into October as well any pullback in the cad pairs are simply viewed as an opportunity to look further declines with the cad coming down next to the 0.7088 as the next year of support Aussie dollar we took out the target set to the downside last week I am now looking for the declines in the Aussie and alongside the other commodity currencies I do think any pullback in this should be treated as one of the better opportunities to look for shorts in the Aussie pairs primarily vis-a-vis the dollar and the Yen and last but not least the New Zealand dollar we are heading down towards a 0.54660 so any pullback on the
way to this is viewed as an opportunity to look to get short for further declines in the New Zealand and again I would prefer to play those vis-a-vis the safe haven assets primarily the Swiss franc the Yen and the dollar and out of those three the dollar and the Yen as a preference okay so let's have a look at the markets themselves starting with crude oil and again we are going to look at the U .s stock market as well at the end of the video we took out the target at the 77.65 we didn't come down to the second target last week in crude oil because on Wednesday ahead of that pce data on Friday the dollar just reversed and corrected basically for the rest of the week into it going into this week I do still favor crude oil short we do have OPEC meeting on Wednesday if you go back to the beginning of the video and look at the calendar I skipped past it but we do have an OPEC meeting on Wednesday so any oil positions into that may be a bit risky but I am looking for any pullback in crude oil to be an opportunity for further declines into the 74.23 if we do start to see risk on really taking over in Forex uh stocks and bonds we're going to see that also in Commodities which is going to push Commodities lower and certainly crude oil will be negatively affected by an overall risk-off environment next is New Zealand dollar we corrected in New Zealand dollar and any pullback in this pair was highlighted previously as an opportunity to look further declines we started to sell off we have somewhat of a double top pit in New Zealand dollar going into this week I'd like to see any pullback possibly a retest under here and that would be an opportunity to look for shorts into the 0.5473 Aussie dollar we took out the target set at 0.6407 according to this week any pullback in this market as we are starting to sell off here with momentum any pullback is viewed as an opportunity to once again look for shorts down towards the next care of support 0.6214 next is dollar card this was a market highlighted to the upside and
we did take out the target to the 1.37150 we are almost at the 1.3 850 and remember because we're starting a new month in a new quarter you could very well see some pullbacks in these currencies so I wouldn't be surprised to take out there's clearly no opportunity to trade this now into the 1.3850 the move has already taken place so if it takes out this target first next week and then starts to pull back look at the distance to the next care resistance to 1.42560 remember I said previously when we looked at say pound Frank when you get big gaps in these levels these can often run quite quickly and go and have a look at pound Frank and see what that's been doing recently so any pullback I'd like to take out the 13850 first any pullback after that is viewed as an opportunity to look for bullish breakouts into the 142 560. and those are my top three dollar plays
that I'm going to be looking at next week next is euro dollar we did take out the Target 0.95960 and overall I am still bearish on this Market any pullback here is simply viewed as an opportunity to look for further declines into the 0.9413 but I do think there are better shorts than euro dollar because the euro is projected on a one month forward-looking basis to outperform the commodity currencies so if I am going to go long the dollar I'd rather go short New Zealand a dollar short Aussie dollar or long US dollar CAD but just taken in and of itself I am bearish still overall in fact both of these were in positive territory when we looked at the scorecards okay so moving on to the Yen pairs my favorite Yen short is New Zealand gen again we've started to break down already we're breaking out here of previous lows with momentum this is great so I'm going to be looking for a kind of Bear Flag setup any pullback like this next week is an opportunity to look for shorts into the 79.52 next is Aussie Yen really nice distance here into the next Kia of support and we also have a double top breakout somewhat of a double top breakout here with a second degree breakout for those of you who have done the free course we have a second degree breakout of failure and now going into this week any pullback perhaps a retest of the previous low but any pullback here is going to set up a great opportunity to look for shorts into the nine zero point five three and the final Yen pair we're going to look at is cadien and this looks like a great setup heading into next week look at this we've been consolidating after a strong momentum move down that was the boj intervention now we're just starting to break the lows so any pullback next week is viewed as an opportunity to get short in cadien and the next key of support is all the way down to the 101.76 now normally I would say maybe it will take you a couple of weeks to
get here but with the recent volatility who knows maybe we get there in a single week but CAD yen is definitely something I'm going to be keeping my eye on to the downside next week okay so those are my six top plays heading into next week those are the setups in the Forex Majors that I'm going to be concentrating on the most after that though we do have the Frank Pairs and also uh Euro pairs vis-a-vis the commodity currencies you can see we're starting to break out of this consolidation what I'd like to see is this could come down with more momentum any pullback after that perhaps sort of Tuesday or Wednesday would be viewed as an opportunity to look for shorts into the zero point five three zero zero Aussie Frank bear in mind we have the interest rate decision out of Aussie and New Zealand next week so as I said earlier in the video those are better looked at post the interest rate decisions and I will only be trading setups in the directions highlighted in this video if they reverse or move in the other direction I will still only be looking at shorting Aussie and New Zealand vis-a-vis these other markets so just bear that in mind volatility around the interest rate decision is not going to change my plan next week it may cause me not to trade the markets at all but it will not cause me to trade them in the opposite direction as highlighted in this video so Aussie Frank is also starting to break to the downside perhaps it does nothing into Tuesday and then we get some momentum down like this after Tuesday Wednesday look for a pullback and then that would be the opportunity I would look towards the back end of the week to the downside to the 0.6208 next is cabs rank we've started to break down below the low here and so any pullback if we Bounce from here early next week any pullback is simply viewed as an opportunity to look for bearish reversals down to the next care of support 0.7061 okay so we're going to wrap up the Forex pairs here with the Euro pairs normally I wouldn't add these in because the Euro only scores plus one so yes they do offer potential trading opportunities next week but the main reason I've added these in is because look at this this is an alarm bell ringing this is a sign of Market stress right now this is the Euro acting as a risk-off asset vis-a-vis the commodity currencies and what we're seeing here is essentially a flight to safety from commodity currencies into the Euro it's exactly what you see in times of serious Market stress so any pullback in the Euro next week perhaps into the New Zealand interest rate decision and then after the interest rate decision you can look for a breakout off of the interest rate decision then the following day you can look for a pullback and a move into the 1.8008 Euro Aussie look at this alarm Bell big momentum coming into your Aussie this is a risk off move this is a flight safety which you're seeing in the Euro not a safe haven asset like the dollar or the Yen any pullback into the interest rate decision is viewed as an opportunity to look for bullish breakouts on the interest rate decision and then any pullback after that for opportunities into the one point five three nine seven and last but not least we have eurocad now look at eurocad if I zoom out here major major inverse Head and Shoulders breakout right here again this is exactly what you would expect to see the Euro doing vis-a-vis commodity currencies right at a time of real Market stress and you're seeing that big momentum breakout to the upside so any pullback in this market is viewed as an opportunity to look for bullish breakouts I'm going to be looking into the 1.3715
okay so wrapping up with gold silver Bitcoin and the S P 500 as it currently stands the gold silver ratio is starting to break down from head and shoulders and I am looking for the 82.08 but it is kind of corrective if you look it hasn't really gone anywhere it's just kind of moving sideways so I don't have a very strong bias over whether I think gold or silver is a better short I am bearish on Gold Silver and Bitcoin still but on balance I would say gold is probably near term a better short if you see real risk off you would actually likely see silver start to underperform the First Market here is gold we took out the 1633.70 which has been a Target on here for a while to the downside you can see we're now sitting underneath the major breakout in gold and we're coming back essentially to what it looks like retested so any continued pullback in Gold especially if we trade back into the 1676-86 I am treating this as a pullback and I'm going to be looking for any breakdown as an opportunity to look for shorts down to the 15 75.72 next is silver we've kind of just moved sideways in silver since the 22nd over here however we have now started to break down you can see we broke out of here with momentum and now we are correcting so I'm treating this as a pullback and any continued pullback is simply viewed as an opportunity to look for shorts in silver down to the 16.96 next is Bitcoin now Bitcoin has been a short and we've been looking for the 16492 as a kind of longer term Target here however we haven't really gone anywhere in Bitcoin for a while in fact you can see pretty much all through September we just moved sideways so so nothing has really changed in my Outlook on bitcoin I am looking for the declines but the correction is just taking longer to resolve itself which is fine the market will move when it wants to move not where we want it to move but any continued Correctional pullback is simply only viewed as an opportunity to look for Bearer setups into the 16492 okay so last but not least we have the S P 500 and where are we in the S P 500 well we've looked at the overall backdrop here the FED are going to have to keep their foot on the accelerator of tight monetary policy because headline inflation CPI core CPI as well as what we just looked at core pce and headline pce they're all coming out hotter than expected and they are actually accelerating so the FED is going to continue to tighten monetary policy it's going to continue to be hawkish the currency markets are already showing signs of stress because we're seeing the Euro acting as a safe haven asset versus other currencies and on a one month forward-looking basis the commodity currencies are set for the first time together to start to underperform the rest of the currencies we have things starting to break in the UK where the bank of England had to intervene and it had to do so midweek in order to protect the pension industry from being margin called and starting to melt down and at the same time where is the SPX in all this we are now starting the next leg down in the S P 500 and the leg we are starting in the S P 500 is the first second and we're now starting potentially the third leg down the third leg down in Bear markets is where you tend to see stock market capitulation where you tend to see the fastest and hardest moves before markets begin to bottom so that is it for me for this week guys as always I hope you enjoyed this video and if you did please let me know by liking sharing and subscribing a big thank to everybody who does that on a regular basis and a big thank you to everybody who has subscribed to the channel so far if you enjoyed today's video why not consider joining us during the week where I share my charts as well as the setups that I'm personally looking at trading with members on a daily basis and we also published the scorecards for over 75 markets in different asset classes including Forex stocks bonds and commodities you can find out more about the benefits of GMT membership by clicking the links in the description section below and also in the pinned comment below so thanks for watching the only thing left to say is take care and don't get straight safely
2022-10-06 00:32
