Weekly Outlook 21/01/2024

This is going to be the fourth week of the month. For the last 3 weeks, we have seen various price actions across my pairs. DXY was in decent growth, while EUR has dropped, GBP was ranging and CAD dropped. To understand what’s happening with the price we should read what the big players were doing. Were these moves supported by the order flow or were they just pullbacks where market makers have been offloading the positions? Let’s find out in the Commitment of Traders reports.

Trading plan Link – Trading Plan Week 4 (notion.so)

Dollar Index

The dollar has topped in the last year October. Since then the DXY is in the slide down. In my opinion, the price will visit the 100 territories soon where there are nice equal lows – liquidity zone. It’s supported fundamentally – The Fed will most likely not be raising the interest rates shortly. More likely they will drop interest rates in the second quarter and that’s what is currently being priced in.

EURUSD

Price has been dropping for the past 3 weeks since it topped in December. We have just dipped into the weekly order block and retested the FVG area again. With the strong rejection on the last Friday. In my opinion, those equal highs around 1.115 have now stopped the loss cluster above from those who shorted the break out of two previous weeks’ lows. And I think the price can go there.

GBPUSD

Pound is in my opinion the strongest currency at the moment. Not only it has very nice price action where order blocks are nicely respected but as well COT data are ultra bullish and clean. On the chart below we can see how to price range for the last 3 weeks has created triple-equal lows just right above the order block from December. Finally, this Wednesday price dipped below those lows and was rejected from this order block. We can see swing low being created.

USDCAD

USDCAD price topped in November when it created a yearly high right into the rejection block. Since then we can see the price moving down. The last 3 weeks’ push-up has been just rejected in the weekly order block. And as on the previous analyses you probably already know what we will be looking for.

 

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