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Dave Floyd is a professional FX and stock trader based in Bend, OR and the President of Aspen Trading Group. Dave's approach to FX combines technical and fundamental analysis that results in trades that fall into the swing trading time frame of several hours to several days. For a free trial to Dave Floyd's Daily Forex Alerts click here.
Friday's FX Observations
The Dollar Index (DXC) is still attempting to bust through some key resistance at 89.55, a level that has proven to be a real challenge in recent sessions. The PPI and retail sales data, due out at 5:30 AM PDT will likely provide some much needed direction.
The chart below illustrates a trade that we legged into last night, although the trade idea/analysis itself was done around 6 PM PDT. What I believe is useful about this chart is that it identifies a key resistance level, 114.70 but also factors in that the current price action is a bit extended - hence a pull-back is likely.
Under this scenario I chose to break my trade entry into 2 pieces. The chart below will illustrate this.
As of this morning, 5:23 AM PDT, the trade has begun to play out.
EUR/USD:
Look for the 1.2060 level to contain pull-backs; we still see 1.1985 by Monday
USD/CHF:
Solid support at 1.2825 with momentum suggesting a move towards 1.2910 by today/Monday
** the above observations in EUR and CHF were done prior to the PPI and Retail Sales data
As always, feel free to send me your comments and questions.
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