Written by Casey Stubbs — Follow Casey on twitter.
The Eur/Usd is the most traded pair in the forex market because these are two of the most largest economies on the planet and when you put them together it provides a great deal of liquidity and interest. Therefore the largest volume occurs in the Euro and that creates some volatile moves and at times powerful trends.
This week has proven to be a powerful trend indeed and many accounts have been hit because people have been caught by surprise. I personally hope that none of you got caught in the Euro bullish onslaught as quoted by @Xiphos_Trading on Twitter that occurred this week and if you would have been reading this blog you would have seen that I pointed a potential turn here.
The month January can many times be an indicator as to how the entire year ahead as shown by The Disciplined Trader in a very useful video on his blog might help you come up with some trading ideas, I like Normans advice in the video to stay disciplined.
I want to thank everyone for the participation in my blog posts and I encourage you all to leave a comment below as to what your thoughts on the market are and also if these posts have been helpful.
The Euro/Usd Weekly chart is still bullish and we have had a nice run. I am not going to make any predictions this week except to say that we are still in a stron bullish move and I recommend trading with the trend so at this point I am going to be buying all significant pullbacks until I see that pattern fail and then I will think about doing something different.
Trade Idea of the week:
If you have been following the Canadian economy of late you will find that during the global crisis happening in much of the world Canada has been prospering and they have reduced debt and grown the economy. Read this article about the Canadian economy as reported by the Pittsburgh Tribune this Sunday. On one hand Canada is prospering and on the other hand Europe and the United States are in Global Crisis. I don’t even have to post any links about the downfall of those economies because of the headlines are everywhere, but just in case you are not on planet earth.
Here’s a report that talks about the current condition of Europe and the United States:
Summary and Trade Plan:
The Canadian economy is good, Europe and U.S. is bad, so how should we trade? We have an incredible setup forming right now with the Eur/Cad. The rebound in the Euro has also brought a nice bounce in the Eur/Cad, which in my opinion is a great opportunity for us Forex Traders. This is a good chance to short the bad Euro and take advantage of the strong Cad.
Lets take a look at the charts: Click on the Chart to View Full Size.
This trade could get us another 500 pips and please share it with your friends if you think there is anything good here.
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