2019 Quarter 1 Technical Overview of Major Currency Pairs

In my years of trend trading, this 1st quarter of 2019 has been quite challenging. Price has either been chopping around or has had wild swings and therefore my long-term systems haven’t been generating reliable signal. I switched to my short-term trading system and cut down size in order to take advantage of the swings, but also signals from the short term systems haven’t been forthcoming. Good but not great.
I will illustrate using charts. (Apologies, images may be blurry working to fix that)
PS* when I talk about systems: short-term systems use daily price data while long-term systems use weekly price data to generate signals.

EURUSD where everyone likes pilling in has literally been terrible since Nov last year
forgot to say by signal I mean a breakout above the volatility channel which is usually indicative of change in direction i.e from a non-trending state to a trending state.

GBPUSD where all the hullabaloo and guessing is. Only saw a Breakout in January but there was no follow through,only wild swings within the range. Short-term system came in handy.

USDCAD Had two breakouts and no follow through. Wild swings all over the place meaning short term system candidate. But as we can see ,this pair has not been a good candidate for long-term system because since 2017 price has just been ‘hugging’ the volatility bands.

USDCHF Had a breakout in Feb but no follow through, only a wild swing

AUDUSD: Three words to describe price action here-Chop action chop. Directionless.

NZDUSD: one attempted breakout but didn’t change direction.

USDJPY: One breakout but no follow through. This pair has been trading in wild swings. Using the short term system has been ideal. Upon careful observation one can also see that the moving averages have been flat. No trend trader wants to trade in an environment with flat Moving Averages.

Anyway this kind of behavior will determine whether one has the psychological make up/mindset of a trader.This behavior of price has been prevalent in other cross pairs within the same time period.Patience and risk management has been tested and continues to be tested.

It has been really an excellent learning moment for everyone including veterans and those on demo. Also, for veterans it has been a period of implementing tight and strict risk controls. For predictors, it has been a period of making lots of guesses (equivalent to a coin toss prediction ) and finally for Gamblers and martingale-rs, it has been a period of blowing up accounts.


Price Action Analysis done by Denis Mwenga.


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