From the Desk of Ian Culley @IanCulley
Currency markets refuse to choose a direction.
Up, down, or sideways: None appeal to the major US dollar pairs.
Meanwhile, the US Dollar Index $DXY is catching toward the upper bounds of its yearlong range.
If the dollar continues to rise, these swing trades will break for our targets…
I was monitoring the British pound for a breakdown below the December 2023 lows at approximately 1.25:
Instead of resolving lower, the GBP/USD took the opposite route, breaking above the December 2023 highs.
But those new highs were short-lived as the pound slipped back into its prior range. (Talk about indecisive!)
I like shorting the GBP/USD failed breakout. As long as the pound trades below 1.2766, I’m aiming for last month’s low of 1.2515.
Meanwhile, a failed breakout leads to a fresh breakdown…
The New Zealand dollar is posting a new three-month low today:
Not only is the NZD/USD undercutting a shelf of former lows, but it’s also slipping below last October’s pivot high. Plenty of price memory exists at this polarity zone, creating an excellent level to trade against.
I’m short the New Zealand dollar below 0.6055, targeting 0.59.
The choppy market environment dictates our strategy: tactical swing trades. We’re not looking for monster gains. And we can’t let these trades drain our pockets.
As the legendary trader Larry Williams likes to say, “Ride the horse in the direction it wants to go.”
Currency markets are like a horse yet to choose a path. We must remain patient and methodical until they do.
-Ian
Thanks for reading.
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