07 November Probability Studies – NFP Today

by Johan Kriek (jkriek@fxinstructor.com)

Notes:

- BoE and ECB slashed interest rates with 150bps and 50bps respectively yesterday

- US NFP today will be very significant. Employment rate is expected to increase to 6.3%

Probability Studies:

The ECB cut rates with 50bps and price started to trend lower very slowly after the initial reaction. The direction of highest probability is still bearish as long as price stays within the ranges of the bearish 60minute trend. A bearish stoch cross will place the EUR in a suitable bearish trading condition

Still bullish. I know the range of the 60minute trend is a bit large but this still reflects the most active cycle within the underlying current trend according to the probability study technique. A bullish cross on the 1 hour stoch will place the CHF in a suitable bullish trading condition

Risk aversion is back (moderately I have to say) and therefore the bearish probability. Unfortunately the no trade zone here will only evolve in a bearish trading condition if the stoch cross bearish and confirms it

No Trade Zone, bearish probability. The 60minute trend is still intact though.. Also, we can see a serious Head and Shoulders continuation pattern on the higher time frames:

Here we can see how the neckline has been violated already. The target of this pattern is all the way to around 1.46 figure. It seems that price just came back to test the violated neckline (now resistance) to confirm the break out. It looks like we going to get ample shorting opportunities today on this one

The AUD is bearish as well. The previous bullish 60minute trend has been violated to the downside and we even got lower significant peaks to identify the new bearish 60minute trend. A bearish cross on the 1 hour stochastic will plunge this one in a bearish trading condition once again..

I hope you have a great trading day today and start to your weekend. Amidst all the volatility we have seen during this week the probabilities still prevailed and it always a good thing to limit risky trades by using the direction of highest probability as a trading context

Have a good one!

Johan Kriek