Today’s Trades 10.31.2018 USDJPY, AUDUSD, EURGBP, CHFJPY

*Good morning/afternoon everyone!*

Its the last day of October and hopefully it won’t be a spooky day for the financial markets. So far it doesn’t seem the case because Dow futures are pointing to a strong open after yesterday’s 400 point increase in equities. Treasury yields are also up and investors are looking forward to healthy ADP and Chicago PMI reports. However the end of the month always poses a risk to the market because it can cause unexpectedly sharp moves. We’ve seen significant declines in major currencies this month in pairs like the EURUSD, GBPUSD and AUDUSD which are particularly vulnerable to month end short covering and relief rallies. With that in mind, Eurozone, Australian and New Zealand data remain weak with German retail sales growing less than anticipated, Australian CPI missing expectations, New Zealand building permits and activity falling and Chinese PMIs retreating. AUD and NZD are lower today but they are also showing some resilience in early NY trade. Fundamentally and technically however they should continue to move lower. EUR/USD has broken below 1.1350 and could fall to 1.1300 but only if support at 1.1330 is broken. With the Bank of England’s monetary policy announcement and Quarterly Inflation report right around the corner, we expect some short covering in GBP/USD that should put additional pressure on EUR/GBP. The Bank of Japan left interest rates unchanged last night which was no surprise but they lowered their inflation outlook which is bearish for JPY. Canadian GDP numbers are also due this morning and slower growth is anticipated.

*The MAIN THEMES I see today are*

+USD
-EUR
-GBP
-AUD
-JPY

*Trading Biases*

+USD
-EUR, -GBP, -JPY, -AUD, -NZD
mildly -CAD, +CHF

*Today’s Initial Trades*

Here’s the summary --

1. Buy USDJPY at 113.16, Stop at 112.88, Target 113.44
2. Sell AUDUSD at .7084, Stop at .7112, Target .7056
3. Sell EURGBP at .8898, Stop at .8926, Target .8870
4. Sell CHFJPY at 112.52, Stop at 112.80, Target 112.24 v

Swing

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