This Week’s Economic Calendar
As right now, the dollar is consolidating, the indices is at all-time highs, and currencies are sideways. We have accurately predicted market movements, both higher and lower, with pinpoint accuracy. However, there are times when we need to wait for more information and observe. Now is one such time where the higher timeframe draw on liquidity is not clear and one-sided. As professional money managers practicing strict risk management, it’s not the best time to assume maximum risk. While scalps can still be taken on lower time frames, longer-term projections are not advisable until institutional sponsorship returns to the marketplace being indcated by way of displacement on the daily chart.
Please note that this is not financial advice.*
Monday:
There are no significant news drivers, and considering it’s the start of the week, it emphasizes the importance of patience and managing expectations. The suggested approach is to wait for the 9:30 opening and then focus on identifying the most probable higher time frame draw on liquidity.
Tuesday:
Multiple news drivers scheduled at 9 am and 10 am, which are expected to serve as volatility injections into the markets. Consequently, the day is anticipated to present optimal trading opportunities. It will be ideal fo traders to consider the 10-11 am Silver Bullet for higher probability.
Wednesday:
Red folder news is expected to flood the market throughout the day, starting as early as 8:15 am. These news events will likely serve as volatility injections into the markets. However, it’s important to note that the FOMC (Federal Open Market Committee) meeting in the PM session will likely lead to consolidations in the AM session. Traders are advised to manage their expectations heavily on this day and focus on the 7-8 am macro or after 2:30 if you have the experience to navigate this day.
Thursday:
Highlighted as a day before the Non-Farm Payrolls (NFP) report, and it tends to exhibit high resistance and low probability. It’s advised that traders exercise caution, especially if they are not experienced. On this day, there are medium and red folder news drivers scheduled at 8:30 AM and 10 AM, which are expected to inject volatility into the marketplace. If traders choose to participate on this day, understand it’s a lower probability trading day.
Friday:
Marked by the anticipation of the Non-Farm Payrolls (NFP) numbers. After the release of this high-impact news, there is expected to be a volatility injection into the markets, potentially offering optimal trading opportunities. It’s noted that trading ahead of such high-impact news is not recommended. Instead, traders are advised to wait and observe the liquidity and inefficiencies that unfold post-news. For higher probability setups, consideration can be given to the 10-11 am Silver Bullet or the PM session.
Earnings Spotlight: Major Corporate Reports Unveiling This Week – Key Insights for Investors
The week is expected to be influenced by earnings reports, particularly in large-cap companies. Traders are reminded to anticipate significant price movements surrounding these reports, providing strategic trading opportunities. The heightened volatility during earnings periods can offer smoother trades if approached strategically.
The entire week’s earnings reports are highlighted, with several large-cap institutions scheduled to release their reports. Traders should be prepared for substantial volatility during these events and potential consolidation leading up to the reports.
The Cot Report For The US Dollar
The US dollar is currently experiencing a consolidation phase on the daily time frame. The Commitments of Traders (COT) report, with a specific focus on commercials engaged in hedging activities, reveals that commercials maintain a net long position. This information suggests that commercial entities, such as institutions and hedgers, are holding more long positions than short positions in the market. Traders often analyze COT reports to gain insights into the positioning of different market participants, helping them make informed decisions about market trends.
What does this signify for us as traders? The repeated indication of commercials being net long on the dollar is gradually manifesting on the charts through bullish close candles on the weekly time frame, suggesting a potential shift in market structure. However, the current consolidation on the daily time frame poses challenges in anticipating market direction with certainty. The bullish market structure is in place, but the tight range within the consolidation makes it difficult to determine the immediate market direction.
While the commercials maintain a net long position, exercising caution and waiting for confirmation from the market structure before adjusting your bias is advisable. It’s important to observe whether there is a clear displacement away from the consolidation range to validate the continuation of the bullish trend. Monitoring institutional footprints and being patient for a decisive move out of the consolidation can provide more clarity for traders.
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Stay informed for sound decision-making, and always adhere to strict risk management protocols.
Until our next update, trade wisely.
Happy Trading!
Adora Trading Team
