Financial markets weekly overview for February 12 — 18
We make up a weekly medium-term trade list based on CFTC reports and technical analysis.
The overview provides a description of the technical condition of the market on the most popular financial instruments, as well as information on the large speculators’ actions according to the last COT reports and the previous period.
If you want to use CFTC reports in your trading practice, you should understand that for an objective assessment of the situation it’s not enough to know the data of the last report. The dynamic is more important, in other words, comparing the statistics of large speculators’ actions in the current period with the previous one, so we mention both values.
Key topics
- Trade list for the current week
- E-Mini S&P500 (ESH18)
- Dollar Index (DXY)
- Euro (EURUSD)
- Swiss Franc (USDCHF)
- British Pound (GBPUSD)
- Japanese Yen (USDJPY)
- WTI Crude Oil (CLH18)
- Canadian Dollar (USDCAD)
- Gold (XAUUSD)
- Silver(XAGUSD)
- Australian Dollar (AUDUSD)
- New Zealand Dollar (NZDUSD)
- Russian rouble (USDRUB)
- Conclusions
Trade list for the current week
| Asset | Comments | 12. 02 | 18. 02 |
|---|---|---|---|
| **E-Mini S&P500 (ESH18) | The support level was broken on the Daily timeframe on Monday, the trend is bearish now. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. Short positions will remain relevant until the price is below the resistance level, the highs of January 26. | ||
| **Dollar Index (DXH18) | The American dollar remains in the medium-term bear trend and the correction develops on the Daily timeframe. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of January 17 - 19. A pullback selling opportunity from this level will most likely appear within next week or it will be broken, the trend will change and a breakout buying opportunity will be formed. | ||
| ***EUR (E6H18) | The support level was broken on the Daily timeframe on Wednesday, the trend is bearish now. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of February 1 - 2. | ||
| **CHF (S6H18) | USDCHF currency pair remains in the medium-term bear trend and the correction wave develops. USDCHF short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of February 7 - 8. A pullback selling opportunity from this level will most likely appear within next week or it will be broken, the trend will change and a breakout buying opportunity will be formed. | ||
| ***GBP (B6H18) | The support level was broken on the Daily timeframe on Monday, the trend is bearish now. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of February 1 - 2. | ||
| **JPY (J6H18) | USDJPY currency pair remains in the bear trend on the Daily timeframe and the impulse wave develops. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. USDJPY short positions will remain relevant until the market is below the resistance level, the highs of February 2 - 5. | ||
| **WTI (CLH18) | The support level was broken on the Daily timeframe on Wednesday, the trend is bearish now. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of February 1 - 2. | ||
| **CAD (D6H18) | The resistance level was broken on the Daily timeframe on Wednesday, USDCAD trend is bullish now. A pullback buying opportunity will appear after the correction formation on the Daily timeframe. USDCAD long positions will remain relevant until the market is above the nearest support level on the Daily timeframe, the lows of February 1 - 2. | ||
| ***XAU (GCG18) | The support level was broken on the Daily timeframe on Tuesday, the trend is bearish now. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of February 1 - 2. | ||
| ***XAG (SIH18) | The silver market remains in the medium-term bear trend and the impulse wave develops on the Daily timeframe. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. Short positions will remain relevant until the market is below the resistance level, the highs of January 31 - February 1. | ||
| **AUD (A6H18) | The support level was broken on the Daily timeframe on Thursday, the trend is bearish now. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. Short positions will remain relevant until the market is below the resistance level on the Daily timeframe, the highs of January 26 - 30. | ||
| **NZD (N6H18) | The support level was broken on the Daily timeframe on Wednesday, the trend is bearish now. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. Short positions will remain relevant until the market is below the resistance level, the highs of February 6 - 7. | ||
| **RUB (R6H18) | The resistance level was broken on the Daily timeframe on Monday, USDRUB currency pair is in the uptrend now. A pullback buying opportunity will appear after the correction formation on the Daily timeframe. USDRUB long positions will remain relevant until the market is above the support level, the lows of February 1 - 2. |
| The notation that determines the quality of possible trades during the new week are profit potential, the risk-reward ratio, the opinion of major market players, other factors: | |
| **** | Excellent |
| *** | Good |
| ** | Ordinary |
| * | Uninteresting (sideways trends, etc.) |
| The notation that determines the change in the opinion of large speculators, the direction of COT net position indicator in the reporting and prior periods are: | |
| large speculators are buying the asset specified in the first column | |
| large speculators are selling the asset specified in the first column | |
| the green color of the arrows means that the Daily trend direction corresponds to the opinion of large speculators | |
| the blue color of the arrows means that the Daily trend direction doesn’t correspond to the opinion of large speculators |
Trade list in a graphical format is available here.
If you want to get more information on the pullback trading tactics and other aspects of trading in the market, watch the «Horizontal levels in trading» video course.
E-Mini S&P500 (ESH18)
The support level was broken on the Daily timeframe on Monday, the trend is bearish now. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. Short positions will remain relevant until the price is below the resistance level, the highs of January 26.
At the same time CFTC reports indicate that large speculators go on buying and the professionals’ opinion no longer corresponds to the technical picture and it makes sense to reduce the position size when an entry point appears in the trend direction.
E-Mini S&P500 (ESH18). Technical analysis and COT net position indicator.
Dollar Index (DXY)
The American dollar remains in the medium-term bear trend and the correction develops on the Daily timeframe. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of January 17 – 19. A pullback selling opportunity from this level will most likely appear within next week or it will be broken, the trend will change and a breakout buying opportunity will be formed.
CFTC reports indicate that large speculators began to buy dollar, hedgers are selling and the professionals’ opinion doesn’t correspond to the Daily trend direction and it makes sense to reduce the position size when an entry point appears in the trend direction.
Dollar Index (DXY). Technical analysis and COT net position indicator.
Euro (EURUSD)
The support level was broken on the Daily timeframe on Wednesday, the trend is bearish now. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of February 1 – 2.
COT indicator reversed, large speculators began to sell Euro and the professionals’ opinion corresponds to the market technical picture.
EURUSD. Technical analysis and COT net position indicator.
Swiss Franc (USDCHF)
USDCHF currency pair remains in the medium-term bear trend and the correction wave develops. USDCHF short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of February 7 – 8. A pullback selling opportunity from this level will most likely appear within next week or it will be broken, the trend will change and a breakout buying opportunity will be formed.
COT indicator increases, large speculators go on buying franc and the professionals’ opinion corresponds to the Daily trend direction.
CHFUSD. Technical analysis and COT net position indicator.
British Pound (GBPUSD)
The support level was broken on the Daily timeframe on Monday, the trend is bearish now. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of February 1 – 2.
COT indicator reversed. CFTC reports indicate that large speculators began to sell Pound and hedgers are buying and the professionals’ opinion corresponds to the Daily trend direction.
GBPUSD. Technical analysis and COT net position indicator.
Japanese Yen (USDJPY)
USDJPY currency pair remains in the bear trend on the Daily timeframe and the impulse wave develops. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. USDJPY short positions will remain relevant until the market is below the resistance level, the highs of February 2 – 5.
COT indicator increases, large speculators go on buying Yen and the professionals’ opinion corresponds to the Daily trend direction.
JPYUSD. Technical analysis and COT net position indicator.
WTI Crude Oil (CLH18)
The support level was broken on the Daily timeframe on Wednesday, the trend is bearish now. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of February 1 – 2.
COT net position indicator increases. Professionals’ opinion doesn’t correspond to the Daily trend direction and it makes sense to reduce the position size when an entry point appears in the trend direction.
WTI Crude Oil (CLH18). Technical analysis and COT net position indicator.
Canadian Dollar (USDCAD)
The resistance level was broken on the Daily timeframe on Wednesday, USDCAD trend is bullish now. A pullback buying opportunity will appear after the correction formation on the Daily timeframe. USDCAD long positions will remain relevant until the market is above the nearest support level on the Daily timeframe, the lows of February 1 – 2.
CFTC reports indicate that large speculators go on buying the Canadian dollar and hedgers are selling and the professionals’ opinion doesn’t correspond to the market technical picture and it makes sense to reduce the position size when an entry point appears in the trend direction.
CADUSD. Technical analysis and COT net position indicator.
Gold (XAUUSD)
The support level was broken on the Daily timeframe on Tuesday, the trend is bearish now. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of February 1 – 2.
COT indicator reversed, large speculators began to sell gold and the professionals’ opinion corresponds to the technical picture.
Gold (GCJ18). Technical analysis and COT net position indicator.
Silver (XAGUSD)
The silver market remains in the medium-term bear trend and the impulse wave develops on the Daily timeframe. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. Short positions will remain relevant until the market is below the resistance level, the highs of January 31 – February 1.
At the same time CFTC reports indicate that large speculators go on selling and hedgers are buying. Professionals’ opinion corresponds to the technical picture.
Silver (SIH18). Technical analysis and COT net position indicator.
Australian Dollar (AUDUSD)
The support level was broken on the Daily timeframe on Thursday, the trend is bearish now. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. Short positions will remain relevant until the market is below the resistance level on the Daily timeframe, the highs of January 26 – 30.
COT net position indicator increases. Large speculators are buying and hedgers are selling. Professionals’ opinion no longer corresponds to the Daily trend direction and it makes sense to reduce the position size when an entry point appears in the trend direction.
AUDUSD. Technical analysis and COT net position indicator.
New Zealand Dollar (NZDUSD)
The support level was broken on the Daily timeframe on Wednesday, the trend is bearish now. A pullback selling opportunity will appear after the correction formation on the Daily timeframe. Short positions will remain relevant until the market is below the resistance level, the highs of February 6 – 7.
CFTC reports indicate that large speculators go on buying and the professionals’ opinion doesn’t correspond to the technical picture now.
NZDUSD. Technical analysis and COT net position indicator.
Russian rouble (USDRUB)
The resistance level was broken on the Daily timeframe on Monday, USDRUB currency pair is in the uptrend now. A pullback buying opportunity will appear after the correction formation on the Daily timeframe. USDRUB long positions will remain relevant until the market is above the support level, the lows of February 1 – 2.
COT indicator decreases along with the market and large speculators go on selling rouble and the professionals’ opinion corresponds to the Daily trend direction.
RUBUSD. Technical analysis and COT net position indicator.
Conclusions
In terms of medium-term trading, financial instruments with the correction close to completion on the Daily timeframe and with potentially the most promising risk-reward ratio are GBPAUD, EURCAD.
In the near future EURUSD, GBPUSD, NZDUSD can become noteworthy depending on the market correction depth.
Other financial instruments in the trade list may be also interesting, but in these markets pullback signals on the Daily timeframe are likely to occur no earlier than a week.
More information on the topic:
- The role of support and resistance levels in the trading plan
- Trading tactics. Breakout trading and pullback trading
- How to use CFTC reports in trading. General concepts
- How to use CFTC reports in trading. The logic of large speculators
Good luck in trading!