Financial markets weekly overview for June 4 – 8
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 (ESM18)
- Dollar Index (DXY)
- Euro (EURUSD)
- Swiss Franc (USDCHF)
- British Pound (GBPUSD)
- Japanese Yen (USDJPY)
- WTI Crude Oil (CLN18)
- Canadian Dollar (USDCAD)
- Gold (XAUUSD)
- Silver(XAGUSD)
- Australian Dollar (AUDUSD)
- New Zealand Dollar (NZDUSD)
- Russian rouble (USDRUB)
- Conclusions
Trade list for the current week
| Assets | Comments | 25. 05 | 1. 06 |
|---|---|---|---|
| **E-Mini S&P500 (ESM18) | The support level was broken on the Daily timeframe on Tuesday, the trend is bearish now and the correction wave develops. A pullback selling opportunity will appear after the correction completion 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 May 21 - 25. | ||
| ***Dollar Index (DXM18) | The market remains in the uptrend and the correction wave develops. A pullback buying opportunity will appear after the correction completion on the Daily timeframe. Long positions will remain relevant until the market is above the nearest support level on the Daily timeframe, the lows of May 11 - 15. | ||
| ***EUR (E6M18) | The market remains in the downtrend. The correction came to an end last week and the pullback selling opportunity was formed. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of May 31 - June 1. | ||
| **CHF (S6M18) | USDCHF currency pair remains in the downtrend and the impulse wave develops. 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 May 15 - 18. | ||
| **GBP (B6M18) | GBPUSD currency pair remains in the downtrend and the correction wave develops. A pullback selling opportunity will appear after the correction completion 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 May 11 - 15. | ||
| ***JPY (J6M18) | The support level was broken on the Daily timeframe on Tuesday, USDJPY trend is bearish now and the correction wave develops. A pullback selling opportunity will appear after the correction completion 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 May 18 - 23. | ||
| ***WTI (CLN18) | The market remains in the downtrend. Another low was broken on the Daily timeframe last week and the impulse wave develops. 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 May 30 - June 1. | ||
| **CAD (D6M18) | USDCAD currency pair remains in the uptrend. The correction came to an end last week and the pullback buying opportunity was formed. Long positions will remain relevant until the market is above the nearest support level on the Daily timeframe, the lows of May 21 - 23. | ||
| **XAU (GCQ18) | The market remains in the downtrend. The correction came to an end last week and the pullback selling opportunity was formed. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of May 29 - June 1. | ||
| *XAG (SIN18) | The market remains in the downtrend. The correction came to an end last week and the pullback selling opportunity was formed. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of May 24 - 28. | ||
| **AUD (A6M18) | AUDUSD currency pair remains in the uptrend. The correction came to an end last week and the pullback buying opportunity was formed. Long positions will remain relevant until the market is above the nearest support level on the Daily timeframe, the lows of May 29 - 30. | ||
| **NZD (N6M18) | The resistance level was broken on the Daily timeframe on Wednesday, NZDUSD trend is bullish now and the impulse wave develops. A pullback buying opportunity will appear after the correction formation on the Daily timeframe. Long positions will remain relevant until the market is above the nearest support level on the Daily timeframe, the lows of May 29 - 30. | ||
| **RUB (R6M18) | The resistance level was broken on the Daily timeframe on Tuesday, USDRUB trend is bullish now and the correction wave develops. A pullback buying opportunity will appear after the correction completion on the Daily timeframe. Long positions will remain relevant until the market is above the nearest support level on the Daily timeframe, the lows of May 22 - 25. |
| 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 |
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E-Mini S&P500 (ESM18)
The support level was broken on the Daily timeframe on Tuesday, the trend is bearish now and the correction wave develops. A pullback selling opportunity will appear after the correction completion 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 May 21 – 25.
COT indicator decreases. CFTC reports indicate that large speculators go on selling and the professionals’ opinion corresponds to the market technical picture.
E-Mini S&P500 (ESM18). Technical analysis and COT net position indicator.
Dollar Index (DXY)
The market remains in the uptrend and the correction wave develops. A pullback buying opportunity will appear after the correction completion on the Daily timeframe. Long positions will remain relevant until the market is above the nearest support level on the Daily timeframe, the lows of May 11 – 15.
COT indicator increases. CFTC reports indicate that large speculators are buying the dollar, hedgers are selling and the professionals’ opinion corresponds to the Daily trend direction.
Dollar Index (DXY). Technical analysis and COT net position indicator.
Euro (EURUSD)
The market remains in the downtrend. The correction came to an end last week and the pullback selling opportunity was formed. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of May 31 – June 1.
COT indicator decreases. Large speculators go on selling 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 downtrend and the impulse wave develops. 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 May 15 – 18.
COT indicator decreases, large speculators are selling franc 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.
CHFUSD. Technical analysis and COT net position indicator.
British Pound (GBPUSD)
GBPUSD currency pair remains in the downtrend and the correction wave develops. A pullback selling opportunity will appear after the correction completion 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 May 11 – 15.
COT indicator reversed. CFTC reports indicate that large speculators began to buy Pound and 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.
GBPUSD. Technical analysis and COT net position indicator.
Japanese Yen (USDJPY)
The support level was broken on the Daily timeframe on Tuesday, USDJPY trend is bearish now and the correction wave develops. A pullback selling opportunity will appear after the correction completion 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 May 18 – 23.
COT indicator decreases, large speculators are selling Yen 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.
JPYUSD. Technical analysis and COT net position indicator.
WTI Crude Oil (CLN18)
The market remains in the downtrend. Another low was broken on the Daily timeframe last week and the impulse wave develops. 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 May 30 – June 1.
COT net position indicator decreases. Large speculators are selling oil. Professionals’ opinion corresponds to the Daily trend direction.
WTI Crude Oil (CLN18). Technical analysis and COT net position indicator.
Canadian Dollar (USDCAD)
USDCAD currency pair remains in the uptrend. The correction came to an end last week and the pullback buying opportunity was formed. Long positions will remain relevant until the market is above the nearest support level on the Daily timeframe, the lows of May 21 – 23.
COT indicator increases. CFTC reports indicate that large speculators are 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 market remains in the downtrend. The correction came to an end last week and the pullback selling opportunity was formed. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of May 29 – June 1.
COT indicator reversed. Large speculators began to buy gold and the professionals’ opinion doesn’t correspond to the technical picture and it makes sense to reduce the position size when an entry point appears in the trend direction.
Gold (GCQ18). Technical analysis and COT net position indicator.
Silver (XAGUSD)
The market remains in the downtrend. The correction came to an end last week and the pullback selling opportunity was formed. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of May 24 – 28.
COT indicator increases. At the same time, CFTC reports indicate that large speculators are buying and hedgers are selling and the professionals’ opinion doesn’t correspond to the technical picture and it makes sense to reduce the position size when an entry point appears in the trend direction.
Silver (SIN18). Technical analysis and COT net position indicator.
Australian Dollar (AUDUSD)
AUDUSD currency pair remains in the uptrend. The correction came to an end last week and the pullback buying opportunity was formed. Long positions will remain relevant until the market is above the nearest support level on the Daily timeframe, the lows of May 29 – 30.
COT net position indicator decreases. Large speculators are selling and hedgers are buying. 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.
AUDUSD. Technical analysis and COT net position indicator.
New Zealand Dollar (NZDUSD)
The resistance level was broken on the Daily timeframe on Wednesday, NZDUSD trend is bullish now and the impulse wave develops. A pullback buying opportunity will appear after the correction formation on the Daily timeframe. Long positions will remain relevant until the market is above the nearest support level on the Daily timeframe, the lows of May 29 – 30.
COT indicator increased but didn’t reverse. CFTC reports indicate that large speculators go on 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.
NZDUSD. Technical analysis and COT net position indicator.
Russian rouble (USDRUB)
The resistance level was broken on the Daily timeframe on Tuesday, USDRUB trend is bullish now and the correction wave develops. A pullback buying opportunity will appear after the correction completion on the Daily timeframe. Long positions will remain relevant until the market is above the nearest support level on the Daily timeframe, the lows of May 22 – 25.
COT indicator increases, large speculators are buying rouble and the professionals’ opinion no longer 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 EURUSD and USDRUB.
In the near future GBPUSD, USDJPY and 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!