Tuesday 27 May

So far, I haven't had enough conviction to place a trade this week.

Weekend news of a delay to Europe tariffs (market positive), plus reports the MOF in Japan are considering curbing the rise in Japanese yields (JPY bearish), has put my recent switch to a 'underlying risk off bias' to the test.

Due to Mondays low liquidity (memorial day, UK bank holiday) I opted not trade.

There was certainly a JPY short opportunity during Tuesday's Asian session or European session. But I wasn't at the charts, and now, JPY weakness is perhaps a little stretched.

As things stand, the USD and commodity currencies are reacting in positive correlation with tariff news. And an inverse correlation with the US 10 year (yields down, USD JPY up is very odd see).

All the while, the S&P is a slow moving beacon of positivity.

Whilst my preference for 'risk on' trades has returned, I'm waiting for a stop loss I feel comfortable with, all the while, aware that any positivity is walking a tightrope and a wave of 'risk off sentiment' could return at any moment.

Although the overall risk environment remains in control, AUD CPI data and RBNZ rate decision could have a bearing on the short term direction of AUD and NZD.

It's times like these where not losing money is more important than making money. And staying patient and waiting until you feel extra confident in a trade is never a bad idea.

Please feel free to offer thoughts or ask questions, your experiences may differ from mine: johnelfedforexblog@gmail.com