Weekly review.

Week starting Monday 26 February: The USD started the week relatively strong, as it looked like the higher for longer narrative was happy to co-exist with higher stocks. The NZD struggled in particular following the RBNZ, a hawkish tone was expected, but NZD bulls were disappointed with what was deemed 'a dovish hold' and a NZD short would have been a good trade.

The other noticeable mover was JPY, as we once again had fun and games from the BOJ. Firstly with comments suggesting a rate hike is imminent which boosted the JPY. Only for more comments later in the week toning down the possibility. And the JPY strength subsequently reversed. It appears the upcoming wage price negotiations in Japan will be of significant importance. And we may soon get a date for a rate hike, be it March, April or June. But the longer the BOJ kick the can down the road, the less likely a hike becomes.

All in all, it was a relatively subdued week in terms of volitility, which was put down to month end flows. But this did change on Friday when soft ISM data kick started March with some bad news is good news data. Which created a short USD opportunity. And if ISM services PMI comes in soft on Monday, that weakness could continue.

Results for week:

Trade 1: AUD JPY -1

Trade 2: AUD USD -1

Trade 3: AUD USD +1.3

Total = -0.7%

Total since start of blog= +18% (risking 1% per trade)

Feel free to email any questions: johnelfedforexblog@gmail.com