Weekly review.

As the week starting Monday 11 March began, I was expecting USD weakness to continue following the higher unemployment and lower wage growth from the NFP data. But that weakness didn't materialise. And in the end actually turned into a resumption of USD strength as the week unfolded, due to once again persistently high inflation. Which now has the market focused on the number of cuts this year. Down to .50 basis points (bp) from .75bp. This re-pricing boosted yields and the USD and caused stocks to have a slightly nervy week.

In other news, wage growth meetings in Japan garnered a lot of attention. And the positive outcome of the negotiations paves the way for the BOJ to end negative interest rates. You would ​have expected the JPY to have strengthened, but oddly it was weak for most of the week. I suspect traders have JPY 'merry go round ​fatigue'. I made a decision fairly early in the week to leave yen until the upcoming meeting has passed. (I'll comment more on ​Monday).

The AUD and NZD had contrasting sentiment, as comments from Australia suggest more rate hikes are a possibility, although the generally negative risk environment curtailed the AUD positivity. Whilst comments from New Zealand suggest cracks are starting to show in the economy. And the NZD particularly suffered, also compounded by the risk environment.

On a personal note, it was a case of staying patient early in the week. A buy stop AUD USD (when I was expecting USD weakness) didn't trigger. I then had to wait until Thursday for a very nice NZD USD trade. And on Friday I was convinced the USD strength was going to continue, only for profit taking to scupper an almost perfect week. But it was nice to get back to winning ways after ​a couple of loosing weeks.

Results for week:

Trade 1: NZD USD +1.5

Trade 2: ​USD CAD -1

Total = +0.5%

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

Please feel free to email any questions: johnelfedforexblog@gmail.com