Forex Weekly Report 05-10-2019

Hello, again my friends! Very happy to write for you all again! This report is not about analyzing every single currency pair, I don’t want to deliver more of the same. “This week EURUSD this, GBPUSD that…” Well, this is not the idea! I want to bring information that can turn into profit, MONEY!  There are tons of websites making shallow analyses of every currency and we are not here to waste time! So let’s go to the business.



This is is tricky but the BoJ is likely to set to bring further easing attempts – possibly rate cuts to help steepen Japan’s yield curve, as we all know rate cuts are stocks positive. Investors are forced to take risks to increase return, and in this particular case, they have to, because Japan has negative yields.

We also see this week a possible de-escalation of risk-off scenario what can prop USDJPY UP! Nikkei and USDJPY are positively correlated, as you can see in the chart below:

The Nikkei  COT data  is not at extremes but we have things to consider:

  1. Big speculators are net Short
  2. They added to Short

Ok how this is good? Well, few people now that markets were not made to speculators, but to Commercials and the former has an interesting behave, they trade against the trend, and the reason for this is they are not interested(not completely true) in profit from markets, but rather hedge costs, future payments and so on. So it’s very rare you see Commercials buying in an uptrend, but this time(it’s different?) looks to me speculators are adding to losers and commercials have trapped them.

The COT data is gathered till Tuesday and published on Friday, which makes me believe these speculators were betting in more bad numbers for the USA on Friday, at proves wrong.  We already saw price reacting from a daily demand zone, so I think this move will accelerate next week squeezing more shorts.

How do I play this Leo?

You can adopt three behaves

  1. Conservative
  2. Participative
  3. Aggressive

This is how you should place your orders:




Which one I am taking? This will be discussed inside the chatroom.


Ok Leo, do you want me to buy something that is already at a supply zone? That’s exactly what I am telling you to do, and why? Well mainly because big speculators, aka “smart money” just turn net long at this!

Ok, so I just go long at the market?  Not so fast, There’s a big supply zone one weekly and price will react from that point. So you can adopt two behaves:

  1. Conservative
  2. Aggressive

You will wait for the breakout of the supply zone and enter at the pullback, like this:


Yes, you will take at market, try to work your order as these markets do not have a lot of liquidity or you can get a big spread and slippage.


From players positioning(COT DATA) there is almost nothing relevant and after all the narratives we saw last week sometimes less is better. So this week I will continue to play safe, the same themes already commented from previous weeks, mainly bullish USD and bearish EUR. So playing demand/supply zones to the right sides is my trading plan for next week. If something new comes to the wire I will make another post.

That’s it my friends! I hope you can make money from this and I wish you a great weekend for you all! Just to remember Tomorrow is the last day of promo prices for chatroom, now are 25 and then 40 on Monday.

Best regards

Leo Hermoso


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