How do you like “Trumponomics”? Last week was like an earthquake in markets after Trump announced increasing of tariffs on Chinese products from 10% to 25%. However, I have to admit till the end of the week this noise began to fade.
Some traders believe tariffs are already priced in, others think more pressure on China will lead to a deal. Well, its normal that reaction on same repeating fundamental becomes weaker. But who knows what Trump can do next? I would say that double caution is required now. Besides, I am not sure if China is going to answer or not. Trump’s tariffs are bad for US markets but worse for the rest of the world and in the weeks ahead, central bankers will express their frustrations as data softens. China already took action to protect its market with state fund buying stocks. Is it a hint they are not going for a deal? – It’s tough to say. Only time will show.
Not much has changed since my last EUR/USD forecast as expected pair moved slowly. I have to say this madness is not done yet. I believe we will see more choppiness and possibly even retest of recent lows before going 1.13xx. I will be honest with you – I hate this price action. Swing traders have to wait for 1.13xx to short or under 1.1100 to buy. Scalpers have to be very careful; trading between mentioned zones is going to be difficult. I prefer scalping Gold instead of EUR. It’s what I did last week to gain some profits for managed accounts.
Wish you all profitable week!
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