<span style="text-decoration: underline;"><strong>1. INTRODUCTION:</strong></span>

What a great week for Fx traders. The last five days gave several great opportunities to make some money, there were really two main market movers that kept me interested.
<ol>
	<li>The JPY relentlessly weakening. For some reason I did not attempt to trade the YEN (JPY) crosses like the EUR/JPY, GBP/JPY, AUD/JPY, NZD/JPY , CAD/JPY and CHF/JPY as I felt that I was chasing the market and as I have indicated before it is not a good trading style or practice to adopt. I entered the USD/JPY on a pullback and hung on in there. Some great income. The move upwards in the YEN (JPY) I thought was coming to a close on several occasions and I did not want to be in the EUR/JPY or GBP/JPY in case we swung back violently. In addition, for my trading in 2013, it is all about risk management so I acted accordingly.</li>
	<li>Super Mario......holy crap.........The guy says there was 100% agreement on not cutting EUR interest rates and we fly upwards taking all the EUR crosses and Cable for the long ride as well. It was the biggest one day move in the EUR/USD for a very, very long time. Recently we have traded on very low ATR's so this move was great...like the good old days. Then like a cherry on top of the "Bakewell Tart" (Google it, if you do not understand) the moves continued yesterday morning (Happy Days)...more $$$ and then I get a sweet trade short on GBP/USD for a 40% position size with 50 pips profit in it to round off the week.....sweet!!</li>
</ol>
I know, we had great China positive news that drove currencies around, in particular the Aussie and Kiwi, and, some interesting CAD news plus confirmation that the UK is really deep in the doo-doo but the YEN and Draghi were centre stage last week, in my opinion. What's next?..............I wish I knew....but it will probably be something with the word "Cliff" in it!!!

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<span style="text-decoration: underline;"><strong>2. THE VIEW FROM MY TRADING DESK:</strong></span>
<p style="text-align: center;"><strong>DO NOT GET CARRIED AWAY...THE EUROZONE IS STILL IN POOR SHAPE...NOTHING IS FIXED YET</strong></p>
I just wanted to try and balance matters this week.

There is so much noise about the markets that following Draghi's press conference last Thursday  as the EUR rallied like a crazy man, or woman possessed to levels not seen for years that I actually for a moment thought that all the Eurozone problems were over. Smack my head against the wall....was I dreaming, was I half a bottle into Jack Daniels......no these were a few comments out on Twitter......My God, Twitter can be dangerous if you take it's comments verbatim.

For whatever reason and I am still struggling with this mentally... Draghi is talking up the Euro currency - why? What on earth is making the markets react the way they do. The EUR/USD rallied about 2% in the week...incredible. Bond yields are coming down but nothing is fixed. Last month at his press conference Draghi stated that there were conversations about reducing EUR interest rates and the currency got smacked. At Thursdays meeting all was sweet, no rate cut unanimous decision and the EUR/USD and all the cross currencies rose like a Salmon in B.C. leaping and jumping over rapids 6 feet in the air dodging "Grizzlies" on the way back upstream to it's spawning grounds....incredible. Draghi is screwing with the export capabilities that are going to be so crucial for growth in the Eurozone. Never mind Germany (they are the driving force of Europe - they can still export) , however  Spain, Greece, Portugal and the rest of the Eurozone still need to grow. They have to start pretty soon or we really will see disparate economic issues in the Eurozone....we will have a depression never mind recession. Even the German's cannot bail out the Eurozone alone and the ECB even with Super Mario at the helm cannot make a Rembrandt out of one of my paintings. The Eurozone needs to have, if it were a person, a good look at itself in the mirror and whilst it's there look in the background and see if it can see "The can" that has been kicked down the road so many times it must be like a tiny spec of dust on the mirror!
<p style="text-align: center;"><strong>UNEMPLOYMENT</strong></p>
<p style="text-align: center;"><strong>CONSUMER CONFIDENCE</strong></p>
<p style="text-align: center;"><strong>GDP</strong></p>
<p style="text-align: center;"><strong>PMi STATISTICS </strong></p>
<p style="text-align: center;"><strong>INCOME TAX AND STEALTH TAX RATES</strong></p>
<p style="text-align: center;"><strong> SOCIAL WELFARE COSTS &amp;  SPIRALING COSTS WITH GOVERNMENT BENEFIT SCHEMES</strong></p>
<p style="text-align: center;"><strong>AUSTERITY MEASURES versus GROWTH </strong></p>
<p style="text-align: left;">These areas highlighted above are just a few of the problems still on the table for the Eurozone politicians to work through. They are both social and economic. The politicians and Civil Servants have been working a list similar to this one, probably with a few additional items contained therein for four years now and have made very little progress. Many would argue they are just delaying as there is no vision to actually sort these matters out. My belief is that politicians are not problem solvers they just attribute blame...so with that thought in mind that is why we have "The Can" being continually kicked down the road. Apart from choosing wine for the elaborate dinner menus at the EU summits I cannot think off the top of my head of a major achievement in the Eurozone by politicians in the last six months. Lots of promises......but bugger all action.</p>
<p style="text-align: left;">We have the highest levels of Unemployment ever in the Eurozone since records began, as an area the total is above 11%. This in turn increases social welfare payments and reduces the tax intake. A double or triple whammy depending upon your viewpoint. The solution, is to increase the tax burden on the remainder to make up the shortfall. People then stop buying goods and services as they have reduced disposable income, confidence goes down as hard measures bite...and on it goes around and around.</p>
<p style="text-align: left;">So, until something is actually done that gives the people who live in the Eurozone a positive outlook, do not get carried away with the politicians viewpoints or those of the ECB. They are so out of touch, it is baffling given what is and has been going on.</p>
<p style="text-align: left;">Trade carefully.......bad Eurozone news is ALWAYS a second or two away..............</p>
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<span style="text-decoration: underline;"><strong>3. MY LONGER TERM TRADES:</strong></span>

I have no long-term trades open in my "Long-Term" account. I tried a couple of times last week with the USD/JPY to keep a trade in position but I was stopped out.

But here are my plans, aims, thoughts: -

<span style="text-decoration: underline;">AUD/USD:</span>
I was burned last year persisting with the AUD/USD short and while I believe Aussie news coming through is going to get decidedly worse as we move forward, I do not want to enter a trade until we test the 1.0630 level. I also want to see the China GDP data first before placing my trade. In the past week we had good China data, but the fact that after such good  news that we did not stretch that high and test makes me feel even more certain that the AUD/USD is one my next targets short on a longer-term basis. I just do not want to enter a trade at current levels.  A good  GDP number and we could be off to the races and 1.0630 could be breached, in fact, if we do get blowout numbers my short trade will be dead and buried.

<span style="text-decoration: underline;">GBP/USD:</span>
The UK saw relief from the Olympics "blip" in statistics recently. That is now well gone and the chickens are coming home to roost one by one. News from the UK is basically poor and the fact that Chancellor Osborne is calling very openly for the GBP/USD to be lower than current levels to aid exports etc is more than just interesting. I see 1.5750 as my first short limit target.

Pullbacks with these two currencies next week and I will plunge in. I will tweet entries etc as I enter the trades.

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<span style="text-decoration: underline;"><strong>4. LOOKING INTO NEXT WEEK -  THESE ARE THE KEY SUPPORT AND RESISTANCE LEVELS WITH THE USD MAJOR PAIRS:</strong></span>

<strong>EUR/USD: Closing Price 1.3342. </strong>As stated last week we are still in a down sloping channel on the Monthly Chart. Terrific moves towards the latter end of last week, pushing this pair substantially higher. Personally, I feel that 1.3400 will offer a short opportunity as we head into confluences of resistance around 1.3380, then above 1.3400 the next stop is around 1.3455. Support will be back down at 1.3250 then 1.3150.

<a href="https://weeklyfxdrivethru.com/wp-content/uploads/2013/01/EURUSD-MONTHLY-120113.png"><img class="aligncenter size-large wp-image-1378" alt="EURUSD MONTHLY 120113" src="https://weeklyfxdrivethru.com/wp-content/uploads/2013/01/EURUSD-MONTHLY-120113.png" width="660" /></a>

<strong>GBP/USD: Closing Price 1.6135.</strong> This pair is being dragged up by the EUR. The cross-rate effect of EUR/GBP will start to weigh in eventually and I think pressure this pair to the downside. Resistance lies at 1.6200, then 1.6250 if we ever get to those areas. Remember at 1.6300 the UK Chancellor, George Osborne, made his comments about cable being too strong so if the pair does really break higher be careful around this level in particular. Support to the downside rests at 1.6085, then 1.6045 and a big one at 1.6000.

<a href="https://weeklyfxdrivethru.com/wp-content/uploads/2013/01/GBPUSD-240-120113.png"><img class="aligncenter size-large wp-image-1377" alt="GBPUSD 240 120113" src="https://weeklyfxdrivethru.com/wp-content/uploads/2013/01/GBPUSD-240-120113.png" width="660" /></a>

<strong>AUD/USD: Closing Price 1.0534.</strong> Bugger....this pair is heading lower too fast for my liking. From a personal perspective I want a re-test of 1.0630 so I can take a short trade. Will we get there...who knows? The range to play with the Aussie is 1.0500 to 1.0630.

<a href="https://weeklyfxdrivethru.com/wp-content/uploads/2013/01/AUDUSD-DAILY-120113.png"><img class="aligncenter size-large wp-image-1379" alt="AUDUSD DAILY 120113" src="https://weeklyfxdrivethru.com/wp-content/uploads/2013/01/AUDUSD-DAILY-120113.png" width="660" /></a>

<strong>NZD/USD: Closing Price 0.8358.</strong> This pair at the back of my mind I call the "Doomsday" pair. Another financial crash and I short this pair like crazy, and I mean crazy. I see 0.6500 in another crash situation. I am not however predicting or calling for a financial crash, let me just make myself clear on that point. I do however believe in my own mind that this pair is so far over-valued it's day is going to come and I hope I have my fingers ready on my trading computer when that day comes. I know, it is what it is and all that jazz but the Kiwi economy is not in that good a shape, why is it so high? Taking my emotion to one side for a minute, the levels to watch with this pair are; resistance 0.8375, then 0.8400. Short side support lies initially at 0.8300 down to 0.8240.

<strong>USD/JPY: Closing Price 89.16.</strong> Is this pair ever going to pullback? Holy Mother of God, its rise (JPY weakness) is relentless.....will it ever stop. The simple truth (As Al Gore would say....) is that there is quite a bit more it can go to. On the Monthly Charts this pair is playing out an inverted "Head and Shoulder" pattern, from which, the measured move could take take it as high at 92.50 to 93.00. That's quite a move from where we are currently. It does not need to stop it can just keep going. Technical traders are saying over and over again that RSI (Relative Strength Indicator) is grossly over-bought, in fact it looks like it's the highest it's been on this pair for over 10 years. Logically, one would expect a pullback. But when did logic ever work in the day-to-day Forex market? Support should be good at around 88.60, maybe not a bad place to try and get long. I want 84.00....yeah, I know dream on..... Topside in the near term has to be huge at 90.00, then for me the inverted "Head and Shoulder" pattern plays out to completion. I read earlier this week that banks are stating 100.00 and I also read 110.00 as 2013-4 goals for this pair. Get the Jack and Diets ready!!

<strong>USD/CHF: Closing Price 0.9133.</strong> Lost money on this pair this week trying to eek out a nice long trade-off 0.9200 support...crashed and burned on that one!! It's really all round numbers for me with this pair. Support 0.9100 then 0.9000 and resistance at 0.9200 then 0.9300.

<strong>USD/CAD: Closing Price 0.9846.</strong> I actually made money off the "Loonie" last week. Two quick fire trades on a news event...happy days. Support beckons at 0.9800 and then 0.9755. Would I just love to get long sub 0.9750 or what!!! Topside resistance comes in at 0.9880 and then 0.9920.

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<span style="text-decoration: underline;"><strong>5. MAJOR NEWS EVENTS THIS WEEK THAT INTEREST ME:</strong></span>

Looking at The Forex Factory not much "Red" news this week of real interest to me.

TUESDAY: GBP - CPi and the BOE inflation letter should be interesting.

WEDNESDAY: AUD - Employment Numbers and Rate.

THURSDAY: CNY - GDP.

FRIDAY: GBP - Retail Sales.

(Given that my target currencies looking forward are GBP and AUD these news events will either confirm or pour water over my thoughts).

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<span style="text-decoration: underline;"><strong>6. CLOSING THOUGHTS AND COMMENTS:</strong></span>

On the face of things it looks like this week could be a slower week. However, do not forget the numpties in Washington are doing their best to f**k up the U.S. economy so be on guard for sound-bytes and ridiculous quotes based upon the party divide. These things can pull the markets around in the blink of an eye and really screw up your trending trades and land you in the crapper.

Therefore, trade a little smaller position size and allow for volatility whilst the U.S. politicians strut their stuff on the TV and Radio stations.

Good luck,

Scott Pickering
The Pip Accumulator
Saturday 12th January 2013.