Gold Silver and four JPY trades all hit Target

EURJPY, Daily                 

Macron takes on Le Pen in 2nd round of French election. Macron was declared the winner of the first round of the presidential election with 23.8% of the votes, he will now take on Le Pen, who is second with 21.5% of the votes, in the second round of May 7. The conservative candidate Fillon is third with 19.9% and leftist Melenchon in fourth place with 19.6%. For once surveys were proved right then and the shooting in Paris last week doesn’t seem to have changed much. With the other candidates now backing Macron in the second round, and surveys always showing that he would beat Le Pen in a direct vote, by a wide margin, markets and Draghi can relax a bit, even if the threat of Frexit will only be fully banned after Macron is in office. French bond and stock markets, however, are likely to celebrate Macron’s victory today.

The EUR has surged amid although off highs EURUSD is still showing a 1.2% gain on the day and EURJPY a 2.4% advance (more below). Stock markets in Asia rallied, and the risk-on theme drove the yen to underperform, in accordance with its usual inverse correlative relationship with global stock market direction. USDJPY clocked a 13-day high at 110.63, up from Friday’s closing level at 109.05. The star performer EURJPY rallied to a four-week high at 120.36, well up on Friday’s closing levels just under 117.00.

On Friday (April 21) I wrote The increased risk appetite that has been evident this week which prompted the short JPY positions yesterday were added to on the close last night,  I went short on Gold and Silver and  long on the NZDJPY.


XAUUSD; Entry was taken at last nights close at 1280.00, target is the 14 period DATR at 1268. The 1295 level this week has not been breached and the fractal high suggests further downside, RSI remains strong at 66 but slopes down from the overbought high at 75 on Monday.  The parabolic SAR remains positive and the longer term trend also remains positive. A break of the psychological 1300 level will invalidate this position.  – The target was hit post French Election Risk On mood as Gold move over $19.00 from $1284.00 on Friday down to $1265.46  and through our $1268 target level.


Also on Friday we went short SilverThe less volatile, popular and liquid XAGUSD also prompted an entry last night.  A short position was entered at $18.00 with a target at the 14 DATR, $17.68.  Silver has already breached the 20 day moving average and technically looks more bearish than gold as it completes a five day down move. A break of the $18.75 area would reverse this position. Silver also gapped on open this morning to as low as $17.62 and through our $17.68 target netting over 320 pips.


The final JPY position (On Friday)  – a LONG trade in the NZDJPY at 76.62, target for the move is a breach of the 20 day moving average and into the congestion zone of the 14 DATR at 77.33. A beak below the recent low at 75.60 would negate this position.

On Thursday (April 20) “Yen running out of steam it seems”  had initiated the Risk On move with three SHORT JPY trades.  EURJPY and CHFJPY have both hit Targets 1 and 2 and GBP JPY has hit Target 1.


The net gain of the six trades from Thursday and Friday was 2001 pips.


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Stuart Cowell

Senior Market Analyst


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