USD CPI goes against market expectations. Big cleanout of short USD positions. AUD employment today.

Hi there, traders. Now, just a quick recap after the US CPI numbers, right? The numbers totally got the market on the wrong side of the equation. And what I mean by that is everything was geared up towards lower numbers. We had lower employment numbers. A few of the other numbers have been coming in weak. And then all of a sudden, we get a 0.1% increase in inflation from the forecast. And that is enough to really throw the markets into a bit of a spin, right? The CPI numbers, excluding food and energy, also up by 1%. Now, what's that done for us? Well, as I said, this is a real old school clean out. The markets, I was looking at Euro, looking for an opportunity to get long. And this is where the trend lines really come into play. See how Euro stalled, whereas Sterling had already sort of broken above. The Aussie had done a good job to get up above 70 the figure. Now, what happens here, the market is just anticipating. They're very long dollars, so they're selling dollars. Everything's going up. Then all of a sudden, you get the numbers, and it's a complete clean out. Now, see these moves here, right? Sterling, flush out to the downside, Aussie. These are instruments where traders were loaded up. that's why you're seeing such a big clean out. And don't think there's a nice price action on that first move down. There'll be hardly anything transacting. So if you thought it would be an easy trade to get into on the downside, the charts can be a little bit misleading. All right. So that's where we are, right? And this is just a clean out here. Traders probably would have been trying to get out here under, especially under 132, right? Get out of the positions in sterling on the aussie you've got the flush out to the stop loss, stop loss is triggered on the top side through the course of the european asian european day you get the stop loss break through the first uh support line then the second and that then it's higher this is like a triple whammy complete flush out okay so what it does is it resets the market we have to sort of give it a a little bit of time, the sentiment you have to understand is extremely clear at this point, right? Strong dollar is the theme right at the moment. So we can use that sentiment to start trading now. And this is the advantage of actually waiting for the numbers to come through because there's no change here. You see how these things have nosedived and now they're coming back? Well, they're coming back to levels where we could be selling sterling. Can we be selling Aussie here? Well, it doesn't line up. This is where your technicals come into play. You could definitely be selling Euro, right, because it's coming back to that resistance level. Kiwi, well, you're probably adjusting the trend line to the new high we had and then going from there. So what do we do? Well, sit back and relax. This is the key part of actually being patient with the numbers because now what comes out from here, we've got US dollar sentiment in the market. Now, today we have Aussie employment numbers. Now, this is the thing, right? We've got a strong dollar environment. These numbers come out really weak. Well, Aussie's going to just fall away to the downside, nice and breezy. This is where the trade for the Aussie comes in. Now, if these Aussie numbers come out really strong, and it has to be significantly stronger, like the employment change has to be much bigger than 20, right? And the unemployment rate would need to be lower, right i don't know if we're going to see these but that would see a stronger aussie right and the aussies in the position at the moment where it will react uh against the dollar anyway right you're seeing this move here uh this is as i said it's a complete chop up the uh so it could really go anywhere the smarter play let's just take the u.s dollar out of it right because you know what the u.s interest rate yields have come back a bit um but we have got a risk off profile higher interest rate expectations in the US means lower indices. It means lower dollar block and a stronger US dollar, right? That's what we're seeing at the moment. So we can use that sentiment to trade today. Now with the Aussie numbers, okay, check out the crosses. Aussie's outperforming, right? There's a higher, well, perceived interest rate sort of move on the Aussie. If we come back into the interest rate tracker, right, have a look here around what's going on. the Fed is still on hold. There's no major change. This was a 0.1% increase. It's not much. It's just the way the market was actually set before the numbers. That's why we're getting the dramatic move. So not a lot has changed in the US. If anything, the yields are lower. What it tells me is that the whole clean out here could be a blessing. We start to get stronger numbers here across the board, then we've got something to work with, right? So that's where it is. It's a bit of a tricky one, right? Because a lot of traders want to get in on the trade on the time of the release. But I can tell you after a long time and the way, especially since Trump's been in power, the banks are starved of good trending markets. So they jump into these things so aggressively and they can actually get towelled up, right? So this move from say 132.70, see how it spike to the top side as well as to the downside, that's happening close to instantly. And there's no joy in that. So don't think you've missed out. In fact, if you've actually just watched the numbers, you're in a position now to really sort of gear things up. I'd be adjusting the trend lines to the current levels and then starting to anticipate the next couple of moves. And the best thing is the crosses well they're going to be the ones in play especially with the aussie today and then you got the uh in the uk manufacturing production numbers these are these are things where we can use the live signals this is where we can actually just sit back let the signals roll through you've got sentiment on the majors you know it doesn't get easier telling people to wait for after the cpi numbers is quite hard because i know people want to get in and start smashing it up. But what happens is generally, unless it's a nice trending move and we've got trend lines in play, the only thing getting smashed up is your trading account, right? And I've had a bunch of traders, I've had three or four traders say to me, listen, yeah, on my account, there was a mistake on trade size, no stop losses, all these sorts of things. Those are errors where if you're in a bank, they just walk you out and say okay you can lie to yourself but we know what happens here in the market a mistake is a mistake and it's your career right you guys are lucky because a mistake is just a mistake for that trade maybe it puts a dent in your account but you're still alive learn from the situation look for the next US CPI numbers redraw your trend lines and get ready for good trading conditions, because that is exactly what we've got now after these US CPI numbers. So from here, it's quite simple. We've got strong US dollar sentiment. Get on the calendar, have a look what's coming out, and you'll see where the key numbers are. As I was just saying, industrial production numbers out of the UK, Aussie employment numbers. I don't think the Aussie employment numbers are an easy number to manage because there's four or five variables. Once again, let the number come out, see how it matches up with what we've got, and then you're in a good position to start trading. All right? If you're not sure what to trade, click on the symbols affected. Look at what happens if it's a stronger number or a weaker number, right? The Aussie, I mean, you've got lots of Aussie crosses. That's where I'll be sort of putting my cash at the moment because the US dollar, well, it's a little bit problematic with everything else that's going on. This is the main headline that's going around the world at the moment. US inflation heats up in September, Fed rate hike this month back on the table. Now, that's a load of crap, right? They're not raising rates after that, but that's what the media will do. Get everything into a frenzy. What you got to do is understand where you sit, where the currencies sit, get your technical charts, and particularly your daily charts, give you the answer as to what is really going on, okay? And this one move, like check out the dollar. It is still outperforming everything, right? So to me, looking at the daily, like you look at the hourly charts, and I'm thinking, oh, yeah, yeah, great. This is a good clean out, maybe go back up. Or you're like, wow, I don't know what to do here. And that's actually probably a clearer question or answer. and you come back to the daily charts and you're having a look there and you're like, wow, sterling's under pressure, euro's under pressure, Aussie's under pressure, Kiwi under pressure, dollar CAD's still up, the beast dollar yen is up, dollar Swiss. Like, you know what? If anything, there's no change in the overall trend. The US dollar is going up at this stage and that's what we've got to be trading with. If those hourly charts start lining up with that downtrend, then that's where the cash is. So I'd be looking, if you're looking to trade the majors, right, you've got to be looking to get long dollars on the next bounce in Euro, Sterling, Aussie, Kiwi, everything, really, right? And that sort of may seem, if it seems a bit weird, come back to your crosses and actually make it easier, right? Focus on the intricate details of the cross currencies and let the momentum, the normal flow of the markets kick in. All right, bit of a mouthful there. anyway i hope that makes sense if it doesn't ask a question get on the discord let me know let's just chew the fat work out where the direction is what's going on that's that's how you do it as a team right all right guys have a good one all the best cheerio