AUD - Christmas is coming early!
Australian Dollar pairs are providing the early Christmas presents and the best end to 2020 we could wish for.
I, Jonny, have been holding an AUDJPY long trade since 20 November 2020, managing it according to my plan, as explained and shown in the subsequent six Market Updates, currently running over 6% profit. I'm targeting a large daily wave three run, and this week we had a strong close above the negative daily and weekly resistance at 78.0, that price was previously decelerating at.
This week presented two textbook entries on AUDCHF long. These trades were on our main watch list and covered in full on Monday's Market Update. The second entry and scale in position presented itself 90 minutes after we covered it in Wednesday's Market Update. After the scale in opportunity was given, the price quickly pushed into substantial profits.
I, Jonny, caught the original entry on 9 December and scaled in on the 10th, and am currently running over 6% profit on this pair where we now sit at previous daily highs. I have locked in small profits and will now wait to see if we can break through this daily resistance. Depending on your style of trading, you may have taken profits at these recent daily highs and would have closed the week out sitting pretty. Shout out to everyone in the TMC Club who caught this great opportunity!
We expect the AUD to continue to strengthen after seeing significant daily and weekly closes; however, we could start the week off with some pullbacks after the recent bullish momentum to retest previous resistance as support.
A huge amount of tech companies have made their stock market debut in the last two quarters of 2020. There were many eyes on the IPO of meal delivery company, DoorDash, on Wednesday. DoorDash soared on its first day of Wall Street dealings, seeing an 80%+ increase and giving it a valuation of over $70 billion.
Another giant, Airbnb, had its IPO the following day, Thursday stealing the show away from DoorDash. Last quarter Airbnb shocked the market by posting a profitable quarter, recording a $219 million profit. Although this was not expected by most as the pandemic continues to negatively affect the travel industry, Airbnb doesn't have the traditional costs you'd associate with hotels. The individual property owners will bear the main impact.
Airbnb raised $3.5 billion from its IPO, valuing the company at a colossal $47 billion compared to its April 2020 valuation of $18 billion. The IPO price was set at $68 per share; however, it opened at $146 per share on its first day of trading. After seeing an initial surge to print a high of $165, the price closed out the week sat around $140 per share.
This shows confidence in the company and investor's confidence in the recovery of the travel industry on the back of the vaccine news.
Due to the confidence we saw this week in Airbnb, our focus is looking at competitors that may look undervalued, TripAdvisor, Booking.com, Expedia, to name a few. From a technical analysis perspective, the cleanest opportunity in our eyes is TripAdvisor. We have recently seen a convincing breakout on the daily timeframe and now await a pullback to our confluence area, around $26, to look for bullish opportunities.
What are we watching?
Usually, at this time of the year, markets typically calm down, volume lowers as we head into the holiday period. 2020 unsurprisingly seems different as we are still seeing tremendous opportunities developing over all markets.
BITCOIN is still sitting at those all-time high levels it printed on 1 December. We have a mixed view of what will happen next as the daily tells a different story to the intraday timeframes. The daily chart appears to be forming a triangle pattern, typically a pattern we see before a reversal. The intradays have had a bullish breakout, so next week we should get a clear indication of whether another bullish wave is ready to start or if a pullback is coming before any more bullish momentum.
US DOLLAR, as we have covered in the last couple of weeks, price broke significant support on the USDollar index. We are still awaiting a pullback to retest this previous support as resistance before continuing this bearish momentum. Most USD pairs are decelerating at significant support/resistance levels, and we will have our eyes on them this week for quick pullback plays before the Dollar weakness continues.
EQUITIES remain at all-time highs but continue to decelerate on daily timeframes, and some major indices have broken down on the lower time frames. We will be looking over the coming week for short equity plays but being picky as some industries continue to flourish.
TMC CLUB - TMC's first baby!
We want to give a massive congratulations to the lovely couple (both TMC Traders), Kendall and Shanda Matieshin! Last week they welcomed to the world their baby boy, Layne Micah. We wish nothing but love and happiness for all three of you as you start your lives as a family.
We recently posted a full interview with Shanda, where she talks about her trading journey, shares advice, next goals, and much more. Make sure to check out the full interview here.
What's happening this week?
Monday, Dec 14, 2020 @ 1pm PT
Market Update - lead by Jonny Godfrey
Tuesday, Dec 15, 2020 @ 1pm PT
Chronicles LIVE - lead by Irek Piekarski
*TMC Diamond access required
Wednesday, Dec 16, 2020 @ 1pm PT
Market Update - lead by Jonny Godfrey
Friday, Dec 18, 2020 @ 1pm PT
Insights - lead by Irek Piekarski
All the best for the week ahead and we'll see you in the club!
Jonny Godfrey & the TMC Team
PS. If you're a current member of TMC Diamond, make sure to catch up on the final Coaching Call of 2020: Becoming Legends. This session with Irek ran for 2.5 hours and was focused on peak performance + trader mindset, in preparation for 2021!