Wednesday, November 3, 2010

EURJPY—hovering at high

Yesterday's evening star on the hourly chart didn't pan out (or perhaps hasn't yet panned out) as the low was only 112.83 before it rose to a high of 113.64, so far today. I'm still long from 112.00. It looks more as though yesterday's chop was a small zigzag correction with leg C at 1.618 that of A (within three pips). The hammer at the low should hold as support. However, as one can see from the hourly chart, this could have been part of a bigger ABC correction with leg C still to come. The high this morning is very close to yesterday's high before the correction (113.48). Whatever—this chop must stop and the pair needs to push above 113.79 into the 114 area today to justify a bullish outlook. On the daily flag (not shown) one can see a bullish flag that would project nice higher prices.

Resistance is at 113.79, 114.66/79, 115.69 and 116.67 (fib confluence). Should it falter, it could correct back to 112.00 or 111.53. Below that support is at 107.92.

Here's the hourly chart:

© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.

My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.

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