I don't usually blog on Fridays but I haven't had time to post a lot this week. Instead of the usual blah-blah, I thought it might be helpful to take a look at a long position in the GBPUSD from the point of view of how the trade originated and the ups and downs I rode before it started to pay off for me. I bought at 1.5406 and it's now up over 300 pips. I took some partial profits at +304 pips this morning.
I first started zeroing in on this pair in my August 30th blog where I wrote, "Cable is coiling inside a symmetrical triangle. It's possible it could get as high as 1.6346 before it's over (but this is based on the monthly chart and won't happen immediately if it happens at all). The bottom of the triangle is in the 1.44 area." I went on to write, " In the case of the cable, the longer term monthly trend is down since 2007. However, I may look for longs if the shorter term charts indicate interest in getting to 1.6346, the top of the triangle." So the pair had my interest as a possible long even though the overall trend was down. In fact, I was wondering if we were in a C wave. C waves, as third waves, are often strong.
On September 2 the pair continued to hold my attention. I wrote, "I think there's a chance for another leg up and bought at 1.5358. In case I'm wrong I've already moved the stop to breakeven and took part of the position off the table for +40 pips."
Note how I'm keeping that larger bear trend in mind with a quick move of the stop to breakeven. But I was optimistic even though the "dip to 1.5326 was bearish since it was below the prior week's hammer candle low of 1.5371." But that dip was only slightly below and it was "only.382 of the 1.4228 to 1.5998 move." Clearly I'm interested in being long because as I went on to write, "The fact that this held as support was positive. There's also support beneath here in the form of Fib confluence zones."
I then wrote:
I wrote on Aug. 30th about the monthly symmetrical triangle with a potential of 1.6346 if it ran back up to the top. You could also look at the monthly action as having completed A and B of an ABC correction with C underway. On the daily chart, there's a bull pennant with a potential 672 pips from the breakout point (1.6164). All that's lovely to behold if price moves up but before one starts filling out deposit slips there is significant resistance in the 1.54 to 1.55 range with 10-, 50-, and 200-day SMAs ranging from 1.5428 to 1.5467. The top of the bull pennant is at 1.5480 and 1.5492 was yesterday's high. 1.5598 is the August 26th high.
September 7th found me trying to deal with conflicting signals. I wrote:
What was left of my long stopped out at +10 pips in the move down from 1.5490. It's currently clutching the .382 retracement of the move from 1.4228 to 1.5998….The 50% line is at 1.5113… near the downward sloping channel line and the 100-day simple moving average. If one buys that scenario then shorting a rally or selling a decisive break of 1.53 are the way to go. There is positive divergence on the three-hour chart so a rally may be coming.
I then reminded readers (and myself) again of the " larger monthly picture of a symmetrical triangle whose bottom, up-sloping line is in at 1.4431 and whose upper down-sloping line is at 1.6272. That leaves lots of room for price movement."
On September 9th I wrote that:
Cable is continuing its bull flag on the daily chart and even though there are some conflicting signals I'm trading it that way for now. I made this decision within the larger context of the monthly chart's symmetrical triangle which has the potential for higher prices before it drops down again. The pair broke through some good resistance in the 1.54 to 1.55 area before touching 1.5533. It then retraced to 1.5377, almost 50% of the last leg up of 1.5297 to 1.5533. There it seemed to base, near a more significant .382 retracement.
I reported that I had bought at 1.5433.
That trade didn't pan out. I wrote on September 13th that "My long from last week stopped out at -40 pips." In the blog I went on to say that "last week's low of 1.5297 has held. It's right on its weekly uptrend line and still clinging to the .382 retracement. Bulls would like to see it overtake 1.5533." I noted that if it overcame that price it would make 1.5703 possible" with the "1.5998 August 6th high" next.
I wrote that I had taken another long position at 1.5414 because of the ability to have a tight stop knowing that the stop might be taken out because "the real support is at 1.5297."
That trade stopped at breakeven.
On September 14th I wrote that I was long again from 1.5406. I provided a three-hour chart and noted that the pair had reached the top of that at 1.5515 and that a break through the resistance zone of 1.5535 to 1.5567/84 would mean 1.5703 was possible and after that would mean the August 6th high of 1.5998 was possibly achievable.
That trade is the one I'm in now. It obviously achieved 1.5703 but since that's resistance I wanted to take some profits off the table. But notice how I got there. I had two trades that stopped at or slightly above breakeven. I had one trade that had a 40 pips loss. After those three trades I went long again because there was nothing in the charts that violated my overall perception that support was holding. It's not easy. Nobody likes getting stopped out with no profit or a small loss. It's not easy to buy when the majority of opinion is that that the best course of action is to sell. But that's the nature of trading.
From here we don't really know if the pair will reach 1.5998. I'll do another big analysis over the weekend and see where I go from here. More than likely the pair will hit my profit stop at some point but we'll see.
Friday, September 17, 2010
Thursday, September 16, 2010
AUDUSD—.9457 still caps
I'm still long from .8913. The pair is stalling but it certainly hasn't had much of a retracement with the low since Tuesday's high only .9331. A .382 retracement of the move up from .8770 would be just below .9200 which would be a psychological level and near a prior high of .9176.
On the three-hour chart the pair is trying to break out of a pennant formation. There's a tremendous amount of bullish sentiment out there which is either good or bad depending on how you look at it. I saw one statistic this morning that said overall bullishness for AUDUSD is at 93%. That's very high given that it has already had a good move up. But that's sentiment for you and it is easier for a pair to keep going up if it has already been moving up.
It needs to break above the .9457 high and that's what everyone will be watching. If it does so in a clear and solid fashion, the 2008 high of .9851 is a possibility (but not without some retracement—nothing goes straight up). Look for faltering at .9500. Support is at .9331, .9200, .9185/76, .9092, .9067 and .8911.
Here's the three-hour 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.
On the three-hour chart the pair is trying to break out of a pennant formation. There's a tremendous amount of bullish sentiment out there which is either good or bad depending on how you look at it. I saw one statistic this morning that said overall bullishness for AUDUSD is at 93%. That's very high given that it has already had a good move up. But that's sentiment for you and it is easier for a pair to keep going up if it has already been moving up.
It needs to break above the .9457 high and that's what everyone will be watching. If it does so in a clear and solid fashion, the 2008 high of .9851 is a possibility (but not without some retracement—nothing goes straight up). Look for faltering at .9500. Support is at .9331, .9200, .9185/76, .9092, .9067 and .8911.
Here's the three-hour 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.
EURUSD—rally
In a move that has surprised some, Euro rallied strongly the last couple of days and has reached a high of 1.3109 today. Here it's running into resistance as there are several barriers to it moving higher. This does not mean it can't overcome them. What it means is that probability is on or moving to the side of new short positions but that tight stops are mandatory.
On the weekly chart below you can see it has pushed up to its downtrend line in what looks like a corrective three-wave move. The downtrend line is drawn from the January high of 1.4581. A .382 fib retracement of the move down from 1.5144 to 1.1892 comes in at 1.3134 so this offers resistance as well. An uptrend line from the early June low also comes in around this level so the pair could be retesting that line as resistance.
However, looking at the other side—the potential for more upside—one can see that 50% of the move down from that 1.4581 high is 1.3229. The prior high of 1.3335 is now under threat but it is also a potential resistance level (in fact it would be a very good one). You can also make a case for a wave count of this being wave C (the 1.3335 high being the end of wave A and the 1.2588 being the end of wave B. If that is a true interpretation then this C wave could carry as high 1.35. This interpretation needs a definitive close above 1.32.
Bottom line is that if one does short then one has to be ready to reverse or try again at the higher levels.
Here's the weekly 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.
On the weekly chart below you can see it has pushed up to its downtrend line in what looks like a corrective three-wave move. The downtrend line is drawn from the January high of 1.4581. A .382 fib retracement of the move down from 1.5144 to 1.1892 comes in at 1.3134 so this offers resistance as well. An uptrend line from the early June low also comes in around this level so the pair could be retesting that line as resistance.
However, looking at the other side—the potential for more upside—one can see that 50% of the move down from that 1.4581 high is 1.3229. The prior high of 1.3335 is now under threat but it is also a potential resistance level (in fact it would be a very good one). You can also make a case for a wave count of this being wave C (the 1.3335 high being the end of wave A and the 1.2588 being the end of wave B. If that is a true interpretation then this C wave could carry as high 1.35. This interpretation needs a definitive close above 1.32.
Bottom line is that if one does short then one has to be ready to reverse or try again at the higher levels.
Here's the weekly 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.
Wednesday, September 15, 2010
Tuesday, September 14, 2010
AUDUSD—overtook resistance
The pair finally moved and broke through the .9406 resistance and the price targets .9420/50 from my P&F calculations that I previously blogged about have essentially been achieved. I'm staying long for now but expect some retracement before it continues up, that is if it continues up. The bulls now have the 2008 .9851 high in mind but it's not a sure thing by any means. Even if that's the route, there will be some retracements coming up so people will have a chance to catch the long. .9500 is the next resistance level. Support is at .9362, .9314, .9207/00, .9185/70, .9092, .9067. .8911, and .8872/61.
The weekly chart shows that with the break upwards of the downtrend line the path looks good.
© 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.
The weekly chart shows that with the break upwards of the downtrend line the path looks good.
© 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.
GBPUSD—At top of 3-hour triangle
I'm long from 1.5406 and I just took partial profits of +101 pips. The pair has been is in a symmetrical triangle and just shot up to the top of it, reaching 1.5515. There's quite a bit of resistance from here through 1.5535 to 1.5567/84 (.382 of the 1.5598 to 1.5297 move and the 200 daily SMA). If it can break through this then 1.5703 is possible and then the 1.5998 August 6th high. Here it would find major resistance. Support is at 1.5441, 1.5389/84, 1.5346, 1.5297 (strong), 1.5235, and 1.5132.
Here's the three-hour 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.
Here's the three-hour 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.
AUDUSD—not much change
I'm still long from .8913 and it's still up over 400 pips as this point but there has been little movement since yesterday. It needs to clear .9364 in order to continue its bullish rise. If it does so then .9406/20/50 will be possible. A break below .9221 would open things up for lower lows but the bears haven't been able to pull that off as of yet.
Resistance is at .9364, .9406, . Support is at .9312/00, .9289, .9207/00, .9185/70, .9092, .9067. .8911, and .8872/61.
No chart until something changes.
© 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.
Resistance is at .9364, .9406, . Support is at .9312/00, .9289, .9207/00, .9185/70, .9092, .9067. .8911, and .8872/61.
No chart until something changes.
© 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.
EURUSD—still bearish
Even with the push up to 1.2910, the picture is still bearish for the Euro. It's still shy of last Monday's 1.2919 high. The 1.3335 high was seen by many to be the end of the correction from the 1.5144 to 1.1892 move. As I wrote yesterday, above 1.30 it runs smack into a downtrend line from January of this year. So sellers are hovering about, some selling now and some waiting a bit longer. This makes the lack of real movement since yesterday morning more than understandable. About all we can do right now is wait and see.
Resistance is at 1.2919, 1.3000 and 1.3084 (the January downtrend line). If it does get above 1.3084 then 1.3228/54 are possible. Support is at 1.2794, 1.2676, 1.2644 and 1.2588.
No chart until there's something new to show, i.e. a definitive break above 1.30 or a collapse downwards.
© 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.
Resistance is at 1.2919, 1.3000 and 1.3084 (the January downtrend line). If it does get above 1.3084 then 1.3228/54 are possible. Support is at 1.2794, 1.2676, 1.2644 and 1.2588.
No chart until there's something new to show, i.e. a definitive break above 1.30 or a collapse downwards.
© 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.
Monday, September 13, 2010
EURUSD—a little rally
Euro has pushed up to 1.2843 this morning and seems to be aiming for last Monday's 1.2919 high. Certainly lots of selling would come in if it gets there so longs at this point might not have much of an upside. I plan to be one of the sellers near 1.29. Support is at 1.2794, 1.2676, 1.2644 and 1.2588.
If Euro broke above 1.2919 it would cause the bears to pause and a break above 1.30 would be a psychological victory for the bulls. Above 1.30, though, runs it smack into a downtrend line from January of this year. I think a further down leg is inevitable but we'll see. Trade the chart, not one's opinion.
You can see on the weekly chart that price action is narrowing. Here's the 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.
If Euro broke above 1.2919 it would cause the bears to pause and a break above 1.30 would be a psychological victory for the bulls. Above 1.30, though, runs it smack into a downtrend line from January of this year. I think a further down leg is inevitable but we'll see. Trade the chart, not one's opinion.
You can see on the weekly chart that price action is narrowing. Here's the 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.
AUDUSD—bubbling up
I'm still long from .8913 and this has certainly been a happy trade with it up over 400 pips this morning. I've set my profit-stop 300 pips over the entry price.
The pair touched .9334 this morning. This makes the price target on my 3-hour P&F chart of .9420/50 more likely. On the daily price chart, the top of the channel is at .9489. However the pair is overbought (over 70 on RSI) on the three-hour chart and nudging in and out of it on the one-hour chart so a reaction wouldn't be unexpected. More than likely I'd add to my position, especially if it got near .9207. Bulls are beginning to babble about .9851 but that is not anywhere near a sure thing. There's still a lot of bearishness in the charts and this could all be one big bull trap.
Resistance is at .9364, .9406, . Support is at .9312/00, .9289, .9207/00, .9185/70, .9092, .9067. .8911, and .8872/61.
Here's the daily 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.
The pair touched .9334 this morning. This makes the price target on my 3-hour P&F chart of .9420/50 more likely. On the daily price chart, the top of the channel is at .9489. However the pair is overbought (over 70 on RSI) on the three-hour chart and nudging in and out of it on the one-hour chart so a reaction wouldn't be unexpected. More than likely I'd add to my position, especially if it got near .9207. Bulls are beginning to babble about .9851 but that is not anywhere near a sure thing. There's still a lot of bearishness in the charts and this could all be one big bull trap.
Resistance is at .9364, .9406, . Support is at .9312/00, .9289, .9207/00, .9185/70, .9092, .9067. .8911, and .8872/61.
Here's the daily 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.
GBPUSD—Hanging in barely
My long from last week stopped out at -40 pips.
Since then the pair has held its own and last week's low of 1.5297 has held. It's right on its weekly uptrend line and still clinging to the .382 retracement. Bulls would like to see it overtake 1.5533 at least. That price would start the bears selling so if it overcame it then that would be positive and make 1.5703 possible. If it cleared that as well then the 1.5998 August 6th high is next. As I wrote last week, this price is seen as the end of a corrective move so there would be major resistance here. Support is at 1.5400, 1.5389/77, 1.5346, 1.5297 (strong), 1.5235, and 1.5132. I've bought a small position at 1.5414. The stop can be tight, just below that last completed doji on the hourly chart below. This may be taken out as the real support is at 1.5297 but if it takes it out price may drop to that and rally anyway, giving another chance for a buy or tolling the bell for further drops.
Here's the one-hour 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.
Since then the pair has held its own and last week's low of 1.5297 has held. It's right on its weekly uptrend line and still clinging to the .382 retracement. Bulls would like to see it overtake 1.5533 at least. That price would start the bears selling so if it overcame it then that would be positive and make 1.5703 possible. If it cleared that as well then the 1.5998 August 6th high is next. As I wrote last week, this price is seen as the end of a corrective move so there would be major resistance here. Support is at 1.5400, 1.5389/77, 1.5346, 1.5297 (strong), 1.5235, and 1.5132. I've bought a small position at 1.5414. The stop can be tight, just below that last completed doji on the hourly chart below. This may be taken out as the real support is at 1.5297 but if it takes it out price may drop to that and rally anyway, giving another chance for a buy or tolling the bell for further drops.
Here's the one-hour 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.
GBPJPY—Weekly
Guppy is near its weekly chart uptrend line. Despite the fact the overall picture for this pair looks grim, I'd be surprised if there wasn't a bounce given the more optimistic mood in the markets this morning. I bought at 129.47 with a tight stop below the uptrend line on the weekly chart.
Redrawing the downtrend line (in red on the chart below) from the August 2009 high shows a possible price target of 135.33 This might be overly ambitious given the bearish charts for this pair. More likely is 133.70 the high earlier this month. This is between the daily 50 and 100 SMA of 133.04 and 134.02 respectively so those add a little more strength to the resistance. 134.02 is also the .618 retracement of the last move down (137.79 to 127.92). Sellers will come out there so a short might then be attractive. However if they couldn't overcome the buyers then the previous high of 137.709 would look more attractive. Support is at 129.35, 129.10, and 128.58. A break below the uptrend line needs to find support at 128.58 because below that would indicate the downtrend is resuming with 126.73 in sight. Below that is tohu-bohu with 120.00 first and then 118.83.
Here's the weekly 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.
Redrawing the downtrend line (in red on the chart below) from the August 2009 high shows a possible price target of 135.33 This might be overly ambitious given the bearish charts for this pair. More likely is 133.70 the high earlier this month. This is between the daily 50 and 100 SMA of 133.04 and 134.02 respectively so those add a little more strength to the resistance. 134.02 is also the .618 retracement of the last move down (137.79 to 127.92). Sellers will come out there so a short might then be attractive. However if they couldn't overcome the buyers then the previous high of 137.709 would look more attractive. Support is at 129.35, 129.10, and 128.58. A break below the uptrend line needs to find support at 128.58 because below that would indicate the downtrend is resuming with 126.73 in sight. Below that is tohu-bohu with 120.00 first and then 118.83.
Here's the weekly 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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