In a recap of the week so far as of 9:10 AM EST:
AUDUSD took a tumble this week, reaching a low of .9804, a lower low than the prior week. It did stay above the weekly 20 EMA which has been holding price dips since September. The rally was capped yesterday at 1.0020. This morning saw another drop, dipping below the daily uptrend line once more. The listless RSI readings that accompanied the rally may have something to do with the decline. Low so far this morning is .9857 from where it's trying to base. The drop took out the remainder of my long for +38 pips. Resistance is at .9900, .9982, 1.0020/56, 1.0183, 1.0214, and 1.0257. Support is at .9804, .9690, .9612 and .9544/32.
EURGBP had a low this week of .8285, only a pip or two below that of the prior week. Currently, the weekly candle looks like it's a piercing candle which would be bullish if it closes near its spike high today of .8499. Resistance above .8500 is strong.
EURJPY bounced from a low of 107.80 on 106.83 on Monday to its high so far this morning of 110.93. That exceeded last week's high. A weekly close there would be bullish. Despite that, though, there's still much weakness in this pair. Assuming the pair is in an ABC correction, a C wave that's 1.618 of the A wave would take price to 111.08. If it can close safely above that, it's possible it could see 114.24/52 up to 115.69 but I think that's unlikely.
EURUSD bounced smartly as well from its low of 1.2874. Fierce resistance is in the 1.3500 area. If the pair manages a clean close above 1.35 then 1.3739/85 is possible. That would make the Euro bulls, who have largely been in retreat, very happy. It's more likely there will be another pullback, slightly below the 1.2874. I kook forward to my weekend analysis on this pair.
GBPJPY dropped to a low of 128.32 this week. And then, in line with the emotional market, marched up to a 131.60 resistance this morning. Should the Guppy clear that, then 133.03 will be formidable. I plan to short.
GBPUSD , from a low of 1.5475, bounced to yesterday's high of 1.5884. It's trying to get back there this morning and the high has been just a few pips below at 1.5876. The price target, if it doesn't falter, is 1.5949.
USDCAD has been struggling all week, not catching much of a ride from the earlier USD strength and dropping to a low of .9849. It tried to pick up some steam this mornng, reaching .9977 but is stumbling again. Next week should be interesting for this pair as there has been low volatility all week.
USDCHF climbed barely above last week's high to .9784 before falling to a low of .9605 this morning. This lined up with yesterday's analysis which put a C wave at 1.618 that of A at .9568 and price support at .9605 and .9587. Additional support is at .9525. It's trying to rally.
USDJPY touched a low of 82.41 this morning, after falling back from resistance at 83.46 on Wednesday. A close below 82.50 this weak will leave the bears in control.
Friday, January 14, 2011
Thursday, January 13, 2011
Lots of emotion
The market is showing very emotional moves this morning. Either you believe something has fundamentally changed such that currencies such as the Euro are now strong or else you have to believe this is something of a kneejerk reaction. We'll know soon enough.
USDCHF—retreating
The dip down to .9617 was below the short-term uptrend line but RSI has not yet broken below its uptrend line. I closed my long from .9490 at .9679 (+189 pips). I have one long left from .9338.
As I pointed out in my post on the Cable, the Swissy and Cable look as though they're finally diverging again (they don't usually move in correlation as they have been in the short-term lately).
The Swissy was battling fierce resistance in a zone to .9860. Tuesday's chart showed five waves, so this is likely a correction. The fifth wave at a high of .9784 was just beyond the projected .9760.
If this is an ABC correction, then A's length was 121 pips (.9783 to .9662 yesterday) and B ended at .9764. This implies a zigzag correction with C now projected at 1.618 that of A for .9568. That lines up with price support at .9605 and .9587. Let's see how it behaves there. When pairs rise quickly as this one did, there's not a lot of support built up so if it drops below .9587, there's minor support at .9525 but then there's not a lot to prevent it falling back to the gloomy .9300 lows.
© 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.
As I pointed out in my post on the Cable, the Swissy and Cable look as though they're finally diverging again (they don't usually move in correlation as they have been in the short-term lately).
The Swissy was battling fierce resistance in a zone to .9860. Tuesday's chart showed five waves, so this is likely a correction. The fifth wave at a high of .9784 was just beyond the projected .9760.
If this is an ABC correction, then A's length was 121 pips (.9783 to .9662 yesterday) and B ended at .9764. This implies a zigzag correction with C now projected at 1.618 that of A for .9568. That lines up with price support at .9605 and .9587. Let's see how it behaves there. When pairs rise quickly as this one did, there's not a lot of support built up so if it drops below .9587, there's minor support at .9525 but then there's not a lot to prevent it falling back to the gloomy .9300 lows.
© 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—good move up
Aussie reached a high of 1.0020 this morning. I'm still long from .9859.
It's near resistance here at 1.0030/56 but it isn't showing weakness just yet. In its ebullient way, it just may be resuming its uptrend. Next resistance is at 1.0183, 1.0214, and 1.0257. Support is at .9936/13, .9821, .9690, .9612 and .9544/32.
© 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.
It's near resistance here at 1.0030/56 but it isn't showing weakness just yet. In its ebullient way, it just may be resuming its uptrend. Next resistance is at 1.0183, 1.0214, and 1.0257. Support is at .9936/13, .9821, .9690, .9612 and .9544/32.
© 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—nice rally
My short was taken out in the rally yesterday for +90 pips.
It has sailed through resistance since then, easily overcoming resistance at 1.3225 and it has pushed above 1.3300 this morning. Trichet is speaking and he is such a calming influence, right?
Overall weakness is still present so at some point there's another short trade. Let's see if it can close above 1.33 at the end of the day in the NorAm market. If it can do so, expect a retest of 1.3434 or possibly 1.3498 (but I don't think the latter is likely).
Support is at 1.3220, 1.3145, 1.3089, 1.2962, and 1.2806.
© 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.
It has sailed through resistance since then, easily overcoming resistance at 1.3225 and it has pushed above 1.3300 this morning. Trichet is speaking and he is such a calming influence, right?
Overall weakness is still present so at some point there's another short trade. Let's see if it can close above 1.33 at the end of the day in the NorAm market. If it can do so, expect a retest of 1.3434 or possibly 1.3498 (but I don't think the latter is likely).
Support is at 1.3220, 1.3145, 1.3089, 1.2962, and 1.2806.
© 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.
EURJPY—C leg correction
EURJPY has touched a high of 110.24, its prior high. It looks very strong as it surged through the fibo confluence and resistance at 108.95 and 109.50. If this is a correction then the C leg will reach 111.09 (assuming C is 1.618 A's length).
It's possible the pair will retest 109.00 or 109.50. Depending on how strong it looks on the hourly chart, I'll probably buy. Below that support is at 108.00, 107.86, 106.83, and 106.24.
© 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.
It's possible the pair will retest 109.00 or 109.50. Depending on how strong it looks on the hourly chart, I'll probably buy. Below that support is at 108.00, 107.86, 106.83, and 106.24.
© 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—rallied past resistance
I'm still long from 1.5419 and 1.5602 and added another position early this morning at 1.5750 (stop is already at breakeven).
Now that the Cable has gotten above the strong resistance at 1.5651 and had a three-hour close above 1.5740, there's little in the way of a move to 1.5912 and possibly 1.6000. Just in case this doesn't happen, I took partial profits on my position from 1.5419 at +430 pips.
Support is 1.5740 and 1.5650. I will most likely add positions on a pullback.
Also, it looks as though the Swissy and Cable are finally diverging as I wrote about yesterday. This is more normal.
© 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.
Now that the Cable has gotten above the strong resistance at 1.5651 and had a three-hour close above 1.5740, there's little in the way of a move to 1.5912 and possibly 1.6000. Just in case this doesn't happen, I took partial profits on my position from 1.5419 at +430 pips.
Support is 1.5740 and 1.5650. I will most likely add positions on a pullback.
Also, it looks as though the Swissy and Cable are finally diverging as I wrote about yesterday. This is more normal.
© 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, January 12, 2011
GBPUSD—rally
I'm still long from 1.5419 and I added another position yesterday at 1.5602 as the pair looked stronger as the morning went on. Cable has reached a high of 1.5682 yesterday and it's struggling with that now. While it has climbed above the top of the daily triangle, there is still the strong resistance at this level that I wrote about yesterday. The resistance consists of a weekly channel resistance price and the weekly 20 EMA of 1.5651 as well as some fibos.
Yesterday, I showed the triangle on the daily chart, which it is now slightly above. I've drawn a blue line on the three-hour chart below to show that the pair could be in an upward rectangle (possible bear flag especially since momentum is negatively diverging from price). The low of this would be 1.5451. I'm not sure the triangle is dead. The rectangle is just another way of looking at the price movement. However, a sustained close above 1.5680 would be significant. Additional resistance is at 1.5710/40. After that there's little significant resistance until 1.5912.
Below 1.5451 is support at 1.5345, 1.5297 and 1.5210 (double top—1.5604 and the trough is 1.5407).
As I wrote about the Swissy, it's unusual for both the USDCHF and GBPUSD to be trending upwards together. I expect the two will diverge at some point, possibly later today.
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.
Yesterday, I showed the triangle on the daily chart, which it is now slightly above. I've drawn a blue line on the three-hour chart below to show that the pair could be in an upward rectangle (possible bear flag especially since momentum is negatively diverging from price). The low of this would be 1.5451. I'm not sure the triangle is dead. The rectangle is just another way of looking at the price movement. However, a sustained close above 1.5680 would be significant. Additional resistance is at 1.5710/40. After that there's little significant resistance until 1.5912.
Below 1.5451 is support at 1.5345, 1.5297 and 1.5210 (double top—1.5604 and the trough is 1.5407).
As I wrote about the Swissy, it's unusual for both the USDCHF and GBPUSD to be trending upwards together. I expect the two will diverge at some point, possibly later today.
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.
EURJPY—correcting
The remainder of my short from 109.27 was profit-stopped out at 108.20 (+107 pips).
The high so far has been 108.73. This is just above 50% of the most recent move down from 110.24 to 106.83. I wrote yesterday about price targets ranging from 108.46 (if this C leg on the three-hour chart was .618 of A), 109.46 if C equals A, and 111.09 if C is 1.618 A's length. There is fibo confluence at 108.95. My plan is to reestablish a short positon as this should prove to be good resistance up to 109. However, the pair is exhibiting good momentum at this point and price and time are fairly well in synch so I'm waiting to see some signs of weakness.
Support is a zone from 107.86 to 106.83, and 106.24 (price lows, polarity, fib confluence). Below that is 105.83 (September lows) and 103.81.
© 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 high so far has been 108.73. This is just above 50% of the most recent move down from 110.24 to 106.83. I wrote yesterday about price targets ranging from 108.46 (if this C leg on the three-hour chart was .618 of A), 109.46 if C equals A, and 111.09 if C is 1.618 A's length. There is fibo confluence at 108.95. My plan is to reestablish a short positon as this should prove to be good resistance up to 109. However, the pair is exhibiting good momentum at this point and price and time are fairly well in synch so I'm waiting to see some signs of weakness.
Support is a zone from 107.86 to 106.83, and 106.24 (price lows, polarity, fib confluence). Below that is 105.83 (September lows) and 103.81.
© 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—rallied
I'm still short from 1.3222.
After reaching a high of 1.3046 overnight and then falling back, Euro has just poked its head to 1.3048. My first price target yesterday was 1.3040 to 1.3088. There's fib confluence here (.382 of the move from 1.3824 to 1.2874 and .50 of the move from 1.1876 to 1.4283) and it's near a broken Point & Figure 45° line. Additional resistance is found at 1.3125/54 (this is the small triangle Euro broke below so a retest would make sense), 1.3225 and 1.3300.
I'll be looking to add short positions (or take out new ones if my profit stop is hit). However, I'll need to see signs of faltering—another failure from this price point would be interesting evidence.
Support is at 1.2962, 1.2806(.618 of 11893 to 14282)/2795, 1.2655, and 1.2588.
© 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.
After reaching a high of 1.3046 overnight and then falling back, Euro has just poked its head to 1.3048. My first price target yesterday was 1.3040 to 1.3088. There's fib confluence here (.382 of the move from 1.3824 to 1.2874 and .50 of the move from 1.1876 to 1.4283) and it's near a broken Point & Figure 45° line. Additional resistance is found at 1.3125/54 (this is the small triangle Euro broke below so a retest would make sense), 1.3225 and 1.3300.
I'll be looking to add short positions (or take out new ones if my profit stop is hit). However, I'll need to see signs of faltering—another failure from this price point would be interesting evidence.
Support is at 1.2962, 1.2806(.618 of 11893 to 14282)/2795, 1.2655, and 1.2588.
© 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—bounced
Aussie did bounce yesterday in line with my analysis. I bought yesterday morning at .9859 and my stop is now just better than breakeven. Price is again above the daily uptrend line so it's possible the move below was a fake-out, especially given good RSI readings (never dropped below the low 40s during the price decline).
The pair has reached a high of .9933 so far today so it's just under strong resistance at .9982. Additional resistance is at 1.0030/56, 1.0183 and 1.0214. Support is at .9821, .9690, .9612 and .9544/32.
© 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 has reached a high of .9933 so far today so it's just under strong resistance at .9982. Additional resistance is at 1.0030/56, 1.0183 and 1.0214. Support is at .9821, .9690, .9612 and .9544/32.
© 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.
USDCHF—still fighting
I'm still long from .9338 and .9490 but am considering lightening up by perhaps closing the .9490 long. Yesterday's high was .9784 and it has since pulled back to a low of .9691 this morning. On the 30-minute chart the low formed a hammer candle. This is a support level, albeit not a particularly strong one, so let's see if it can hold. Both the Swissy and Cable have been rising and as their correlation is usually negative on a daily or longer basis. Therefore, one will probably continue in its direction while the other falls.
As I wrote yesterday, the Swissy is in a strong resistance zone continuing up through .9860. In the five waves I traced out on yesterday's chart, wave five equaled wave one at .9688. Given it's almost pulled back to this, there could be an ABC correction beginning or wave five isn't over. (Elliott Wave is so NOT definitive which is why you can't trade it). Another way using EW theory to predict the end of wave five is to take the amount between wave one and three (407 pips from 9301 to 9708), multiply it by .382 and use that to project wave five from the bottom of wave four (.9605). That price target is .9760. In any case, one can see why there's resistance here.
Support is at .9605/00 and .9562/41.
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.
As I wrote yesterday, the Swissy is in a strong resistance zone continuing up through .9860. In the five waves I traced out on yesterday's chart, wave five equaled wave one at .9688. Given it's almost pulled back to this, there could be an ABC correction beginning or wave five isn't over. (Elliott Wave is so NOT definitive which is why you can't trade it). Another way using EW theory to predict the end of wave five is to take the amount between wave one and three (407 pips from 9301 to 9708), multiply it by .382 and use that to project wave five from the bottom of wave four (.9605). That price target is .9760. In any case, one can see why there's resistance here.
Support is at .9605/00 and .9562/41.
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.
Tuesday, January 11, 2011
USDCHF—bullish hourly candle
I'm still long from .9338 and .949. I closed the trade from .9652 at .9679 (+27 pips), not really expecting it to get through resistance. The candle that just closed on the hourly chart (not shown) is very bullish and was a break above the consolidation zone (.9605 to .9727). It now looks ready to challenge .9800 and possibly .9860 which is the top of this rather fierce resistance zone. Note the rectangle consolidation range is 122 pips and the target from that is .9849. It has also broken above a speed line so conceivably it could return to 1.0066 before having real problems. However, the USD index has moved up in five waves so a correction may be forthcoming in the Swissy as well. I've traced out five waves on the three-hour chart below where, if wave five equals one, the target will be .9688. That's a lot of resistance lining up in the upper 96 range.
Support is at .9600 and .9562/41.
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.
Support is at .9600 and .9562/41.
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.
GBPUSD—pounding at resistance
I'm still long from 1.5419. However, I'm thinking of closing my long or at least lightening it up significantly.
The pair hasn't been able to climb above 1.5604 which is the top of the triangle. This is also near a weekly channel resistance price and the weekly 20 EMA of 1.5651 as well as near some fibos. A drop back to 1.5445 (the triangle bottom) would proceed another move up. Since symmetrical triangles are often a continuation move (and Elliott triangles allegedly break in the same direction as the prevailing trend), then eventually the pair should break down from this triangle to some very attractive targets. Below the triangle is support at 1.5345 and 1.5297.
If the pair should break above 1.5651, additional resistance is at 1.5710/40.
I'm posting the daily chart below which shows the old bull flag I drew some time back. It's back around this breakout point from that flag so one could see some upside potential if this were to take off. That move would bring it in line with a C wave on the monthly chart. However it seems unlikely to happen as the pair has broken below two uptrend lines. There's also an asymmetrical, confirmed (1.5485) head and shoulders pattern with a price target of 1.4670.
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 hasn't been able to climb above 1.5604 which is the top of the triangle. This is also near a weekly channel resistance price and the weekly 20 EMA of 1.5651 as well as near some fibos. A drop back to 1.5445 (the triangle bottom) would proceed another move up. Since symmetrical triangles are often a continuation move (and Elliott triangles allegedly break in the same direction as the prevailing trend), then eventually the pair should break down from this triangle to some very attractive targets. Below the triangle is support at 1.5345 and 1.5297.
If the pair should break above 1.5651, additional resistance is at 1.5710/40.
I'm posting the daily chart below which shows the old bull flag I drew some time back. It's back around this breakout point from that flag so one could see some upside potential if this were to take off. That move would bring it in line with a C wave on the monthly chart. However it seems unlikely to happen as the pair has broken below two uptrend lines. There's also an asymmetrical, confirmed (1.5485) head and shoulders pattern with a price target of 1.4670.
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.
EURUSD—ready to rally
I'm still short from 1.3222.
Yesterday's low was 1.2874. In reaching this low, one can make an argument for a five-wave decline. If this isi true then prices would move up. A rally would make sense given the positive divergence on the daily chart. A logical target would be 1.3040 to 1.3088. There's fib confluence here (.382 of the move from 1.3824 to 1.2874 and .50 of the move from 1.1876 to 1.4283) and it's near a broken Point & Figure 45° line. Additional resistance is found at 1.3125/54 (this is the small triangle Euro broke below so a retest would make sense), 1.3225 and 1.3300. I would re-establish short positions at any of those if my profit stop is hit on my existing short position.
Support is at 1.2806/2795, 1.2655, and 1.2588.
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.
Yesterday's low was 1.2874. In reaching this low, one can make an argument for a five-wave decline. If this isi true then prices would move up. A rally would make sense given the positive divergence on the daily chart. A logical target would be 1.3040 to 1.3088. There's fib confluence here (.382 of the move from 1.3824 to 1.2874 and .50 of the move from 1.1876 to 1.4283) and it's near a broken Point & Figure 45° line. Additional resistance is found at 1.3125/54 (this is the small triangle Euro broke below so a retest would make sense), 1.3225 and 1.3300. I would re-establish short positions at any of those if my profit stop is hit on my existing short position.
Support is at 1.2806/2795, 1.2655, and 1.2588.
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.
EURJPY—possible ABC correction
EURJPY has managed to stay above its low of 106.83, near a somewhat obscure fibo and near a round number (which the yen pairs seem to favor). On the daily chart (not shown), there was a harami candle yesterday which hints the market is vacillating. I'm still short from 109.27. I took partial profits at 160 pips just a few minutes ago.
The pair hasn't managed to get above 107.87 in what looks like an ABC correction on the three-hour chart. The A wave of this ran from 107.61 to 110.24 or 263 pips. From the 106.83 low, this means a target of 108.46 if C equals .618 of A, 109.46 if C equals A, and 111.09 if C is 1.618 A's length. I think 108.46 is most likely which is also near fibo confluence of 108.95. I'd probably re-establish a short position there as my profit stop would have been hit on my current short position. As I wrote yesterday, there's a cluster of resistance up to 109.00.
A support zone exists down to 106.24 (price lows, polarity, fib confluence). Below that is 105.83 (September lows) and 103.81.
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.
The pair hasn't managed to get above 107.87 in what looks like an ABC correction on the three-hour chart. The A wave of this ran from 107.61 to 110.24 or 263 pips. From the 106.83 low, this means a target of 108.46 if C equals .618 of A, 109.46 if C equals A, and 111.09 if C is 1.618 A's length. I think 108.46 is most likely which is also near fibo confluence of 108.95. I'd probably re-establish a short position there as my profit stop would have been hit on my current short position. As I wrote yesterday, there's a cluster of resistance up to 109.00.
A support zone exists down to 106.24 (price lows, polarity, fib confluence). Below that is 105.83 (September lows) and 103.81.
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—dropped to support
Last week when I blogged about the Aussie, it was headed down. On Friday I blogged it was targeting support at the uptrend line from June. It broke through that last night. After sinking to a low of .9821, it is currently retesting the broken line at .9883. This is also near a fibo so if the pair can scale these, then that will show some strength.
On the weekly chart (not shown), the pair could be in a C wave where .618 of A would be .9859. It didn't get that far below this. If that is true—big if when talking about Elliott Wave—the next move would be up. On the daily chart (not shown) the RSI hasn't dropped below 41.58 after six days of dropping prices. That, too, is positive. The three-hour chart shows a large bullish engulfing candle overnight. There is also positive divergence although RSI did break below its uptrend line. At .9812, price would be at .618 of the move up from .9537 to 1.0257. It got very close to that with its low of .9821. On the hourly chart, RSI has managed to move out of oversold although it's been largely basing for the last several hours. Finally, the pair is still in an overall uptrend and philosophically one would want to buy dips.
For all of those reasons I bought at .9859. Before entering a trade, the first thing I do is calculate the risk and determine how I will know I am wrong. In this case, it's relatively easy to know. If the pair closes below .9800 (and the first hint will be a dip below .9821), I'd back out and assume AUDUSD will target the next level of support at .9690, .9612 or .9544/32. Another way I'll know I'm wrong is if there are signs are serious faltering as it tries to get above the trend line. This can best detected on shorter-term charts.
Resistance is at .9982 (strong), 1.0030/56, 1.0183 and 1.0214. I think it’s doubtful it will get above there but I still have active price targets that go to 1.0307 and 1.0500 (see the January 3 blog).
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 weekly chart (not shown), the pair could be in a C wave where .618 of A would be .9859. It didn't get that far below this. If that is true—big if when talking about Elliott Wave—the next move would be up. On the daily chart (not shown) the RSI hasn't dropped below 41.58 after six days of dropping prices. That, too, is positive. The three-hour chart shows a large bullish engulfing candle overnight. There is also positive divergence although RSI did break below its uptrend line. At .9812, price would be at .618 of the move up from .9537 to 1.0257. It got very close to that with its low of .9821. On the hourly chart, RSI has managed to move out of oversold although it's been largely basing for the last several hours. Finally, the pair is still in an overall uptrend and philosophically one would want to buy dips.
For all of those reasons I bought at .9859. Before entering a trade, the first thing I do is calculate the risk and determine how I will know I am wrong. In this case, it's relatively easy to know. If the pair closes below .9800 (and the first hint will be a dip below .9821), I'd back out and assume AUDUSD will target the next level of support at .9690, .9612 or .9544/32. Another way I'll know I'm wrong is if there are signs are serious faltering as it tries to get above the trend line. This can best detected on shorter-term charts.
Resistance is at .9982 (strong), 1.0030/56, 1.0183 and 1.0214. I think it’s doubtful it will get above there but I still have active price targets that go to 1.0307 and 1.0500 (see the January 3 blog).
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.
Monday, January 10, 2011
USDCHF—resistance zone
I'm still long from .9338, .9490 and .9652.
After climbing to a high of .9708 Thursday, the Swissy fell back to .9605 before beginning another rally which has brought it to a spike high of .9727 this morning.
The pair is battling a resistance zone. It includes price, polarity (look left to October and December on the daily chart below) and fibos as well as the steep weekly chart downtrend line from June. The zone runs up to .9860 which is where the daily downtrend line is from last August. So let's wait and see how it goes.
Support is at .9605, .9553/48, and .9463/48.
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.
After climbing to a high of .9708 Thursday, the Swissy fell back to .9605 before beginning another rally which has brought it to a spike high of .9727 this morning.
The pair is battling a resistance zone. It includes price, polarity (look left to October and December on the daily chart below) and fibos as well as the steep weekly chart downtrend line from June. The zone runs up to .9860 which is where the daily downtrend line is from last August. So let's wait and see how it goes.
Support is at .9605, .9553/48, and .9463/48.
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—weak
I'm long from 1.5419 and took partial profits at +115 pips today as the pair spiked to 1.5566. After its little rally last week to a high of 1.5646 on Tuesday, the pair is flopping around trying to find some direction. On the monthly chart (not shown), Cable may be in the C wave of an ABC correction which could carry it quite a bit higher into the 1.60's or in the D leg of a symmetrical triangle which might take it down to 1.4578 (this is a monthly basis so don't get too excited) before the final move up to E. Then you'd see a very nice drop.
There is strong resistance at 1.5651 which is the downward channel resistance on the weekly chart as well as the weekly 20 EMA.
Here's the weekly chart. My trades don't show on the longer term charts because I use a different charting package.
© 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.
There is strong resistance at 1.5651 which is the downward channel resistance on the weekly chart as well as the weekly 20 EMA.
Here's the weekly chart. My trades don't show on the longer term charts because I use a different charting package.
© 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—weak
EURUSD touched a low of 1.2874 early this morning. The drop began last Tuesday and on its way down it has broken both the weekly and monthly 10- and 20-EMAs, the 200 daily SMA, psychological support at 1.30 and of course, the price support of 1.2969. It also broke and closed below a symmetrical triangle on the daily chart.
Support is at 1.2806/2795, 1.2655, and 1.2588. The best guess is that Euro will flirt with the 1.20 area in the first quarter of 2011. However, no matter how grim things are for the Euro, this won't happen in a straight line and there will be rallies. I expect any resistance to be capped at 1.3100/28 and plan to add to my short position during rallies.
I'm still short from 1.3222 and took partial profits at +301 pips.
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.
Support is at 1.2806/2795, 1.2655, and 1.2588. The best guess is that Euro will flirt with the 1.20 area in the first quarter of 2011. However, no matter how grim things are for the Euro, this won't happen in a straight line and there will be rallies. I expect any resistance to be capped at 1.3100/28 and plan to add to my short position during rallies.
I'm still short from 1.3222 and took partial profits at +301 pips.
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.
EURJPY—trying to base at support
EURJPY failed to form a base in the low 108 area and dropped further to a low of 106.95 on Friday, near a somewhat obscure fibo and of course a round number (which the yen pairs seem to favor). In trying to base here, it has reached a spike high of 107.68 overnight. However it has since fallen back and we're going to have to see what happens during the NorAm session.
A support zone exists down to 106.24 (price lows, polarity, fib confluence). Below that opens up the possibility of a move down to 103.81. There's a cluster of resistance between 108.00 and 109.00 (price, fibo, confluence). Above that is last week's high of of 110.24.
See last week's blog posts for charts.
© 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.
A support zone exists down to 106.24 (price lows, polarity, fib confluence). Below that opens up the possibility of a move down to 103.81. There's a cluster of resistance between 108.00 and 109.00 (price, fibo, confluence). Above that is last week's high of of 110.24.
See last week's blog posts for charts.
© 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.
USDJPY—resistance
USDJPY had a range last week of 81.73 to 83.21 and was not as volatile as some of the other pairs. It closes, capped by its weekly 20 EMA (curently 83.62). Price touched its high last week on Friday so it's coming into the week with bulls in control.
Note, though, that on the daily chart, Friday's high was an upper shadow on the candle and that's most likely because it's near resistance with the downtrend line from May coming in just pips above it on the daily chart and the weekly 20 EMA which has been roughly capping the pair since last June. The next resistance is .8441/51 (a double top that formed between November and December with confirmation at 82.35 and price target of 80.19). After that, resistance is 85.00, 85.86, 88.04 and and 88.34/56 (a fibo and a longterm downtrend line).
So what could be going on here? There's always a chance of a trend reversal but that's a trifle optimistic at this point. It could be an ABC correction which is seen most clearly on the weekly chart. If so, 83.60 would be the target of the current C wave if C is to be .618A and if the low of B was at 80.94. That's very close to where the pair is. If C were to equal A, the target is 85.25, near the monthly 10 EMA, a speed line on the daily chart, and near a round number. It could also be a bear flag that began with the October low of 80.31. If so, its resistance is near the 85.00 mark. My general plan would be to short at some point but note that I'm already short the EURJPY and the correlation between the two pairs is high. That means it's essentially the same trade as far as risk goes.
The December low was 80.94 so it's possible the pair will bounce in a range between there and 84.00 for a while.
Here's a 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.
Note, though, that on the daily chart, Friday's high was an upper shadow on the candle and that's most likely because it's near resistance with the downtrend line from May coming in just pips above it on the daily chart and the weekly 20 EMA which has been roughly capping the pair since last June. The next resistance is .8441/51 (a double top that formed between November and December with confirmation at 82.35 and price target of 80.19). After that, resistance is 85.00, 85.86, 88.04 and and 88.34/56 (a fibo and a longterm downtrend line).
So what could be going on here? There's always a chance of a trend reversal but that's a trifle optimistic at this point. It could be an ABC correction which is seen most clearly on the weekly chart. If so, 83.60 would be the target of the current C wave if C is to be .618A and if the low of B was at 80.94. That's very close to where the pair is. If C were to equal A, the target is 85.25, near the monthly 10 EMA, a speed line on the daily chart, and near a round number. It could also be a bear flag that began with the October low of 80.31. If so, its resistance is near the 85.00 mark. My general plan would be to short at some point but note that I'm already short the EURJPY and the correlation between the two pairs is high. That means it's essentially the same trade as far as risk goes.
The December low was 80.94 so it's possible the pair will bounce in a range between there and 84.00 for a while.
Here's a 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.
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