In a recap of the week so far as of 10:15AM EST:
AUDUSD reached 1.0200 this morning after a week that has had higher lows each day this week and mostly higher highs (exception was Wednesday where the high was only slightly below that of Tuesday). During the week, it confirmed the January double bottom (.9804 on 1/11 and .9833 on 1/20) with its break above 1.0077. The price target from this is 1.0350. The daily chart sported a triangle that Aussie broke above as expected. The price target from this is 1.0307. Finally, there was also a bull flag on the daily chart. Price broke above; the target is 1.0378. With the series of clustered targets, it seems likely the pair will make it. I even have price targets beyond 1.0400. However, it's not likely to reach those without some retracement from the 102 range as there's other resistance there. There's currently some negative divergence on the three-hour chart—something to keep an eye on. Support is at 1.0109 and 1.0055 in the short term. A break below .9804 would be bearish and selling would likely take place with the potential to push price down further to .9690, .9612 and .9544/32. However, there'd also be buyers coming at .9804 so it would likely be quite a battle. There are also the two occurrences of bearish candle formations on the weekly chart to keep an eye on. Nevertheless, so far, at least this week, the bulls are firmly in control.
EURGBP has ranged from a high of .8619 this past Monday to this morning's low of .8424 (forming a hammer on the three-hour chart so this is the first support level. Additional support is at .8400, .8332 and .8285. Falling below .8285 would be very negative, likely bringing in more sellers to possibly push price down to .8143 and then .8068. Resistance is at .8582, .8672, .8818 and .8941. Momentum and volatility will hold clues to future price movements.
EURJPY had a corrective week after last week's high of 114.01. Yesterday showed a 182-pip drop and the pair has edged below its 20 daily SMA. Its low this morning is 110.77. Below here is support at 110.32, 109.58 (nice support), 108.71, 107.62 and 106.83. Depending on momentum behavior, this pair might be a good buy in the lower 110 or upper 109 price zone. However, the Euro is not a strong currency right now so caution is necessary. Should it regain its traction, expect resistance at 112.00, 112.88 and 114.01. Beyond that it's likely to move on up to the top of the long-term trading range at 115.69. On the weekly chart, it's important to remember that the EURJPY has overtaken its downtrend resistance line.
EURUSD had its high point at 1.3862 on Tuesday and it has been dithering and dropping ever since. After the NFP news this morning (a red herring if I ever saw one), price dropped to a low of 1.3545 so far, below its rather strong support at 1.3573 and below Monday's low of 1.3593. Next strong support is at 1.3500—quite a bit further down—and then 1.3435. At 1.35, I'd expect buyers to pile in—it's a nice round number, simple to wrap one's mind, if present, around. If 1.3435 doesn't hold it, expect support at 1.3396 and 1.3254. Should the pair manage to rally, and I doubt it will before the end of the day, expect to see resistance at 1.3662, 1.3750 and then beginning at 1.38 up to 1.3862. After that is 1.4060 but it's questionable whether it will ever get there.
GBPJPY managed to push to a spike high yesterday of 132.95 but then dropped this morning to a low of 130.87. The low this week was 1.3001 on Monday. Additional support is at 129.52. This really needs to hold. If it does, the bottom line here is that I'm still waiting to see Guppy touch 134.23 but there is quite a bit of resistance between here and there. If it can do this, the next resistance is at 135.22, 136.24, and 137.79. After that there is very little in the way of resistance until 141.19 (confluence) and then price resistance at 145.98, last April's high.
This pair, too, has broken above its very long-term downtrend line on the weekly chart so let's see if it can follow through.
GBPUSD had its high of 1.6282 yesterday and it's been downhill ever since to a low of 1.6036 this morning. I'm sure buyers will come in around 1.6000; 1.5942/63 would be an even better buy point at the daily flag upper boundary retest, fibo and polarity. Cable could be settling into a trading range between 1.5297 and 1.6300. If so, huah, as they say. There will be many opportunities to make some good pips. Support is here at 1.6037, 1.5960, 1.5830, and 1.5751 (1/25 low). Below that would be the bears firmly in control. Everyone has eyes on resistance of 1.6300. If price successfully overtakes and settles above this then 1.6461 and 1.6878 come into play.
USDCAD wasn't quite as dull this week but volatility is still low. .9838 is a key support level but I'm more interested in .9800/15, near the top of the ending diagonal/wedge pattern I wrote about earlier this week. Any reasonable person at this point would have to say the probability is for lower prices—the moving averages are pointing down, there was a bearish candle formation on the daily chart this week, price drops if anyone says boo, the dollar is dead blah blah. Where is support below .9800? The bottom of the downward sloping rectangle is .9753; the Feb. 2008 low was .9711; the triangle price target is .9549. Resistance? Well let's talk about that next week.
USDCHF came into the week with two key prices to watch—.9300 on the downside and .9784, January's high. During the week, the pair barely managed to stay above that .9300 low. If it drops below, there's weak support at .9278 but you'd probably see a good-sized drop. Yesterday it began a little rally and continued that this morning. However, until it climbs above .9784, there's not a lot to say.
USDJPY: All one can say is blah. There's low daily volatility, price is below all the daily moving averages and pointing down, and the yen is a weak currency. Yesterday's spike high was .8206 but it fell immediately. You can find better pairs to trade.
© Dianne Fecteau, 2011. 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.
Friday, February 4, 2011
Thursday, February 3, 2011
USDCHF—possibly basing
On the three-hour chart, the Swissy had three candles with lows from .9329 to .9333 yesterday. Since this is higher than the prior lows of .9323 on Jan. 3 and .9301 on 12/31, perhaps the pair really is trying to base. Whether it will be successful at that or not is a separate question. The pair needs to climb above .9783 which is quite a ways off—the high so far today is a spike to .9525. As I wrote yesterday, with the monthly triangle break down hanging over it, things don't look great. Still, there might be a run t .9600 or so. Support is at .9323, .9301 and a speed line at .9278. Below that is tohu-bohu.
© Dianne Fecteau, 2011. 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.
© Dianne Fecteau, 2011. 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—bull flag
AUDUSD—bull flag
Aussie still hasn't managed to overtake the 1.0148 Tuesday high, spiking to 1.0144 this morning. This may be only a retest of the Tuesday high prior to a move down but yesterday's low was 1.0055, almost spot on my potential C wave calculation of 1.0058.
On the three-hour chart, the pair broke above a bull flag with 1.0085 as the upper boundary. It has just retested that boundary. It doesn’t look as though it spent a lot of time inside the flag but it's at 2/3 of the time it took to build the flagpole. Price target is in the 103 to 104 zone that other price targets are lining up within. The flag's lower boundary is 1.0028. Below that is support is at .9988,.9916, .9867, .9804, .9740, and .9691.
It's also possible that the rectangle drawn on the chart will contain further upward price action.
I still have part of my position on from .9952 and added another one yesterday at 1.0074.
Here's the three-hour chart:
© Dianne Fecteau, 2011. 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.
Aussie still hasn't managed to overtake the 1.0148 Tuesday high, spiking to 1.0144 this morning. This may be only a retest of the Tuesday high prior to a move down but yesterday's low was 1.0055, almost spot on my potential C wave calculation of 1.0058.
On the three-hour chart, the pair broke above a bull flag with 1.0085 as the upper boundary. It has just retested that boundary. It doesn’t look as though it spent a lot of time inside the flag but it's at 2/3 of the time it took to build the flagpole. Price target is in the 103 to 104 zone that other price targets are lining up within. The flag's lower boundary is 1.0028. Below that is support is at .9988,.9916, .9867, .9804, .9740, and .9691.
It's also possible that the rectangle drawn on the chart will contain further upward price action.
I still have part of my position on from .9952 and added another one yesterday at 1.0074.
Here's the three-hour chart:
© Dianne Fecteau, 2011. 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, February 2, 2011
AUDUSD—softer
Cyclone Yasi, which just hit the northeastern coast of Australia in the past hour, may be softening the Aussie since damage is expected to be high. It's a terrible thing for Queensland which has had awful flooding recently.
The pair hit a high of 1.0148 before falling back to a low of 1.0065 so far (as of 10:23 AM EST). On the hourly chart this low created a hammer candle. If this is a simple, short-term ABC correction, 1.618 of the A wave would be 1.0058. Additional support is at .9988,.9916, .9867, .9804, .9740, and .9691. For the near term, one can watch the hourly chart. If the hammer low is broken at 1.0065, I'll probably lighten my long position.
Two things are important to remember with this pair: first, it's still in an overall uptrend; second, it has thrown off troubling signals (breaking a daily trend line, etc) that won't be fully overcome until it closes above 1.0257. If it does do that then there are attractive price targets in the 1.0350 area and higher.
On the monthly chart, the uptrend is in full display. Price is well above the monthly EMA at .9596 and this EMA roughly served as support in August and September. The most recent significant low is .9536 (below this would confirm the double top). The monthly uptrend line is at .9130. Bottom line is there could be quite a bit of correction before these monthly support levels are violated. There is negative divergence with RSI that has been going on since the 2008 low.As they say, you can go broke trading divergence—there needs to be other signals. On the weekly chart (not shown) there have been bearish engulfing candles twice.
If you're not already long with profits be careful with this pair right now.
Here's the monthly chart.
© Dianne Fecteau, 2011. 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 hit a high of 1.0148 before falling back to a low of 1.0065 so far (as of 10:23 AM EST). On the hourly chart this low created a hammer candle. If this is a simple, short-term ABC correction, 1.618 of the A wave would be 1.0058. Additional support is at .9988,.9916, .9867, .9804, .9740, and .9691. For the near term, one can watch the hourly chart. If the hammer low is broken at 1.0065, I'll probably lighten my long position.
Two things are important to remember with this pair: first, it's still in an overall uptrend; second, it has thrown off troubling signals (breaking a daily trend line, etc) that won't be fully overcome until it closes above 1.0257. If it does do that then there are attractive price targets in the 1.0350 area and higher.
On the monthly chart, the uptrend is in full display. Price is well above the monthly EMA at .9596 and this EMA roughly served as support in August and September. The most recent significant low is .9536 (below this would confirm the double top). The monthly uptrend line is at .9130. Bottom line is there could be quite a bit of correction before these monthly support levels are violated. There is negative divergence with RSI that has been going on since the 2008 low.As they say, you can go broke trading divergence—there needs to be other signals. On the weekly chart (not shown) there have been bearish engulfing candles twice.
If you're not already long with profits be careful with this pair right now.
Here's the monthly chart.
© Dianne Fecteau, 2011. 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—looks weak
USDCHF bulls are not having a good time. Price is below the 10, 20, 50, 100 and 200 daily moving averages. The 10 EMA on the monthly chart, which has been roughly capping the last few months, is well above price at .9886. Its low so far today has been .9321, very close to the prior low at .9301. There's a short-term speed line at .9278. If there's a rally coming it better show itself soon.
I wrote at the beginning of January that there's a seasonal tendency for the USD to rally against the Swiss franc in January. Prices since 1982 show that the pair has gone up 20 times and down 9 times. Not that you could have made much money with it but this January, unbelievably enough, was number 21. It closed on Dec. 31 at .9345 and closed Jan. 31 at .9429. The high was .9784 for the month.
I also wrote that the monthly chart looks grim and it still does. The pair fell from its monthly triangle in September and then below the October doji low of .9463. Support is at .9301 and the psychological .9200 but the potential downside target for the triangle is .9072.
Only a close back inside the triangle around 1.0192 would change the longer-term outlook. Nearer term, a close above .9783 would upset the bears since there were probably a fair number of shorts established in the .9450 to .9500 range.
Here's the monthly chart:
© Dianne Fecteau, 2011. 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.
I wrote at the beginning of January that there's a seasonal tendency for the USD to rally against the Swiss franc in January. Prices since 1982 show that the pair has gone up 20 times and down 9 times. Not that you could have made much money with it but this January, unbelievably enough, was number 21. It closed on Dec. 31 at .9345 and closed Jan. 31 at .9429. The high was .9784 for the month.
I also wrote that the monthly chart looks grim and it still does. The pair fell from its monthly triangle in September and then below the October doji low of .9463. Support is at .9301 and the psychological .9200 but the potential downside target for the triangle is .9072.
Only a close back inside the triangle around 1.0192 would change the longer-term outlook. Nearer term, a close above .9783 would upset the bears since there were probably a fair number of shorts established in the .9450 to .9500 range.
Here's the monthly chart:
© Dianne Fecteau, 2011. 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.
USDCAD—dropping
USDCAD is dropping after a bearish evening star candle formation on the daily chart (circled that on the chart below). Last week I blogged about the ending diagonal or descending wedge on this chart—it's outlined in blue. I would expect the upper line of this formation to serve as support at .9815 or the pattern will be invalid. However, to get there it must drop below the .9838 prior low. That would be a bearish signal so selling is likely to push it further down. How much further down could it go? .9753 is the price at the bottom of the downward sloping rectangle; the Feb. 2008 low was .9711; the triangle that began in May has a target of .9549. Then, of course, there is the gruesome 2007 low of .9058 but I don't think we have to worry about that just yet. Still, unless the dollar begins some sort of miraculous rally, the pair could be seeing .9549 if it breaks below .9815/00. If so, one would want to sell on a rally, perhaps to .9916.
Here's the daily chart:
© Dianne Fecteau, 2011. 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 daily chart:
© Dianne Fecteau, 2011. 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, February 1, 2011
EURUSD—bull flag target met
Euro met its bull flag target with its high this morning of 138.04. This is just above last week's high of 137.59 and it broke minor resistance of 1.3786 as well as meeting some interim price targets. Next up is 138.60 but the pair needs to settle above 137.60 today to begin its run to 1.4000. Above 1.4000 would cause the bears to gnashing their teeth and the true blue Elliott Wave people to quietly put away their bearish charts until they can find the next Elliott argument for a reversal point. So, to sum up, resistance is at 1.3860, 1.4060 and 1.4282.
On the negative side…well, over 1.38 is a major milestone so one would expect some backing and filling. Support is at 1.3572, 1.3499, 1.3396 and 1.3254. Below that is uh-oh land. However the three-hour chart looks good momentum wise, risk aversion seems to be down, and there are a lot of serious hands in Eurozone propping up the currency. This should help. At least until the next shoe drops. And it will.
Here's the three-hour chart:
© Dianne Fecteau, 2011. 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 negative side…well, over 1.38 is a major milestone so one would expect some backing and filling. Support is at 1.3572, 1.3499, 1.3396 and 1.3254. Below that is uh-oh land. However the three-hour chart looks good momentum wise, risk aversion seems to be down, and there are a lot of serious hands in Eurozone propping up the currency. This should help. At least until the next shoe drops. And it will.
Here's the three-hour chart:
© Dianne Fecteau, 2011. 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—taking its time
As I wrote last week, Guppy broke above strong resistance, a long-term downtrend line on the weekly chart. In order for this to mean something more than what it is, it must close above the 134.23 November high. Last week it touched 132.58 and sprung back as though shot, immediately retracing almost the entire move up from 128.70, dropping to 128.82 on Friday. Late yesterday it touched 132.00 for about three minutes before falling back again. I bought yesterday at 130.65 after the pair missed my buy order at 129.55. Obviously, I'm at better than breakeven but the pair needs to get moving.
On the daily chart below, it's peeking above the daily downtrend line from this past August. Troubling signs are the long upper shadow on the circled candle which hints that it's rejecting higher prices right at confluence and the two long bearish candles the last few days. The most recent price action on the three-hour chart (not shown) is forming into an ascending triangle. Ascending triangles typically break upwards.
If it does break upwards then resistance is at 132.58, 133.00, 134.23, 135.22, 136.24, and 137.79. After that there is very little in the way of resistance until 141.19 (confluence) and then price resistance at 145.98, last April's high.
Support is at 129.50, 128.99, 127.50, 126.73/46 and 125.55.
Here's the daily chart:
© Dianne Fecteau, 2011. 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 daily chart below, it's peeking above the daily downtrend line from this past August. Troubling signs are the long upper shadow on the circled candle which hints that it's rejecting higher prices right at confluence and the two long bearish candles the last few days. The most recent price action on the three-hour chart (not shown) is forming into an ascending triangle. Ascending triangles typically break upwards.
If it does break upwards then resistance is at 132.58, 133.00, 134.23, 135.22, 136.24, and 137.79. After that there is very little in the way of resistance until 141.19 (confluence) and then price resistance at 145.98, last April's high.
Support is at 129.50, 128.99, 127.50, 126.73/46 and 125.55.
Here's the daily chart:
© Dianne Fecteau, 2011. 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.
Egypt
My thoughts and warm wishes go out to Egypt, a fascinating country and a place where I've spent two wonderful vacations.
AUDUSD—rises again
Aussie rose throughout the Asian and early morning European session, reaching a high of 1.0085 as of 9:03 AM EST. This is almost exactly the .618 retracement of the drop from 1.0257 to .9804 and a few pips above the confirmation point for the double bottom in January (.9804 on 1/11 and .9833 on 1/20). So, technically, the double bottom has been confirmed but let's see if the pair can close above it for the day. If so, then the price target is 1.0350. The last closed candle on the hourly chart was a doji so I'd expect some retracement here.
I wrote yesterday about the diamond pattern. The price target for the diamond was 1.0082. Normally one would expect a bit better than only the minimum price target but the reality is that this is heavy resistance. If it successfully scales 1.0083, the next resistance is at 1.0183 and 1.0257, the December high.
As to all the mutterings about double tops (1.0183 and 1.0257)—there is no double top until it's confirmed with a break below .9538. At this moment, good luck with that. Before it gets there it will find support at .9988,.9916, .9867, .9804, .9740, and .9691. However, I'm not completely bullish on the pair although I'm still long from .9952. It's troubling when a pair breaks a trendline and throws off bearish candles on the weekly chart. But as I've written before, this pair is like a rubber doll you punch down and then it comes right back at you.
© Dianne Fecteau, 2011. 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.
I wrote yesterday about the diamond pattern. The price target for the diamond was 1.0082. Normally one would expect a bit better than only the minimum price target but the reality is that this is heavy resistance. If it successfully scales 1.0083, the next resistance is at 1.0183 and 1.0257, the December high.
As to all the mutterings about double tops (1.0183 and 1.0257)—there is no double top until it's confirmed with a break below .9538. At this moment, good luck with that. Before it gets there it will find support at .9988,.9916, .9867, .9804, .9740, and .9691. However, I'm not completely bullish on the pair although I'm still long from .9952. It's troubling when a pair breaks a trendline and throws off bearish candles on the weekly chart. But as I've written before, this pair is like a rubber doll you punch down and then it comes right back at you.
© Dianne Fecteau, 2011. 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 31, 2011
EURGBP—triangle
EURGBP has generally been in an uptrend since late last June but the dip to .8285 was disappointing since it was a lower low than the prior dip to .8335. That's not a huge amount of pips but it's a warning. There are lots of triangles around these days and EURGBP is no exception. Bulls expected price would reach the upper boundary around .8826 before turning but it failed at .8672, quite a bit short of that and just pips above the 12/31 high. The upper boundary is near fib confluence of .8849/10 (.5 and .618 of the move down from .9412 and .9134 respectively). Perhaps it will get there in the next few days but obviously it has to close above .8672. Looking at the large bullsh candle before the last couple of day's pullback, it seems possible. Support is at confluence at .8505 and .8424/00 and then the trend line at .8348. A close below .8285 would bring in support at .8143 and .8068. My inclination is to buy near there or possibly at present levels if momentum shapes up on the shorter term charts.
Here's a daily chart:
© Dianne Fecteau, 2011. 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 a daily chart:
© Dianne Fecteau, 2011. 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—triangle
On the daily and three-hour chart, one can observe an obvious triangle. From the Elliott perspective, price entered the triangle from an uptrend. Therefore, price should break upwards. If it does so, 1.0307 is the target (453 pips added to the breakout point of the triangle). There is an unconfirmed double bottom in January (.9804 on 1/11 and .9833 on 1/20). It will be confirmed if price breaks above 1.0077. Its price target is 1.0350. So there are two price targets within pips of each other. 1.0364 is also where some resistance lines come in (i.e. see the prior post for the weekly chart—the upper wedge line ends there).
On the three-hour chart, one can observe a diamond pattern. When these patterns succeed, price often moves rapidly. A break upward, though, would bump its head on fib confluence at .9974 but the real interest will be in price behavior if the pair approaches 1.0022 and 1.0083 (.618 of the move from 1.0257 to .9804). If it slices through those, then expect an attempt on 1.0183, 1.0257, and price targets in the 1.03 area. Failure from the triangle targets .9916, .9867, .9804, .9740, .9691and .9538.
Here's a three-hour chart:
© Dianne Fecteau, 2011. 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, one can observe a diamond pattern. When these patterns succeed, price often moves rapidly. A break upward, though, would bump its head on fib confluence at .9974 but the real interest will be in price behavior if the pair approaches 1.0022 and 1.0083 (.618 of the move from 1.0257 to .9804). If it slices through those, then expect an attempt on 1.0183, 1.0257, and price targets in the 1.03 area. Failure from the triangle targets .9916, .9867, .9804, .9740, .9691and .9538.
Here's a three-hour chart:
© Dianne Fecteau, 2011. 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—weekly chart
Aussie is throwing off some conflicting signals and I have price targets in both directions from both the longer and shorter-term charts. However, the longer-term uptrend has not been definitively reversed despite a break of the shorter-term trendline from June 2010 and some bearish candles.
Price has been hanging around just below the red broken uptrend line and since that line is resistance, I consider this bullish—there's just not enough selling coming in to overwhelm the bulls and push price down even after the bearish break. I'm wondering if the short-term "fundamental" news—flooding and potential cyclones—isn't driving this downward move. Note the wedge (the red lower line and the blue upper line both pointing upwards to a meeting point in the next couple of weeks). Rising wedges tend to break downward because the steepest angle is the least sustainable. Prices have dipped below the wedge but usually once they break below they fall rather quickly. This hasn't happened.
Weekly support is at .9797 (weekly 20 EMA), .9537 (December low),.8770, .8067 and .7920 (weekly uptrend line from 2008). Weekly resistance is at 1.0086 (broken uptrend line), 1.0183 and 1.0257)
Here's the weekly chart:
© Dianne Fecteau, 2011. 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.
Price has been hanging around just below the red broken uptrend line and since that line is resistance, I consider this bullish—there's just not enough selling coming in to overwhelm the bulls and push price down even after the bearish break. I'm wondering if the short-term "fundamental" news—flooding and potential cyclones—isn't driving this downward move. Note the wedge (the red lower line and the blue upper line both pointing upwards to a meeting point in the next couple of weeks). Rising wedges tend to break downward because the steepest angle is the least sustainable. Prices have dipped below the wedge but usually once they break below they fall rather quickly. This hasn't happened.
Weekly support is at .9797 (weekly 20 EMA), .9537 (December low),.8770, .8067 and .7920 (weekly uptrend line from 2008). Weekly resistance is at 1.0086 (broken uptrend line), 1.0183 and 1.0257)
Here's the weekly chart:
© Dianne Fecteau, 2011. 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.
Week Ending 28 January 2011
Here are the highs, lows, and closes for the past week:
© Dianne Fecteau, 2011. 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.
© Dianne Fecteau, 2011. 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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