Beginning today, 18 June, I'll be taking most Friday's off this summer. Summer generally has less liquidity and Friday's usually have less than the other days. It doesn't mean there can't be some interesting moves--less liquid markets are likely to see this happen--but in general it's a good time to relax a bit.
See you Monday.
Friday, June 18, 2010
Thursday, June 17, 2010
AUDUSD—update
I closed my trade from .8663 at +55 pips and the one from .8670 profit-stopped out at +10 pips. Now the pair is edging back towards the tantalizing .8674/82. I'm getting ready to wrap up for the day but may consider another position depending on price behavior and momentum in the near-term.
© 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.
© 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—weak
I closed my long for +500 pips after it faltered here once again. I'm short from .8670 and .8663.
Building on what I've written about AUDUSD, the picture is looking weaker. After my earlier blog post the pair rose again, this time reaching a high of .8682 or 8 pips higher than the prior two recent highs.
Gann wrote that if a pair repeatedly touches a price it will probably break through after a few tries. This may be true but I don't expect to see momentum falter as it did on the short-term charts (lower highs in the oscillator with higher highs in price). Remember, too, I was concerned about the longer-term context with too steep an angle on the daily ascent. While the pair still has a potential price target of .9035 from the double bottom, it doesn't seem able to pull it off without gathering a little more energy. Another pullback might give it what it takes. So I won't be opposed to going long at some point.
A look at the three-hour chart shows weakness. First, if you look at the blue uptrend lines I've drawn under price and RSI you can see that it has broken below both of them. This isn't good. Second, if you look at the red lines around price, it shows narrowing price action in a wedge formation. Wedges can be consolidation formations with or against the prevailing trend. So it's inconclusive here but with other hints from the charts I find it short-term negative. Comparing the red uptrend line under price with the red downtrend line on RSI suggests negative divergence. Given these plus additional clues from the shorter-term charts, I decided that short was the better position as of now. Since I just moved my stop to breakeven on both my new shorts, I have little risk here.
We do have the support of .8582 from overnight to contend with that I blogged about earlier. As price approaches this level, I'll study price behavior and momentum and may close at least one of my short positions. However, if the pair breaks below here, the next supports are at .8551/46, .8495/88, .8426, .8400, .8364/56, .8258, .8195, .8133, .8082 and .8067.
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.
Building on what I've written about AUDUSD, the picture is looking weaker. After my earlier blog post the pair rose again, this time reaching a high of .8682 or 8 pips higher than the prior two recent highs.
Gann wrote that if a pair repeatedly touches a price it will probably break through after a few tries. This may be true but I don't expect to see momentum falter as it did on the short-term charts (lower highs in the oscillator with higher highs in price). Remember, too, I was concerned about the longer-term context with too steep an angle on the daily ascent. While the pair still has a potential price target of .9035 from the double bottom, it doesn't seem able to pull it off without gathering a little more energy. Another pullback might give it what it takes. So I won't be opposed to going long at some point.
A look at the three-hour chart shows weakness. First, if you look at the blue uptrend lines I've drawn under price and RSI you can see that it has broken below both of them. This isn't good. Second, if you look at the red lines around price, it shows narrowing price action in a wedge formation. Wedges can be consolidation formations with or against the prevailing trend. So it's inconclusive here but with other hints from the charts I find it short-term negative. Comparing the red uptrend line under price with the red downtrend line on RSI suggests negative divergence. Given these plus additional clues from the shorter-term charts, I decided that short was the better position as of now. Since I just moved my stop to breakeven on both my new shorts, I have little risk here.
We do have the support of .8582 from overnight to contend with that I blogged about earlier. As price approaches this level, I'll study price behavior and momentum and may close at least one of my short positions. However, if the pair breaks below here, the next supports are at .8551/46, .8495/88, .8426, .8400, .8364/56, .8258, .8195, .8133, .8082 and .8067.
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—yesterday's behavior; a post-mortem
Yesterday I blogged about the triangle on the short-term chart. What happened after that? As you can see on the chart below, the pair broke below the triangle (label 1 on the chart at .8625), dropped to label 2 on the chart (.8582), rose to label 3 (.8674), and then dropped to .8583 (label 4) in what shaped up to be a rectangle. It broke out above this at label 5 to a high so far this morning of .8674. Here it formed a doji candle known as a gravestone (label 6).
The doji is bearish and the pair has since fallen back a bit although since I captured the picture it is back. This is what the chart looks like in hindsight:
As messy as this looks in hindsight, there is a wealth of information here for the trader. First, the height of the triangle was 43 pips (.8658 - .8615). You could have used this to establish a price target and if you use the price where the pair broke below (label 1 at .8625) and subtract 43 pips you get .8582. This is where the pair stopped exactly at label 2 before reversing. Had you gone short at the moment of breakout (admittedly difficult to do when you're concerned that this may be a fake-out) you would have made 42 pips. That though isn't worth much.
At the bottom of .8582, the pair formed four five-minute candles, each with the same low. This is a sign of basing and the wise trader would have exited (or at least lightened shorts). This caught my interest and I put on another long (which has subsequently stopped at breakeven). One of my original longs profit stopped at +10 pips before it got here; the other (from .8175) is still on.
The pair then returned to the triangle and continued to .8674 at label 3. Most traders would now say the break down had been fake. Some might have bought. However that top formed as a result of a long upper shadow which shows indecision. If you had read my blog yesterday, you would have known I was skeptical that the AUDUSD could continue up with the steep rate of ascent on the daily chart. So I for one, with my somewhat bearish mindset albeit on a pair I'd just taken partial profits on of 455 pips, was not interested in additional longs. The pair then formed a downward rectangle. Where did the price decline stop? At label 4 or .8583. This was one pip away from the first low at label 2. Had I been awake, I would have bought here. I wasn't; I didn't.
Since then it has risen again to.8674, fallen off, and now (not on this chart) is back at it.
Why is this valuable? I now have a range of .8582 to .8674 that the pair is respecting. Both times it has reached the high, it has thrown off an upper shadow that represents indecision. Looking at RSI, I can see that at the first high (label 3), RSI reached 68.03. At label 6, RSI moved higher, over 70. So price is the same and the oscillator is moving higher. This is divergence. It's negative because price hasn't made a new high with the higher oscillator. The final interesting point is that this is resistance in the larger time frame where I identified it yesterday but it's just ahead of even larger resistance at .8707. (Resistance is at .8658/67, .8707/28 (50% of the .92390 to .8067 move, polarity, and a fibonacci calculation of price target based on corrective wave behavior).
On the lower end of the range, there's a hammered out base that the pair respected the second time it returned to .8583. Here, RSI was slightly higher than the first time but was more notable for the positive divergence just before it returned (orange line on RSI and price). This was a big clue the pair would reverse upward but as a I said, I was sleeping.
What we're seeing here is consolidation at best (which you see on the hourly chart below). However, even a clean break above .8674 with no hesitation or divergence on the part of RSI leaves me unable to go long with comfort until the pair breaks the formidable resistance at .8707/28. At that point I can go long. At worst, we're seeing an uptrend breaking down but we won't really know that until the pair closes cleanly below .8582. There's some other information in these short-term movements as well but I'm running out of time so I'll stop here.
I went through all this to show how short term trades can be made within a longer term context but that the longer term analysis comes back to bear on the short term trader. In addition, you can use the short-term patterns and moves either for trading (tricky sometimes) or to refine support and resistance.
In any case, levels are pretty much the same as yesterday. Resistance is at .8674, .8707/28 (50% of the .92390 to .8067 move, polarity, and a fibonacci calculation of price target based on corrective wave behavior), .8800, .8897, .9000, and .9035.
Support is at .8582 (strong), .8551/46, .8495/88, .8426, .8400, .8364/56, .8258, .8195, .8133, .8082 and .8067.
Here’s the hourly chart:
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
The doji is bearish and the pair has since fallen back a bit although since I captured the picture it is back. This is what the chart looks like in hindsight:
As messy as this looks in hindsight, there is a wealth of information here for the trader. First, the height of the triangle was 43 pips (.8658 - .8615). You could have used this to establish a price target and if you use the price where the pair broke below (label 1 at .8625) and subtract 43 pips you get .8582. This is where the pair stopped exactly at label 2 before reversing. Had you gone short at the moment of breakout (admittedly difficult to do when you're concerned that this may be a fake-out) you would have made 42 pips. That though isn't worth much.
At the bottom of .8582, the pair formed four five-minute candles, each with the same low. This is a sign of basing and the wise trader would have exited (or at least lightened shorts). This caught my interest and I put on another long (which has subsequently stopped at breakeven). One of my original longs profit stopped at +10 pips before it got here; the other (from .8175) is still on.
The pair then returned to the triangle and continued to .8674 at label 3. Most traders would now say the break down had been fake. Some might have bought. However that top formed as a result of a long upper shadow which shows indecision. If you had read my blog yesterday, you would have known I was skeptical that the AUDUSD could continue up with the steep rate of ascent on the daily chart. So I for one, with my somewhat bearish mindset albeit on a pair I'd just taken partial profits on of 455 pips, was not interested in additional longs. The pair then formed a downward rectangle. Where did the price decline stop? At label 4 or .8583. This was one pip away from the first low at label 2. Had I been awake, I would have bought here. I wasn't; I didn't.
Since then it has risen again to.8674, fallen off, and now (not on this chart) is back at it.
Why is this valuable? I now have a range of .8582 to .8674 that the pair is respecting. Both times it has reached the high, it has thrown off an upper shadow that represents indecision. Looking at RSI, I can see that at the first high (label 3), RSI reached 68.03. At label 6, RSI moved higher, over 70. So price is the same and the oscillator is moving higher. This is divergence. It's negative because price hasn't made a new high with the higher oscillator. The final interesting point is that this is resistance in the larger time frame where I identified it yesterday but it's just ahead of even larger resistance at .8707. (Resistance is at .8658/67, .8707/28 (50% of the .92390 to .8067 move, polarity, and a fibonacci calculation of price target based on corrective wave behavior).
On the lower end of the range, there's a hammered out base that the pair respected the second time it returned to .8583. Here, RSI was slightly higher than the first time but was more notable for the positive divergence just before it returned (orange line on RSI and price). This was a big clue the pair would reverse upward but as a I said, I was sleeping.
What we're seeing here is consolidation at best (which you see on the hourly chart below). However, even a clean break above .8674 with no hesitation or divergence on the part of RSI leaves me unable to go long with comfort until the pair breaks the formidable resistance at .8707/28. At that point I can go long. At worst, we're seeing an uptrend breaking down but we won't really know that until the pair closes cleanly below .8582. There's some other information in these short-term movements as well but I'm running out of time so I'll stop here.
I went through all this to show how short term trades can be made within a longer term context but that the longer term analysis comes back to bear on the short term trader. In addition, you can use the short-term patterns and moves either for trading (tricky sometimes) or to refine support and resistance.
In any case, levels are pretty much the same as yesterday. Resistance is at .8674, .8707/28 (50% of the .92390 to .8067 move, polarity, and a fibonacci calculation of price target based on corrective wave behavior), .8800, .8897, .9000, and .9035.
Support is at .8582 (strong), .8551/46, .8495/88, .8426, .8400, .8364/56, .8258, .8195, .8133, .8082 and .8067.
Here’s the hourly chart:
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
Wednesday, June 16, 2010
EURUSD—update
My longs from 1.2236 and 1.2247 were profit-stopped out at +30 and +19 pips respectively. These were not optimal levels for a stop and they should have been stopped at breakeven since 30 and 19 pips is a waste of time for the most part. Ok, I can beat myself up or I can move on. I'll move on. I established a new long at 1.2270 after the pair seemingly bounced from 1.2255 with a hammer on the 15-minute 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.
© 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—triangle on short-term chart
Very interesting triangle formation on the shorter-term chart. If the pair can cleanly break above or below (watch for fake-outs), then the direction should be established. Here's a picture of a five-minute chart. (My trades don't show as they were established too far back on such a short-term 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.
© 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—narrow range
I have two long positions—one from .8175 and one from .8583. I took partial profits at +455 pips yesterday afternoon on the position from .8175. Both are obviously profit-stopped so there are no worries on my part.
Since it confirmed the double bottom at .8551 the price target is a hale and hearty .9035. I find that unlikely, at least in the near-term for several reasons. If you look at this pair on a daily chart, it's clear it cannot maintain this angle of ascent. In fact, on the daily chart it looks as though it could be tracing out an ABC correction with the C leg being currently a bit greater in length to the A leg. If C was to become 1.61 of A then the pair could get to .8861 before turning back down. If I saw that, along with a another failure of RSI above 70 on the hourly chart, I'd be confident enough to take a good-sized short position. We'll see. But for now, as I said, I'm still long.
The pair has been in a narrow range since yesterday. It will break out of this eventually.
Resistance is at .8658/67, .8707/28 (50% of the .92390 to .8067 move, polarity, and a fibonacci calculation of price target based on corrective wave behavior), .8800, .8897, .9000, and .9035.
Support is at .8594, .8551/46, .8495/88, .8426, .8400, .8364/56, .8258, .8195, .8133, .8082 and .8067.
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.
Since it confirmed the double bottom at .8551 the price target is a hale and hearty .9035. I find that unlikely, at least in the near-term for several reasons. If you look at this pair on a daily chart, it's clear it cannot maintain this angle of ascent. In fact, on the daily chart it looks as though it could be tracing out an ABC correction with the C leg being currently a bit greater in length to the A leg. If C was to become 1.61 of A then the pair could get to .8861 before turning back down. If I saw that, along with a another failure of RSI above 70 on the hourly chart, I'd be confident enough to take a good-sized short position. We'll see. But for now, as I said, I'm still long.
The pair has been in a narrow range since yesterday. It will break out of this eventually.
Resistance is at .8658/67, .8707/28 (50% of the .92390 to .8067 move, polarity, and a fibonacci calculation of price target based on corrective wave behavior), .8800, .8897, .9000, and .9035.
Support is at .8594, .8551/46, .8495/88, .8426, .8400, .8364/56, .8258, .8195, .8133, .8082 and .8067.
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—still sluggish
I'm still long from 1.2236 and 1.2247.
The pair closed yesterday at 1.2318 which was above the 20 day SMA that has been holding it down since April. That average is now at 1.2223. It has barely taken out yesterday's high of 1.2349, touching 1.2353 overnight. I wrote yesterday that since early Monday the Euro appeared to be basing in the 1.2164 area. For the last few three-hour bars it appears to be trying to base at .2262/74.
The fact is that at the moment the pair has been in a narrow 91 pip range for the last 22 hours. It will break out of this range eventually. The clues are for an upward breakout (the higher levels of basing, the higher highs and higher lows of the past few days, the fact that it's back at an Elliott Wave 4th wave triangle which can cause resistance) but its sluggishness is less than inspiring.
If the pair can break upward, 1.2575/83 is a target. As long as the Euro stays above 1.2150/65, this is a good possibility. So, if you're not already long, you could wait to buy on a pullback. The 20 day SMA at 1.2223 would be good or somewhat above, up to 1.2250. Otherwise, you could wait for a breakout from this resistance area. Shorts will make sense if momentum breaks down completely but I'll blog if that happens because I'll probably reverse.
Resistance is at 1.2353, 1.245, 1.2575 and 1.2673. Support is at 1.2299, 1.2223, 1.2164/50, 1.2117, 1.2045/25, and then prior lows.
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 closed yesterday at 1.2318 which was above the 20 day SMA that has been holding it down since April. That average is now at 1.2223. It has barely taken out yesterday's high of 1.2349, touching 1.2353 overnight. I wrote yesterday that since early Monday the Euro appeared to be basing in the 1.2164 area. For the last few three-hour bars it appears to be trying to base at .2262/74.
The fact is that at the moment the pair has been in a narrow 91 pip range for the last 22 hours. It will break out of this range eventually. The clues are for an upward breakout (the higher levels of basing, the higher highs and higher lows of the past few days, the fact that it's back at an Elliott Wave 4th wave triangle which can cause resistance) but its sluggishness is less than inspiring.
If the pair can break upward, 1.2575/83 is a target. As long as the Euro stays above 1.2150/65, this is a good possibility. So, if you're not already long, you could wait to buy on a pullback. The 20 day SMA at 1.2223 would be good or somewhat above, up to 1.2250. Otherwise, you could wait for a breakout from this resistance area. Shorts will make sense if momentum breaks down completely but I'll blog if that happens because I'll probably reverse.
Resistance is at 1.2353, 1.245, 1.2575 and 1.2673. Support is at 1.2299, 1.2223, 1.2164/50, 1.2117, 1.2045/25, and then prior lows.
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.
EURCHF—pullback below 1.40
Touching a low of 1.3888 so far today, the pair has pulled back to dance on its short-term downtrend line that it rose above yesterday when it broke the 1.40 barrier. My long from 1.3787 profit-stopped out at 1.3917 for +130 pips. I haven't gotten back in and want to study price action a bit longer before I make a decision. Certainly, another break above 1.40 might convince me of a long.
Yesterday was 4th day of higher highs and higher lows but yesterday was a doji candle that is known as a gravestone and this is bearish. The rounding type of top on the three-hour chart (although a doji poked its head above) is also bearish. It's not impossible that the Swiss might still intervene so one has to be careful to keep the stops tight if shorting.
Resistance is at 1.4000, 1.4044, 1.4179, 1.4309, 1.4480 and 1.4509. If it gets to 1.4509 a lot of people are going to be really amazed. Support is at 1.3985, 1.3924, 1.3870, 1.3816, 1.3774, and 1.3734.
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 was 4th day of higher highs and higher lows but yesterday was a doji candle that is known as a gravestone and this is bearish. The rounding type of top on the three-hour chart (although a doji poked its head above) is also bearish. It's not impossible that the Swiss might still intervene so one has to be careful to keep the stops tight if shorting.
Resistance is at 1.4000, 1.4044, 1.4179, 1.4309, 1.4480 and 1.4509. If it gets to 1.4509 a lot of people are going to be really amazed. Support is at 1.3985, 1.3924, 1.3870, 1.3816, 1.3774, and 1.3734.
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.
Tuesday, June 15, 2010
EURUSD—update
I took partial profits from one of my longs (the one from 1.2236) for +100 pips.
© 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.
© 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—narrow range
Not much has been going on with AUDUSD. It's off from its high of .8667 but sort of languishing at this point. I'm still long from .8175 and when the pair starts to show some movement I'll post more about it.
EURO Word Cloud
It has been some time since I've created a word cloud of various reports on the EURUSD. What I did was gather several analyst's reports on the Euro this morning and created the cloud. The more a word is mentioned, the bigger it appears in the cloud. What this cloud tells you is that nobody is saying absolutely anything of note. Here's the cloud:
© 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.
© 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—sluggish
My long from 1.2254 stopped at breakeven. I went long again at 1.2236 and entered another long this morning at 1.2244.
Since early Monday the Euro has appeared to be basing in the 1.2164 area but it's not exactly setting the world on fire, even though there have been five days of higher highs and higher lows. yesterdat, 1.2299 was the high. It's high this morning, so far, has been 1.2276. It needs to close above the 20 day SMA (simple moving average) on the daily chart since price has been below there since April until yesterday. The SMA is currently at 1.2221. Whether it will or not is still a question. Whereas once Euro bulls dominated (remember those days?), now it's the bears who don't want to give up their dominance.
There's hidden divergence on the daily chart (lower high in price and higher high in the RSI) which hints at a continuation of the downtrend. Since I still believe the Euro is weak and because of this divergence, you might ask why I'm long. The reason is that I don’t believe the pair can drop much more until there's a rally of some sort. Prices don't go straight down after all and who is left to sell the damn thing right now? From an Elliott Wave perspective the pair seems to have completed a fifth wave and with yesterday's high of 1.2299 moved back to a 4th wave triangle. One would expect some resistance there. There's also a short-term trend line on the daily chart coming in at this level.
If the pair can get through this then it's very believable it can climb to 1.2575/83. As long as the Euro stays above 1.2150/65, this is a good possibility.
Resistance is at 1.2299, 1.2326, 1.2453 and 1.2673. Support is at 1.2216, 1.2164/50, 1.2117, 1.2045/25, and then prior lows.
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.
Since early Monday the Euro has appeared to be basing in the 1.2164 area but it's not exactly setting the world on fire, even though there have been five days of higher highs and higher lows. yesterdat, 1.2299 was the high. It's high this morning, so far, has been 1.2276. It needs to close above the 20 day SMA (simple moving average) on the daily chart since price has been below there since April until yesterday. The SMA is currently at 1.2221. Whether it will or not is still a question. Whereas once Euro bulls dominated (remember those days?), now it's the bears who don't want to give up their dominance.
There's hidden divergence on the daily chart (lower high in price and higher high in the RSI) which hints at a continuation of the downtrend. Since I still believe the Euro is weak and because of this divergence, you might ask why I'm long. The reason is that I don’t believe the pair can drop much more until there's a rally of some sort. Prices don't go straight down after all and who is left to sell the damn thing right now? From an Elliott Wave perspective the pair seems to have completed a fifth wave and with yesterday's high of 1.2299 moved back to a 4th wave triangle. One would expect some resistance there. There's also a short-term trend line on the daily chart coming in at this level.
If the pair can get through this then it's very believable it can climb to 1.2575/83. As long as the Euro stays above 1.2150/65, this is a good possibility.
Resistance is at 1.2299, 1.2326, 1.2453 and 1.2673. Support is at 1.2216, 1.2164/50, 1.2117, 1.2045/25, and then prior lows.
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.
EURCHF—broke above 1.40
This pair now has three days of higher highs and higher lows, has broken above its short-term downtrend line, and has overcome the 1.40 psychological barrier for a high of 1.4040 so far. A lot of shorts probably covered once above 1.40 so that may have helped th climb up to 1.4040. I am long from 1.3787 and have just taken partial profits at +233 pips.
1.4044 is a resistance level so the pair needs to get through here. The candles on the daily chart have been strong. However, it's still unlikely this pair is reversing trend. On the hourly chart it is moving above 70 on RSI so it's overbought. If it closes below 70 and price is faltering, it may be time to go short. It's not impossible that the Swiss might still intervene so one has to be careful to keep the stops tight.
Resistance is at 1.4044, 1.4179, 1.4309, 1.4480 and 1.4509. If it gets to 1.4509 a lot of people are going to be really amazed. Support is at 1.4000, 1.3985, 1.3924, 1.3870, 1.3816, 1.3774, and 1.3734.
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.
1.4044 is a resistance level so the pair needs to get through here. The candles on the daily chart have been strong. However, it's still unlikely this pair is reversing trend. On the hourly chart it is moving above 70 on RSI so it's overbought. If it closes below 70 and price is faltering, it may be time to go short. It's not impossible that the Swiss might still intervene so one has to be careful to keep the stops tight.
Resistance is at 1.4044, 1.4179, 1.4309, 1.4480 and 1.4509. If it gets to 1.4509 a lot of people are going to be really amazed. Support is at 1.4000, 1.3985, 1.3924, 1.3870, 1.3816, 1.3774, and 1.3734.
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, June 14, 2010
EURCHF—sputtering along
The pair reached a high of 1.3963 before falling back a bit and it looks as though the psychological number of 1.40 may be tantalizingly out of reach. However, while short sellers are coming in, one needs to be careful. For one thing, there's still the chance of Swiss bank intervention, which is sort of becoming like the elephant in the room but there you go.
It still appears unlikely to me that this strong down trend is going to reverse upwards. Currently, it's being held back by the 1.40 psychological and prior support as well as a short-term downtrend line.
But my long from 1.3787 is up 143 pips and is profit-stopped, I had a nice little profit on my other long this past Friday, so I'll sit tight for now. I am quite happy to reverse on this pair should momentum, as represented by RSI, begin breaking down.
Resistance is at 1.3963, 1. 4000, 1.4044, and 1.4179. Support is at 1.3870, 1.3816, 1.3774, and 1.3734.
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.
It still appears unlikely to me that this strong down trend is going to reverse upwards. Currently, it's being held back by the 1.40 psychological and prior support as well as a short-term downtrend line.
But my long from 1.3787 is up 143 pips and is profit-stopped, I had a nice little profit on my other long this past Friday, so I'll sit tight for now. I am quite happy to reverse on this pair should momentum, as represented by RSI, begin breaking down.
Resistance is at 1.3963, 1. 4000, 1.4044, and 1.4179. Support is at 1.3870, 1.3816, 1.3774, and 1.3734.
Here's the three-hour chart:
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
EURUSD—what next?
Euro has continued to rise from its June 6th 1.1876 low and this may turn into a much-needed correction that could take the pair to 1.2500 or so. However, its attempts to grind higher are painful to watch and in no way do I believe that it won't continue down again, possibly to parity. While the immediate fears over the European debt crisis seem to have abated somewhat, there are deeper systemic problems that haven't yet been corrected. But I'm a technical trader and not a fundamental trader so I'll continue to trade the chart.
I've entered a small long position at 1.2254.
Looking at the three-hour chart this morning, you can see a break above prior support in the 1.2150 area so one wouldn't expect a drop below that if the current rally is going to continue. I'll be stopped out before it gets to that point but I may go long again there depending on price behavior. Additional resistance is at 1.2326, 1.2453 and 1.2673. The pair has moved over 70 RSI in the shorter-term charts so this may have to be relieved before additional highs are possible. On the other hand, a breakdown in RSI (below its uptrend line) along with a drop below 1.2150 in price could signal that the downtrend isn't yet complete. Still…who hasn't sold at this point? But, going along with this, there may not be enough buyers to keep a rally going. We'll have to see. Support is at 1.2216, 1.2150, 1.2117, 1.2045/25, and then prior lows.
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.
I've entered a small long position at 1.2254.
Looking at the three-hour chart this morning, you can see a break above prior support in the 1.2150 area so one wouldn't expect a drop below that if the current rally is going to continue. I'll be stopped out before it gets to that point but I may go long again there depending on price behavior. Additional resistance is at 1.2326, 1.2453 and 1.2673. The pair has moved over 70 RSI in the shorter-term charts so this may have to be relieved before additional highs are possible. On the other hand, a breakdown in RSI (below its uptrend line) along with a drop below 1.2150 in price could signal that the downtrend isn't yet complete. Still…who hasn't sold at this point? But, going along with this, there may not be enough buyers to keep a rally going. We'll have to see. Support is at 1.2216, 1.2150, 1.2117, 1.2045/25, and then prior lows.
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--chart
Here's the 3-hour AUDUSD chart I couldn't post earlier:
© 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.
© 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—double bottom confirmed
I have one long position from .8175 which is performing well, up over 400 pips this morning.
In addition to breaking above an ascending triangle on the three-hour chart, the pair confirmed its double bottom when it rose above .8551. Some might say it's a triple bottom but there should be at least a few periods between two bottoms and the ones at .8067 and .8082 are more classic with eight days between them whereas the bottom of .8073 and .8067 only had two days between them. More is better in this case. Even eight days is not great but we'll take what we can get. These were both sharp bottoms rather than more rounded, gradual ones (which I prefer but it is what it is).
Now that it has been confirmed there is a price projection of .9035. Do I believe it? Does it matter whether I believe it or not? I'll just have to keep an eye on momentum. If it starts to falter, especially in the presence of other weakness (i.e. candle formations) and near resistance, then I'll probably at least lighten my long. As far as adding longs, I wasn't around when the pair broke above .8500 so I didn't add. At this point all I can do is add on pullbacks if that's what I want to do.
The pair is running into some resistance at its current levels where .8595 was identified last week as resistance. Tthe high this morning was .8614 so far and the pair is overbought (above 70 on RSI) on the shorter-term charts. More important resistance will rear up at .8707/28. This is 50% of the .92390 to .8067 move, polarity, and a fibonacci calculation of price target based on corrective wave behavior. If it can make it through there then the .9035 may look more feasible.
Support is at .8551/46, .8495/88, .8400, .8364/56, .8258, .8195, .8133, .8082 and .8067.
I'm having trouble with posting charts this morning so I'll post a chart later.
© 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.
In addition to breaking above an ascending triangle on the three-hour chart, the pair confirmed its double bottom when it rose above .8551. Some might say it's a triple bottom but there should be at least a few periods between two bottoms and the ones at .8067 and .8082 are more classic with eight days between them whereas the bottom of .8073 and .8067 only had two days between them. More is better in this case. Even eight days is not great but we'll take what we can get. These were both sharp bottoms rather than more rounded, gradual ones (which I prefer but it is what it is).
Now that it has been confirmed there is a price projection of .9035. Do I believe it? Does it matter whether I believe it or not? I'll just have to keep an eye on momentum. If it starts to falter, especially in the presence of other weakness (i.e. candle formations) and near resistance, then I'll probably at least lighten my long. As far as adding longs, I wasn't around when the pair broke above .8500 so I didn't add. At this point all I can do is add on pullbacks if that's what I want to do.
The pair is running into some resistance at its current levels where .8595 was identified last week as resistance. Tthe high this morning was .8614 so far and the pair is overbought (above 70 on RSI) on the shorter-term charts. More important resistance will rear up at .8707/28. This is 50% of the .92390 to .8067 move, polarity, and a fibonacci calculation of price target based on corrective wave behavior. If it can make it through there then the .9035 may look more feasible.
Support is at .8551/46, .8495/88, .8400, .8364/56, .8258, .8195, .8133, .8082 and .8067.
I'm having trouble with posting charts this morning so I'll post a chart later.
© 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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