Pins and needles time for the Euro bears. I came with a few pips of being stopped out but my original short is still standing. Euro is trading within a very narrow triangle on the hourly chart and the definitive move when it comes is likely to be big.
No more blogging for me today. See you Monday.
Friday, October 1, 2010
EURUSD—update
I'm willing to risk a small short at this point and have entered at 1.3731 with a very tight stop. The risk is still there for a move into the 1.38 area. We'll just have to see how it goes.
© 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.
EURJPY—very near resistance
With a touch of 1.1452 this morning, the pair is getting very near to the potential selling price of 114.74 I've been blogging about this week. You can see on the daily chart below that price is within a rectangle reaching resistance. 115.14 is the upper channel line and there is fib confluence and polarity at 116.63. So if price gets through the 114.74 then it might be worth holding off a bit. Momentum looks good at the moment.
Don't be in a rush to get into trades. Even if some get away there are always more. If this pair continues up then 119.62 will be another selling opportunity. You can also try a long on a clean break of 114.74.
A move down could potentially see 1.0986 (50% of the most recent move up). Before that, though, the pair would find support at 113.41, 112.98, 111.97 and 110.66.
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.
Don't be in a rush to get into trades. Even if some get away there are always more. If this pair continues up then 119.62 will be another selling opportunity. You can also try a long on a clean break of 114.74.
A move down could potentially see 1.0986 (50% of the most recent move up). Before that, though, the pair would find support at 113.41, 112.98, 111.97 and 110.66.
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—near resistance
I'm still long from .8913.
Price is approaching prior resistance at .9734. Lots of traders are out there still waiting for it to return to its 2008 .9851 high. Looking at a graph of my brokers open orders it's clear that many are expecting a fall as well. It's considerably overbought and anyone not already long at this point needs to wait for a welcome correction. Support is at .9625, .9560, .9423, and .9358.
No chart as not much has changed.
© 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.
Price is approaching prior resistance at .9734. Lots of traders are out there still waiting for it to return to its 2008 .9851 high. Looking at a graph of my brokers open orders it's clear that many are expecting a fall as well. It's considerably overbought and anyone not already long at this point needs to wait for a welcome correction. Support is at .9625, .9560, .9423, and .9358.
No chart as not much has changed.
© 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.
EURGBP—rallying
I did re-enter with two long positions—one from .8582 and one from .8638. I just took partial profits on the first one at +96 pips. My price target is the same as before of .8732/46. This is fib confluence as well as the target for a pennant that formed on the daily chart. If the pair clearly closes above that then it's possible the psychological .9000 is next but it will battle tough resistance getting there.
It's easy to see why I re-entered. On the three hour chart the price dropped only to .8562, forming a nice hammer at polarity.
That said, I would not be surprised to see a bigger pullback, perhaps to the uptrend line at .8521. The candles on the three-hour chart are tentative at best. There's negative divergence with RSI. Prior key resistance was .8531. There's additional support at .8463 down to .8393/44. Below that things look rather grim. Let us remember there's a higher level overall downtrend in place.
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's easy to see why I re-entered. On the three hour chart the price dropped only to .8562, forming a nice hammer at polarity.
That said, I would not be surprised to see a bigger pullback, perhaps to the uptrend line at .8521. The candles on the three-hour chart are tentative at best. There's negative divergence with RSI. Prior key resistance was .8531. There's additional support at .8463 down to .8393/44. Below that things look rather grim. Let us remember there's a higher level overall downtrend in place.
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—approaching strong resistance
Euro has continued up. I've been blogging this week that I'd short around 1.30 or so and it has achieved that this morning in what looks as though is going to be a strong candle on the three-hour chart. So I'm holding off a bit longer to the 1.3775 area. At that point price will be at an upper trend line formed from the ABC rally (using Elliott Wave guidelines) as well as near a strong resistance area on my point and figure (P&F) daily chart. There's price resistance from March. It will also be near the .618 retracement of the long move down from 1.5144 to 1.1877. It's not likely the pair can maintain its recent steep angle of ascent. On a minor—very minor given the Euro's short history—some traders believe that October is a weaker month for Euro. That said, there's additional room for movement into the 1.3860 area so there's risk and finding a tight stop will be a challenge.
Bottom line here is I'm still looking to short but I'm holding off a bit. Should Euro begin to fall then the first strong support is 1.3335. That would make sense given that's the last strong resistance and it would probably like to give it one more kiss before it takes on another upward march or plunges down into what will be chilly waters indeed.
As I mentioned above, Euro could push into the 1.38 zone without it meaning much. However, if the pair sails on up through that, I'll change my bias to long.
Here's a daily chart:
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
Bottom line here is I'm still looking to short but I'm holding off a bit. Should Euro begin to fall then the first strong support is 1.3335. That would make sense given that's the last strong resistance and it would probably like to give it one more kiss before it takes on another upward march or plunges down into what will be chilly waters indeed.
As I mentioned above, Euro could push into the 1.38 zone without it meaning much. However, if the pair sails on up through that, I'll change my bias to long.
Here's a daily chart:
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
GBPUSD—uncertain
It's difficult to tell what this little pullback was to a low of 1.5670. While Cable broke its short-term uptrend line, it didn't break it by much and the hammer that formed on the three-hour chart found support on a daily speed line. It has since climbed above the trend line again. The drop took place on the last day of the month—it might only mean there was profit-taking in play. The rise on the first, this morning, hints at that. I still have a daily bull flag I'm playing off of and this is likely an EW C wave that isn't quite complete. I also have price targets from my point and figure charts that are higher. All those things looks bullish and would normally have me in the long position.
However I'm not going to enter now. For one thing it's Friday and I don't like taking on new positions just before the weekend where I aggressively re-analyze my charts. For another, I don't like that yesterday's long position couldn't get any legs and I was stopped at breakeven. More important is the fact that there is tough resistance above. The pair failed yesterday morning at 1.5923 (below the early August resistance of 1.5998). I'd like to see how it behaves as it approaches that price level again. Finally, I've had great profits from this pair this month. Why throw them away while the pair dithers about uncertain if it's going up or down?
So I'll hold off for now and look at it again on Monday morning.
© 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.
However I'm not going to enter now. For one thing it's Friday and I don't like taking on new positions just before the weekend where I aggressively re-analyze my charts. For another, I don't like that yesterday's long position couldn't get any legs and I was stopped at breakeven. More important is the fact that there is tough resistance above. The pair failed yesterday morning at 1.5923 (below the early August resistance of 1.5998). I'd like to see how it behaves as it approaches that price level again. Finally, I've had great profits from this pair this month. Why throw them away while the pair dithers about uncertain if it's going up or down?
So I'll hold off for now and look at it again on Monday morning.
© 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.
Thursday, September 30, 2010
GBPUSD—update 2
GBPUSD—update 2
I just bought at 1.5704 because even though the pair dropped sharply this was near support and was polarity. This meant I could set a very tight stop. In addition, even though cable floundered at resistance, the uptrend, as it were, is still in force. That's a reason to buy dips. Finally, this may be a chance to work out the negative divergence.
Here's why you might not want to buy (and I go through this pro and con before every trade I make). There's a much larger degree downtrend in force. The price dropped just below the daily 10 simple moving average (currently 1.5729) which is not great and below short-term support. It also fell below the uptrend line of the channel. I can counter these warnings by speculating that on the last day of the month people might be taking profits and by seeing that the move below support is a small one. In addition, there was more upside possible than was achieved based on the corrective move in force.
Now we'll just have to wait and see. The profits I have from cable over the last week will more than offset any losses which is not a bad position to be in and, as I wrote above, any loss will be limited by the tight stop.
© 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 just bought at 1.5704 because even though the pair dropped sharply this was near support and was polarity. This meant I could set a very tight stop. In addition, even though cable floundered at resistance, the uptrend, as it were, is still in force. That's a reason to buy dips. Finally, this may be a chance to work out the negative divergence.
Here's why you might not want to buy (and I go through this pro and con before every trade I make). There's a much larger degree downtrend in force. The price dropped just below the daily 10 simple moving average (currently 1.5729) which is not great and below short-term support. It also fell below the uptrend line of the channel. I can counter these warnings by speculating that on the last day of the month people might be taking profits and by seeing that the move below support is a small one. In addition, there was more upside possible than was achieved based on the corrective move in force.
Now we'll just have to wait and see. The profits I have from cable over the last week will more than offset any losses which is not a bad position to be in and, as I wrote above, any loss will be limited by the tight stop.
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
GBPUSD—update
My long from 1.5562 was profit stopped at 1.5764 for +200 pips. Will have to watch closely to see if this is a correction or the start of something more serious.
© 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—eked up to 1.3684
Euro, in an excruciatingly slow grind upward, managed to achieve a high of 1.3684 this morning. So the trend is still up but it does appear to be running out of gas. As someone once said, you can't bunt it out of the park. Given some of the technical signals, given that historically the Euro has tended to rally in September and given that we're at the end of the month, it's time to take some profits if you're long and to possibly think about shorts.
As I wrote yesterday, the upper channel line is around 1.3750 and this is also near a calculation point for the Euro correction as well as polarity. There are also negative divergences popping up in various time frames.
I'm still looking to short and I hope to do so around 1.3730 or so.
No need for a chart as there isn't that much to show from yesterday's 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.
As I wrote yesterday, the upper channel line is around 1.3750 and this is also near a calculation point for the Euro correction as well as polarity. There are also negative divergences popping up in various time frames.
I'm still looking to short and I hope to do so around 1.3730 or so.
No need for a chart as there isn't that much to show from yesterday's chart.
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
GBPUSD—rallying to resistance
I'm still long from 1.5562. The pair has briskly risen but it's getting near a key resistance level—the 1.5998 high from August 6th and the 50% retracement of the move down from 1.7043 to 1.4228. As a result I just took another third of my trade off the table for +340 pips.
My original price target was the 1.5998 high so if it moves there and looks poised to go higher I'll probably add a position. More later on this pair.
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.
My original price target was the 1.5998 high so if it moves there and looks poised to go higher I'll probably add a position. More later on this pair.
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.
AUDUSD—stalling
I'm still long from .8913.
Alas, the world must continue to wait to see if the pair can achieve the .9851 high from 2008. Price has stalled with it still not making it above yesterday morning's high of .9730. It's considerably overbought and anyone looking for a long at this point needs to wait for a correction (which would be very welcome) or a clean break above .9750.
A .382 correction would drop it to around .9358 and if that doesn't hold as support then .9331 is just below. After that there's .9093 which is the bottom of the upward channel. If there's a break below that, watch out for moves back to the .8700 range. It's doubtful the bulls would give up easily and I will probably use any correction as an opportunity to add long positions.
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.
Alas, the world must continue to wait to see if the pair can achieve the .9851 high from 2008. Price has stalled with it still not making it above yesterday morning's high of .9730. It's considerably overbought and anyone looking for a long at this point needs to wait for a correction (which would be very welcome) or a clean break above .9750.
A .382 correction would drop it to around .9358 and if that doesn't hold as support then .9331 is just below. After that there's .9093 which is the bottom of the upward channel. If there's a break below that, watch out for moves back to the .8700 range. It's doubtful the bulls would give up easily and I will probably use any correction as an opportunity to add long positions.
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.
EURGBP—pullback
My two longs from.8497 and .8597 profit-stopped out in the pullback for +65 pips and breakeven respectively.
After reaching a high of .8645, it appears the negative divergence yesterday on the three-hour chart correctly told the story. Price dropped to .8562. During the pair's rally it overcame key resistance at .8531 so this move may be only a retest of that level. Additional support is at .8500, .8467, .8400 and .8383/74. Below .8374 would signal the renewal of the overall downtrend.
Given that the overall trend is down, faltering at minor resistance, and the fact that there are support levels well below where the pair is at now, I've held off re-entering a long position. If I do re-enter then my initial price target remains the same—this is .8732/46 which is fib confluence as well as the target for a pennant that formed on the daily chart. If the pair clearly closes above that then it's possible the psychological .9000 is next.
No chart as there's not that much new to show.
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
After reaching a high of .8645, it appears the negative divergence yesterday on the three-hour chart correctly told the story. Price dropped to .8562. During the pair's rally it overcame key resistance at .8531 so this move may be only a retest of that level. Additional support is at .8500, .8467, .8400 and .8383/74. Below .8374 would signal the renewal of the overall downtrend.
Given that the overall trend is down, faltering at minor resistance, and the fact that there are support levels well below where the pair is at now, I've held off re-entering a long position. If I do re-enter then my initial price target remains the same—this is .8732/46 which is fib confluence as well as the target for a pennant that formed on the daily chart. If the pair clearly closes above that then it's possible the psychological .9000 is next.
No chart as there's not that much new to show.
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
EURJPY—another try at resistance
I wrote yesterday that this pair was a potential sell around 114.74. It hasn't gotten there yet—after reaching 114.22 the pair fell back to 112.98. It now looks as though it's going to try again. You can see on the three-hour chart that price is so far confined within a upward channel. The upper channel line is coming in near resistance of 114.74 so that will make this a tough price level to break through. Using Elliott Wave (EW) theory, one could also make a case that any correction would end around 115. However if one sells at that level one needs a tight stop. The correction could target higher prices and if it breaks through the 114.74 resistance then there isn't much real resistance before 119.62. Certainly 119.62 would be a selling opportunity. However, if short. one would probably want to reverse and buy if it breaks 114.74.
There's negative divergence on the three-hour chart. Divergence is all over the place which means less on any given individual pair or more that the market is getting ready to change.
A correction downward could potentially see 1.0986 (50% of the most recent move up). Before that, though, the pair would find support at 113.00, 112.68 and 111.97.
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.
There's negative divergence on the three-hour chart. Divergence is all over the place which means less on any given individual pair or more that the market is getting ready to change.
A correction downward could potentially see 1.0986 (50% of the most recent move up). Before that, though, the pair would find support at 113.00, 112.68 and 111.97.
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.
Wednesday, September 29, 2010
EURJPY—potential sell
There's an energetic rally going on in many pairs right now but a look at the daily EURJPY chart shows it's near resistance thus hinting at a potential short around 114.74. It may only correct but it's not unreasonable to think 1.0986 (50% of the most recent move up) would hold which would make for a nice profit from a short. If it breaks decisively through the 114.74 resistance then there isn't much real resistance before 119.62 so you want a tight stop on any short with probably a stop and reverse.
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.
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.
EURGBP—nice rally
EURGBP has continued to move up nicely, finding a high of .8618 so far today. This is well above the key resistance at .8531.
I'm still long from .8497 and I added another long position at .8597.
My initial price target is .8732/46 which is fib confluence as well as the target for a pennant that formed on the daily chart. If the pair clearly closes above that then it's possible the psychological .9000 is next. Corrections should find support at .8532, .8467, .8400 and .8383/74. Below that would signal the end of this rally and the larger downtrend would resume.
It's worth noting that on the three-hour chart below there is negative divergence between RSI and price. Not unusual these days but the pair may need to resolve it before going higher.
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'm still long from .8497 and I added another long position at .8597.
My initial price target is .8732/46 which is fib confluence as well as the target for a pennant that formed on the daily chart. If the pair clearly closes above that then it's possible the psychological .9000 is next. Corrections should find support at .8532, .8467, .8400 and .8383/74. Below that would signal the end of this rally and the larger downtrend would resume.
It's worth noting that on the three-hour chart below there is negative divergence between RSI and price. Not unusual these days but the pair may need to resolve it before going higher.
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—correction is a buy opp
I'm still long from .8913. This pair continues to spiral higher with a high this morning of .9730. It's faltering a bit, certainly understandable after its meteoric rise over the past five weeks. As I wrote yesterday, expect stalling around .9750.
A .382 correction would drop it to around .9358 and if that doesn't hold as support then .9331 is just below. After that there's .9092. Only if the pair broke below .9092 would I think the pair might see lows in the .8700 range. However that's probably not going to happen, particularly if gold continues up. I will probably use any correction as an opportunity to add long positions. Meanwhile, there's little evidence the pair isn't still on track to the 2008 .9851 high.
No chart as there's really not that much to show.
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
A .382 correction would drop it to around .9358 and if that doesn't hold as support then .9331 is just below. After that there's .9092. Only if the pair broke below .9092 would I think the pair might see lows in the .8700 range. However that's probably not going to happen, particularly if gold continues up. I will probably use any correction as an opportunity to add long positions. Meanwhile, there's little evidence the pair isn't still on track to the 2008 .9851 high.
No chart as there's really not that much to show.
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
EURUSD—rally getting to risky levels
The Euro has made another new high of 1.3638. However one can make an argument that this rally is getting old and the risk for new longs is becoming higher.
Yesterday, I pointed out that drawing a line in parallel with the uptrend line on the weekly chart implies a high of 1.3726 before correcting downwards. I've drawn it on the daily chart below as well. This is an Elliott Wave (EW) approach to estimating where an ABC correction ends. (Frost and Prechter, 2005).
First, you draw a line connecting the beginning of wave A (1.1892) to the end of wave B (1.2588). Then you draw a parallel line that starts at the end of wave A (1.3335). As Frost and Prechter (2005) write, "Wave C often ends upon reaching" this parallel line (p.89). The end point is now around 1.3750.
Another interesting thing about the daily chart is that there appears to be an ending diagonal that ends about that same point. When a corrective wave contains an ending diagonal it's always in wave C or a zigzag or flat.
Finally, note on the daily chart that Euro is overbought (over 70 on the RSI indicator). This is normal in third waves and a C wave is a third wave.
Can I validate the price target of 1.3750 in another way besides using EW theory? Yes. 1.3750 is polarity (i.e. the March, 2009 high and the June, 2009 low) although there's really a polarity zone that extends up to 1.3850. There's other evidence prices could extend to the 1.3850 area. This is approximately 50% of the move from the 2002 low to the 2008 high and it's also polarity as I just mentioned.
Dropping down to shorter time frames (1- and 3-hour) suggest this rally is getting tired with their negative divergences.
All this suggests potential shorts being the way to go. The entry point is what's important here and of course a tight stop. In the face of a rally you have to be careful. Using EW theory, it's not unusual for wave C to be the same length as A. This would imply a top of 1.4030. Short covering if the pair got above 1.3850 would fuel this kind of rise.
The other issue is that Euro broke above good resistance in the 1.35 area. If price pulls back to this area then you'd want to take some profits if short. Others might try a long here although waiting to 1.3335 would be better. The point is that this will be an area where, regardless of future direction, you'll see some stalling.
I have one other concern about the Euro and this is that it broke above the top speed line (the faint pink line on the chart). However, while this is significant it's only one small piece of evidence that this could be part of a much bigger move up and little else validates it as of yet.
Bottom line for me is that I will probably try a short around 1.3720.
Here's the daily chart:
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
Yesterday, I pointed out that drawing a line in parallel with the uptrend line on the weekly chart implies a high of 1.3726 before correcting downwards. I've drawn it on the daily chart below as well. This is an Elliott Wave (EW) approach to estimating where an ABC correction ends. (Frost and Prechter, 2005).
First, you draw a line connecting the beginning of wave A (1.1892) to the end of wave B (1.2588). Then you draw a parallel line that starts at the end of wave A (1.3335). As Frost and Prechter (2005) write, "Wave C often ends upon reaching" this parallel line (p.89). The end point is now around 1.3750.
Another interesting thing about the daily chart is that there appears to be an ending diagonal that ends about that same point. When a corrective wave contains an ending diagonal it's always in wave C or a zigzag or flat.
Finally, note on the daily chart that Euro is overbought (over 70 on the RSI indicator). This is normal in third waves and a C wave is a third wave.
Can I validate the price target of 1.3750 in another way besides using EW theory? Yes. 1.3750 is polarity (i.e. the March, 2009 high and the June, 2009 low) although there's really a polarity zone that extends up to 1.3850. There's other evidence prices could extend to the 1.3850 area. This is approximately 50% of the move from the 2002 low to the 2008 high and it's also polarity as I just mentioned.
Dropping down to shorter time frames (1- and 3-hour) suggest this rally is getting tired with their negative divergences.
All this suggests potential shorts being the way to go. The entry point is what's important here and of course a tight stop. In the face of a rally you have to be careful. Using EW theory, it's not unusual for wave C to be the same length as A. This would imply a top of 1.4030. Short covering if the pair got above 1.3850 would fuel this kind of rise.
The other issue is that Euro broke above good resistance in the 1.35 area. If price pulls back to this area then you'd want to take some profits if short. Others might try a long here although waiting to 1.3335 would be better. The point is that this will be an area where, regardless of future direction, you'll see some stalling.
I have one other concern about the Euro and this is that it broke above the top speed line (the faint pink line on the chart). However, while this is significant it's only one small piece of evidence that this could be part of a much bigger move up and little else validates it as of yet.
Bottom line for me is that I will probably try a short around 1.3720.
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.
Tuesday, September 28, 2010
EURUSD—nice rally
After stalling earlier last week Euro has moved up smartly to a high of 1.3556. I had price targets of up to 1.3520 when I posted a week ago. Unfortunately I wasn't in on this move since I was away and didn't buy beforehand.
The weekly chart shows potential for further moves up, possibly to the dashed line I drew in parallel with the uptrend line, assuming an EW type of correction. This would imply a high of 1.3726 before correcting downwards. One could also calculate an EW correction of a C wave on the weekly chart as ranging from 1.3498 (C= .618 of A), 1.4071 (C=A) or 1.4998 (C=1.618 times A and at which the Euro bears would be deep underground).
However Euro is in a zone of heavy resistance in the 1.35 area and while Euro bulls are galloping about, the bears are in there selling which accounts for the stalling. I may try a short around 1.36 or before, depending on momentum behavior (as represented by RSI) on the hourly chart. There's negative divergence on that chart so if it continues with the new highs then it's a sell signal. However bearing in mind the weekly channel, one would of course want a tight stop. I'm definitely going short if the pair reaches 1.3720. As for going long, I'd try one on a pullback to 1.3335.
Support is at 1.3520, 1.3469, 1.3335, and 1.3229 (50% of the move down from 1.4581 to 1.3229). Below 1.3000 would be devastating. Resistance is 1.3556, 1.3600, 1.3692, and 1.3720.
Here's the weekly chart:
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
The weekly chart shows potential for further moves up, possibly to the dashed line I drew in parallel with the uptrend line, assuming an EW type of correction. This would imply a high of 1.3726 before correcting downwards. One could also calculate an EW correction of a C wave on the weekly chart as ranging from 1.3498 (C= .618 of A), 1.4071 (C=A) or 1.4998 (C=1.618 times A and at which the Euro bears would be deep underground).
However Euro is in a zone of heavy resistance in the 1.35 area and while Euro bulls are galloping about, the bears are in there selling which accounts for the stalling. I may try a short around 1.36 or before, depending on momentum behavior (as represented by RSI) on the hourly chart. There's negative divergence on that chart so if it continues with the new highs then it's a sell signal. However bearing in mind the weekly channel, one would of course want a tight stop. I'm definitely going short if the pair reaches 1.3720. As for going long, I'd try one on a pullback to 1.3335.
Support is at 1.3520, 1.3469, 1.3335, and 1.3229 (50% of the move down from 1.4581 to 1.3229). Below 1.3000 would be devastating. Resistance is 1.3556, 1.3600, 1.3692, and 1.3720.
Here's the weekly chart:
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
GBPUSD—additional note
I forgot to add to my last post that I added to my GBPUSD position at 1.5761 this morning. I just moved the stop to break even.
© 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.
GBPUSD—correcting
I bought last Tuesday at 1.5562 and the pair moved up nicely to a high of 1.5896. This morning it sharply reversed down to a low of 1.5719 which causes concern as it's lower than yesterday's low. I took partial profits at +200 pips this morning. 1.5655 should contain further drops. Below 1.5511 would show real weakness and the next real support would be 1.5287.
If you look at the weekly chart you can see Cable has had two bullish weeks with last Friday's close. You can also see it's at resistance so stalling here is no surprise. A clean break above the resistance line would target the 1.5998 high.
Here's the weekly chart. My trades don't show on this chart as I use a different charting package for longer than daily charts.
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
If you look at the weekly chart you can see Cable has had two bullish weeks with last Friday's close. You can also see it's at resistance so stalling here is no surprise. A clean break above the resistance line would target the 1.5998 high.
Here's the weekly chart. My trades don't show on this chart as I use a different charting package for longer than daily charts.
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
AUDUSD—possible correction
I'm still long from .8913. My long from .9386 profit-stopped out at +90 pips.
The pair has had five solid weeks of higher prices so I'd expect some correction at this point. The pair is overbought on the daily chart and there's negative divergence on the one- and three-hour charts. The top of the upward channel is .9671 and the pair stalled at a high of .9644. As a result I took some partial profits at +701 pips. This doesn't mean I don’t think the pair can achieve the former .9851 high. But it's not going to do so in a straight line up and I can add another position later. Meanwhile, I've taken some nice profits.
The thing to watch for now is another attack on the .9645. If this fails then there is a possibility the pair will pull back a bit more, possibly to .9509, .9463 or .9373/54. Much below that would signal the possibility of further moves down to .9093 and have the bears out in full force.
If the pair can successfully scale .9644 then it's probably on track for a return to the 2008 high of .9851. Expect more stalling at .9750.
Here's the daily chart:
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
The pair has had five solid weeks of higher prices so I'd expect some correction at this point. The pair is overbought on the daily chart and there's negative divergence on the one- and three-hour charts. The top of the upward channel is .9671 and the pair stalled at a high of .9644. As a result I took some partial profits at +701 pips. This doesn't mean I don’t think the pair can achieve the former .9851 high. But it's not going to do so in a straight line up and I can add another position later. Meanwhile, I've taken some nice profits.
The thing to watch for now is another attack on the .9645. If this fails then there is a possibility the pair will pull back a bit more, possibly to .9509, .9463 or .9373/54. Much below that would signal the possibility of further moves down to .9093 and have the bears out in full force.
If the pair can successfully scale .9644 then it's probably on track for a return to the 2008 high of .9851. Expect more stalling at .9750.
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.
EURGBP—may reach new highs
Early last week, before I escaped to the mountains of beautiful North Carolina for several days, I wrote that this pair appeared to be setting up for a potential short around .8531 since it was near resistance and in a general downtrend since March.
However the pair moved up in what turned out to be a strong weekly candle. It reached a high of .8578 which means it broke through key resistance at .8531. This price is near the 50% level of the move from March down to June. The pair then fell back to .8467 in what could be a three-wave correction on the three-hour chart. If this is true then wave C has been equal to wave A so far and one can make the case for additional moves up. What are some other signs there may be more upward price movement? On both my 3-hour and daily point and figure (P&F) charts, I have price targets of .9270 and .9100 respectively. On the three-hour chart I had a buy signal near .8550. Also on the three-hour chart, is a pennant with a potential price target of .8746. As a result of this I bought this morning at .8497. It almost immediately tried another thrust up. Let's see if it can make it.
The potential downside is that wave C could extend down to .8374. There's also a possibility this is a false breakout above .8531, something certainly not unknown in the Forex world. Additional downside probes to .8350 are possible but below that I'd assume the downward trend was resuming.
I haven't really had a chance to settle back into trading since I arrived home late last night. As a result, I've already moved my stop to breakeven.
Support is at .8467, .8430, .8374, .8350 and .8250. Resistance is at .8578/95, .8670, .8700, and .8808.
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.
However the pair moved up in what turned out to be a strong weekly candle. It reached a high of .8578 which means it broke through key resistance at .8531. This price is near the 50% level of the move from March down to June. The pair then fell back to .8467 in what could be a three-wave correction on the three-hour chart. If this is true then wave C has been equal to wave A so far and one can make the case for additional moves up. What are some other signs there may be more upward price movement? On both my 3-hour and daily point and figure (P&F) charts, I have price targets of .9270 and .9100 respectively. On the three-hour chart I had a buy signal near .8550. Also on the three-hour chart, is a pennant with a potential price target of .8746. As a result of this I bought this morning at .8497. It almost immediately tried another thrust up. Let's see if it can make it.
The potential downside is that wave C could extend down to .8374. There's also a possibility this is a false breakout above .8531, something certainly not unknown in the Forex world. Additional downside probes to .8350 are possible but below that I'd assume the downward trend was resuming.
I haven't really had a chance to settle back into trading since I arrived home late last night. As a result, I've already moved my stop to breakeven.
Support is at .8467, .8430, .8374, .8350 and .8250. Resistance is at .8578/95, .8670, .8700, and .8808.
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.
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