GBPCHF—rally

The pound based pairs in general are rallying and GBPCHF is no exception, coming off a low of 1.5790 yesterday to a high today, so far, of 1.6106. I bought at 1.6031 and the stop is better than breakeven. I also just took partial profits at +61 pips.

Most of the reason I bought is because it had come up to a resistance point with a strong candle and it was the 4th attempt at resistance. In addition, the pound has taken a beating lately and I thought a rally was in the cards. Finally, there was positive divergence on the three-hour chart that looked ready to work its way out.

I doubt this pair can get much past 1.6222/52 which is a fib retracement and price resistance. Before it does that it needs to clear 1.6131, the downtrend line coming in. It might be worth adding to the position if there's a pullback but if it seriously starts to falter, a reverse might also be in the cards.

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.

GBPCHF—bounced

After reaching a low of 1.6783 yesterday, the pair bounced up and appears to be heading back to 1.6927/52. I took partial profits at 1.6810 for +46 pips and the rest of the pair stopped out at +3 pips.

There are not a lot of clear hints as to where this pair may go next so I'm moving it to the back burner for now.

© 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.

GBPCHF—also dropping

The UK pairs are weak in general as though the UK has any more to worry about than Eurozone. I shorted this pair earlier today at 1.6856. It's currently caught in a small down-trending channel with a tiny 55-pip range (1.6833 to 88). It's also at the top of a much broader channel. The lower boundary on this is 1.6548. I've moved my stop to breakeven so let's see if it can tumble.

Support:

1.6833
1.6793
1.6734/52
1.6700/08

Resistance:

1.6888
1.6952
1.6994/1.7000

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.

GBPCHF—shorted at top of flag

I just took a short at 1.6893 because it’s at the top of the flag or downward channel on the three hour chart I posted earlier today. Obviously, I’ll move my stop to breakeven when I can. Also, if there's a good close above the flag, or better, a close above and return to the top of the flag, I'll reverse and go long (most likely).

© 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.

GBPCHF—may be bouncing

The pair has bounced a bit, as it seems wont to do. I’m still short from 1.6897. Earlier this morning I took some partial profits at 1.6784 for + 113 pips since it appeared to be climbing. The pair hasn’t been above 1.7037 this month. Remember that this trade was a pure range trade, ranging from 1.6118 to 1.7113 since mid-September. The low last week was 1.6734.

Resistance is at 1.6851 (.38 retracement from the low, 1.6888 (50% retracement), and 1.6931 (recent high). Support is at 1.6765 (this morning’s low), 1.6734 (last week’s low), and 1.6716 (polarity, which means it has served as both support and resistance).

The three-hour chart appears to have a bull flag formation (for the optimists) or a downward channel. The price projection from this is above 1.75, a psychological round number and polarity. A close above the flag line, around 1.6890 might be worth looking at for a long. On the other hand, shorts would be able to set a tight stop there. The decision will depend on price action at the time.

Here’s the 3-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.

GBPCHF—intransigence gives way, maybe

I’ve been watching this pair all week, thinking it’s time to short, it’s time to short. GBPCHF has remained intransigent in essence by my quite logical chart analysis. Finally, it looks as though the pair may be budging a bit. I shorted yesterday at 1.6897. It went a little underwater and then just sat there like a lump. I thought about closing it before I logged off last night but the house money effect kicked in (I’ve had great profits this week and figured I could afford the loss). This is not a good way to think and reflects the general fatigue I always feel as the week winds down. Regardless, the pair has finally started down but remember it had a paltry 139-pip drop earlier in the week before it rebounded.

Should she decide to continue her drop then the lovely, potential double top (it’s not a double top until price confirms it by going below the lowest point between the two tops) suggests a move to 1.5624. Groundskeeper, open the gates and let the wild dogs run (to paraphrase the Boss)! But as he goes on to sing in that song, “none of this has happened yet.” (Livin’ in the Future on the Magic CD). There’s a strong daily uptrend line coming in at 1.6374 and 1.6325 is the trough line of the potential double top. (12/16/08 at 1.7026; 1/20 at 1.7037; low point between was 1.6325). Those price points are far more likely and I, for one, will be happy if the pair goes anywhere near there. As I wrote yesterday, this is nothing but a range trade, pure and simple.

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.

GBPCHF—climbing again

GBPCHF is rising again in step with the pound improving. My short is out at breakeven. The reaction was a trifle, dropping a mere 139 pips to a low of 1.6898. Compare this to the 722 pips it gained since the January 10 low of 1.6315. It looks like it was just enough to relieve the overbought before going on to rise some more. A break of 7037 might be positive for a long although I’d assess price action carefully here before doing so. A definitive break below 1.6880 might augur well for a short. Maybe this; maybe that. This is a watch and wait pair at the moment.

© 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.

GBPCHF—faltered at resistance

This pair fell back from its high of 1.7037 yesterday and I wrote then that since it had been in a range of 1.6118 to 1.7113 since mid-September, this was an area to watch for shorts. It has faltered and I closed my long this morning at 1.6965 for +223 pips. I then took a short position at 1.6958. I have just moved my stop to breakeven when it dropped 40 pips.

This is simply a range trade, selling at or near (in this case) the top of the range. The march of candles up still looks bullish to me (not a lot of upper shadows on them, just resolute white candles). This little pullback could only be relieving the overbought pressure so we’ll have to see if this reaction has any legs. A close below 1.6880 would be encouraging.

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.

GBPCHF—Maybe another short coming up

The market is largely in the doldrums ahead of NFP today. As though that will make a big difference but everybody seems to be a tad nervous over what to do next so it’s as good an excuse as any..

GBPCHF is a pair I trade on and off and yesterday it looked as though it was ready to drift upwards again so I went long at 1.6568. The trade is up 80 pips this morning and I took partial profits. It looks as though it may be moving back to resistance at 1.6690 where it may prove to be another short. Depending on how you calculate your Fib levels (and I don’t always run mine off the extreme highs and lows), the 1.67 area is also .382 retracement from the November highs. This level is also polarity (it has served as prior support and resistance). If it does close above it, after the brouhaha that may take place around NFP, additional resistance is at 1.6785, 1.6990, and 1.7103. Support lies at 1.6530 and 1.6468.

Much will depend on price and RSI behavior as to whether it proves to be a good short. When I say price, I mean to look at such things as candle behavior. For example, if the candles start displaying upper shadows and small bodies, it can be a clue that the market is rejecting higher prices. This isn’t always true but at resistance, one can be a bit more confident. With RSI, it’s interesting to watch if the indicator moves into an overbought condition and is dropping out of that or if it fails to achieve 62.2 (the high prior to this).

You need to exercise great caution when trading around major news events such as NFP. I normally avoid trading because the markets can be volatile for no good reason. Here’s the three-hour chart:



© Dianne Fecteau, 2009. 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.