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3-3-10

5:14a GMT -Yesterday’s primary trade, a sell off of 1.3580 held on the initial touch to put pips in our pockets but bulls eventually bullied (you like that? :) there way back up to 1.3650. In all it was a very volatile day with 6-8 candles over 50 pips in length alone. This increase in volatility actually steers me toward a ranging forecast, however, as volatility usually tightens before a major *pop*, like the quiet before a storm.

Daily Outlook: 1.3450 support has been tested three times on three separate days and has held firm each time. Firm might actually be an understatement – every time the support has been touched the pair has raced upward 200 pips! More concerning for the bears though is the two massive dojis on the weekly chart with the now forming bullish hammer. Each time that support holds it makes a retracement more likely as bears may decide to wait for a better entry price higher up as I am now doing. Last hour we had a shooting star on the 1h near 1.3650 resistance but I no longer feel great about getting a good risk/reward from this level so I will hold off, waiting for a shorting opportunity closer to 1.3700.

Trading Idea: Still looking to short as the primary trade, with candlestick confirmation int he 1.3700 area. Targets at 1.3675, 1.3650, 1.3615 and 1.3580. The battle at 1.3580 will be interesting though, and aggressive bull traders will be looking for longs in this 1.3580-1.3550 on a retracement.

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3-1-10

6:14a GMT – Happy March PipHutters! Time really does seem to fly these days. I was trying not to enter the markets last Friday – end of week, end of month, Greek crisis all added up to more risk than I generally tolerate. So I listed my (preferred) conservative trade as being in the 1.3650-1.3700 resistance zone WITH candlestick confirmation on top of it. I didn’t expect either condition to be hit but with 5 hours left to go in Friday trading we saw a 100 pip bullish move into the conservative territory, capped by a bearish shooting star at 16:30 that popped up on the candlestick alerts (30m). Long story short I took the short position knowing my losses would be limited with 1.3700 capping potential gains and gained a quick 50 pips on the signal going into the weekend.

Daily Outlook: Double-doji on the weekly chart is enough to give me pause. A break above 1.3700 would be a bullish sign for further correction up to 1.3850 and higher (1.42 territory). Fundamentally traders are weighing the bad news in Europe (the Greek problem – and Portugal, Spain and Italy looming) against bad news in the US (soft housing data, unemployment, etc) and trying to figure out how much risk they are willing to tolerate. In the short-term the Greek fallout has really shaken traders and I think that will trump US concerns (meaning USD strength). Technically I will remain bearish under 1.3700 and will look to take another short in that vicinity.

Trading Idea: Looking for short with candlestick confirmation in the 1.3700 vicinity. Short targets at 1.3675, 1.3650, 1.3615 and 1.3585. A sustain break above 1.3700 immediately puts 1.3750 and 1.3790 in my sights.

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2-23-10

3:20a GMT – Watching the forex markets yesterday was about as exciting as watching paint dry. I had three open trades ( none on the EUR/USD signal) all day that hardly moved. Apparently market participants thought the pair had achieved a fair value for the time being and we had equal amounts buying/selling to keep the pair in the tight 1.3650-1.3580 range.

Daily Outlook: Given that nothing has actually changed since yesterday, and 1.3650 held for the second time in 2 weeks I am still looking to sell with the trend as my primary trade. 1.3650 will provide my first resistance level and the falling trend line as my second. We do have the German confidence sentiment being released around 09:00 gmt, so be weary of that (higher than estimated confidence is generally taken as Euro positive – more on that at the forex calendar).

Trading Idea: Primary trade is a short from 1.3650 (with candlestick confirmation) with targets at 1.3620, 1.3585 and 1.3555. The falling trend resistance will provide a nice place to hide my stop-loss. Secondary trade is to look for a false breakout above 1.3650 to be capped by the falling trend resistance (currently at1.3680). Finally a break above 1.3700 should  produce a challenge of 1.3790 and a break below 1.3580 should open up 1.3545 and 1.3450.

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12-28-09

6:14a GMT – I hope everyone had a relaxing few days off last week! This is generally the slowest week of the year before the New Year, and I know many of you are still out for the week on vacation, but the markets are open so the signals will continue! We finally saw a breath of life out of the bulls last week as the EURUSD managed to close on a high note, climbing above 1.4400 and almost piercing the 23.6% fibonacci retracement resistance from 12/3-12/22 at 1.4330. Price also managed to break the downtrend resistance we’ve had since December 3rd.

Daily Outlook: So what does this all mean? Well, if we were in a long-term downtrend for all of 2009 I would let this go and continue selling, but given the thin markets and the fact that we have actually been in a strong uptrend all of 2009 these are enough bullish signals to make me a believer – I looking to buy on dips today.

Trading Idea: I’m looking first for bullish signals near support at 1.4320 and, if that gets broken, I’ll look above 1.4275. From 1.4275 targets are 1.4315, 1.4345, 1.4390 and 1.4420. Make sure to keep an eye out for candlestick signals here to confirm the trade.

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No signals for today (Dec 24) or tomorrow (Dec 25) as Christmas has closed US Banks. Signals will be back on Monday, December 28th. See you then and happy holidays!

12-18-09

5:14a GMT – Before today’s signal I want to say something quick about patience. As you all probably know I talk about NOT trading about as much as I talk about trading. About waiting for a good pullback to buy/sell on, about waiting for confirmation, and about not minding if I miss a trade because there will always be another one. It’s one of the hardest things to learn in becoming a trader but I think the most important. I’m going to write a full article on it this weekend but until then please 30 seconds and read this post by James in the forum on Patience and Trading here. Feel free to share your own thoughts and stories (reply to the forum please) so we can all grow as a community.

On to the signal! Markets will probably be thin today due to it being Friday and so close to the holidays. We’ve definitely seen the end-of-year increase in volatility that many of us were expecting, and Friday’s can make it even worse. As always use stops and good money management. No entry on yesterday’s sell signal as the price dropped like a rock and never looked back. Mind the news event at 9a GMT – details on the forex calendar.

Daily Outlook: Short-term trend is obviously still bearish, and we have a short-term resistance in place at 1.4420 that should provide a good guide as to the direction of the pair on the day. 1.4420 is the 38.2% retracement of Wednesday’s high and Thursday’s low and has been twice tested (7:00 and 14:00 yesterday).

Trading Idea: Below 1.4425 I am bearish. For the day I will look for a bearish confirmation signal (candlestick, failure, etc.) to enter on with short targets at 1.4390, 1.4355 1.4320 and 1.4290. If 1.4425 is broken to the upside look for a re-challenge of 1.4500.

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12-14-09

5:01a GMT – Do you remember my post a few months ago entitled “Who uses PipHut?”? It was basically a breakdown of the various countries where PipHut is the most popular. However, as I found out last week there was one whole continent that was not being properly accounted for – Antarctica! I know PipHut has only gotten more popular since that post but last Friday when a PipHutter named Tenkis commented that he was stationed near the South Pole and was a daily follower of the site even I was shocked! To prove it, Tenkis took a picture of himself in Antarctica and uploaded it to the forum under the topic “World PipHut” – click here to view it! Very cool! I would also encourage any piphutters around the globe to upload a pic of themselves with some sort of PipHut printout as well!

On to today’s signal..

Great week for signals last week as the last three have been spot on, complete with nice candlestick signals on multiple timeframes to confirm the trades. Coming into this week the picture is much less clear fundamentally as Dubai has shown progress that they will not default on their loans, many of which are Euro-based. This sort of government-financed security fuels risk-appetite like kerosene on a fire, which would mean positive gains for the EURUSD.

Daily Outlook: However, besides the potential for the pair being oversold, the short-term technical picture for the EUR/USD could hardly have a more bearish trend at the moment, and therefore I am still (cautiously) looking for opportunities to sell the pair on. The pair has broken rising trend support after support recently, the most recent being the lower blue trend line on the chart below (connecting the 12/9-12/10 lows).

Trading Idea: Looking for selling opportunities near former rising trend support (now resistance) just above 1.4700 (which is also the 61.8% fib of Friday’s big drop). Because fundamental signals are mixed I will definitely wait for a candlestick confirmation before entering. Targets from 1.4700 are 1.4670, 1.4640, and 1.4605.

(click to enlarge)

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12-11-09

4:28a GMT – Another picture perfect signal yesterday as the price just kissed our resistance at 1.4750 after the news passed and then formed a shooting star on both the 30m and 1h charts. I know many of you profited off this but unfortunately I was outside shoveling myself out of 40+ cm (15 inches) of snow and missed the signal.

Daily Outlook: This week we have seen a major bearish break of daily support, a quick drop and currently the pair is consolidating in a triangular wedge patter. In general this type of pattern is a consolidation pattern – meaning it is a bearish signal because the preceding flag is bearish. As such I am biased toward the downside. It is the end of the week and we do have some news tomorrow (EUR Trichet speaks at 12:15, USD retail data at 13:30) – all of which can increase volatility. I expect one of the news events to push us out of this wedge pattern.

Trading Idea: 1.4775 is the key bearish resistance level – as long as this holds I will remain bearish on the pair. If the wedge is broken to the upside I will look for signals to sell below this level. If the bottom of the wedge is broken (currently around 1.4700) that opens a challenge of 1.4665, 1.4635 and 1.4600. Short targets from 1.4775 are 1.4745, 1.4710 and 1.4670. If 1.4775 is broken to the upside it puts 1.4850 back into play as a long target.

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11-20-09

6:00a GMT – Entry yesterday was never reached around 1.4950 as the pair continued to consolidate in an ever-tightening triangle consolidation pattern. We did have a few good candlesticks yesterday on the 30m and 1h that yielded good pips if you had your eyes open for them. The triangular consolidation pattern is taking place within the medium-term bear channel, which is taken place within the long-term bull channel. Confused yet? Just another day in the forex markets.

Daily Outlook: In the short-term I will look for range opportunities in the triangular consolidation with a definite leaning towards bearish trades and selling on rallies. I will look for bearish candlesticks to confirm, and look for entries around 1.4950-1.4980 resistance.

Trading Idea: Shorts preferred. From 1.4980 resistance targets are 1.4950, 1.4915, 1.4880.

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11-12-09

6:26a GMT – No entry on yesterday’s signal around 1.4930 as the pair once again bounced off of 1.4955 support before rising for a quick 60 pips. The pair entered this 1.4950-1.5050 range on 11/9/09 and has not been able to break free yet as investors try to decipher some of the confusing fundamentals that are coming out of the market. Technically the pair has been in a strong uptrend few days and past couple months, and on the daily chart we still have what looks like a bullish flag consolidation pattern so the bias is up. Therefor I will continue to look for buying opportunities at the range bottom around 1.4950.

Trading Idea: Looking for buying opportunities around range support at 1.4950 with targets at 1.4985, 1.5015 and 1.5045.

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