Tagged "channel"

7-16-08

1:49a GMT – Bad news for the US stock market, real estate industry and the economy in general have sent the USD sharply down across the board, blowing out stops across the currency pairs. The GBP/USD was no exception and we have seen the cable advance over 300 pips against the greenback. News for the British economy is not great either as they look to balance inflation with slowing growth and at a minimum I am looking for the pair to consolidate gains in the coming days as it crashes off the channel resistance (top red line below). The RSI also just recently crossed back from overbought (70) on the 4H.

Trading Idea: Short positions below 2.0175 are favored with targets at 2.0085, 2.0000, 1.9935 and 1.9850.

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7-3-08

14:43 GMT – Caution is advised as the EUR/USD approaches multi-day trend support due to mixed reactions to the ECB rate hike. Fundies have pushed the pair down on comments from Trichet that rate increases are done. However, US has a host of bad data about its economy and will not look to hike rates until end of year. I expect pair to rebound some, if not all. However, extreme market volatility may make this pair behave strangely.

Trading Idea: trend support is currently between 1.5700 and 1.5675. Long targets at 1.5735, 1.5815 and 1.5840.

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6-27-08

15:48 GMT – EUR/USD looks poised to make more gains, though I expect a slight dip to shake off the oversold levels on the houries and make room for another rally.

Trading Idea: Look for support to hold around 1.5675 and enter long on a bullish reversal candlestick. If support is broken with no signal look for channel support around 1.5610 to hold. Targets at 1.5740 and 1.5795.

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6-18-08

17:29 GMT – USD/CHF has been bouncing off support currently around 1.0370 for days now and I am looking for another bounce around this area. Ultimately the pair is short term bullish unless it closes below 1.0300, the next strong support.

Trading Idea: Look for a bullish reversal candlestick to confirm the long trade with targets at 1.0400, 1.0450 and 1.0495. If 1.0370 is broken look for a test of 1.0350 and 1.0300.

UPDATE – Pair did rise over 150 pips in my support area (see chart below). I did not enter any trade, unfortunately, because I did not see a clear bullish reversal candlestick on either the 1H or 4H charts. You gotta follow the system even if it means missing on on trades like this!

Result: +150 pips

Piphut: No trade

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6-15-08

00:36a GMT – AUD/USD has dropped considerably over the past few weeks and I am looking for more of a drop in the coming week as the pair enters a range between .9315 and .9415. Current resistance is around .9415 and we could see a rise to that before another fall.

Trading Idea: On a bearish reversal candlestick short targets will be .9370, .9345 and .9330. If resistance is broken look for a return to a wider channel top at .9475 or .9500.

UPDATE: No bearish reversal candlestick signal was seen on the H1 or H4 charts so no trade was entered. Good thing too because pair rose over 100 pips.

RESULT: no trade

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6-6-08

00:55 GMT – … must come down. Except in the Forex world ;). However, with AUD/USD approaching solid resistance and overbought hourlies we have a decent chart setup. In the long term I expect the AUD/USD to break the 1.9660 resistance and confirm the uptrend (until the situation in the US turns around or the Australian economy plummets) but in the short- to mid-term I expect the pair to drop back down to channel support. Trend resistance is currently at 0.9630 with intermediate resistance around .9615.

Trading Idea: Enter short on a bearish candlestick close to .9625 resistance with targets at .9585, .9545 and .9515. Stops should be above .9640. If resistance is clearly broken look for some consolidation and then a test of .9660.

UPDATE – 5:27a GMT 6-6-08 – pair is consolidating its gains underneath the .9615 support currently. No bearish sell signal yet, and not close enough to resistance for my taste.

UPDATE – 16:58 MT 6-6-08 – pair never got close to the .9625 resistance, though did start to fall this morning before bad US NFP data sent the dollar plummeting and our resistance line was broken with no bearish signal.

Result: 0 pips

Analysis: Good no trade, though this was a very solid chart setup.

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6-4-08

19:39 GMT – USD/JPY is approaching resistance currently around 105.50. Technically I expect the pair to bounce off this resistance. RSI also shows the pair approaching its trendline but is nowhere near severely oversold leaving the risk of a breakout.

Trading Idea: Look for bearish candlestick around 105.5 to confirm reversal and short for targets at 105.10 and 104.75. Channel could extend all the way down to 104.30. If resistance is broken look for a challenge of 105.75.

UPDATE – 00:01 GMT 6-6-08 – Pair charged through resistance and nearly broke 107.00 before coming back down to a 106-105.5 range. No bearish candlestick confirmed trade so no trade was entered.

Result: 0 pips.

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6-4-08

18:12 GMT – AUD/USD has been caught in a bearish channel beginning on 5/18 and I expect trend resistance currently at 1.9630 to hold and repel any stabs upward. RSI also crashed off its bearish channel resistance (near 70) and pair appears to be reversing down. I expect the the pair to encounter firm support around .9550 and would cover any bounce off of this until the charts give us a directional bias at that level.

Trading Idea: Wait for bearish candlestick to confirm trend reversal and enter short around .9620 with targets at .9675 and .9660.

UPDATE – 21:36 GMT – both targets hit for 65 pips. Will enter short again if pair breaks .9550.

Result: +65 pips

Analysis: Good trade. At the same time a single long wick touched resistance the pair also hit 70 AND RSI resistance and then began a bearish RSI divergence.

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6-3-08

19:08 GMT – AUD/USD got heavily sold off thanks in large part to the Fed’s comments about not letting the dollar get too weak. In the short-term, especially with the Dow still struggling to hold any gains I see support at .9510 holding strong against any attempts to break through it. There is also an RSI divergence on the 60M charts further supporting bulls for more gains.

Trading Idea: Long above .9510 with targets at .9540, .9570 and .95610.

Update: AUD/USD has made a clear break of .9510 without giving a bullish reversal candlestick above .9510. Signal is cancelled and we will look to sell on rallies.

Signal Review:  Got the bounce right just the placement wrong. Pair has made lower highs and lower lows for past few days and trend lines on below chart shows it is caught in a bearish channel. Missed that one. The bearish doji above support would have provided a nice entry point as well before a 90+ (so far) pip rise.

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6-1-08

23:50 GMT – The uptrend in the mid-term remains intact (though the daily downtrend is still technically intact as well). I am looking to buy dips, preferably down to stronger support at 105.00 but I will also look for a strong bullish candlestick on a test of the trending support line currently around 105.25.

Trading Idea: Look to buy dips as long as support level at 104.90 is not broken. Long short term targets are 105.3 and 105.7 with a test of 106 in sight. If support is broken look for further downside to 104.7 and 104.3

UPDATE – USD/JPY, like most dollar pairs today, smashed through support levels. There was no bullish entry signal so no trade was entered. Good no trade. Will look for selling opportunities on rallies.

Result: 0 pips

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