Sir Pipsalot
Former FPA Special Consultant
- Messages
- 511
Hey folks,
Well, I've been highlighting this EUR/USD retracement for weeks now with a medium term long bias, but saying once we get to the 38% retrace around 1.4568 or so, it's time to start looking long term short. The sellers definitely were coming in big thinking the same thing around 1.4580, so I decided to get in short on multiple timeframes around 1.4570. After closing out the scalp/swing trades that had tighter SL's with some decent profits already, what still remains is the key position trade opportunity here.
If this trade works (i.e. a EUR/USD wave 2 or 4 has ended or is in the process of topping out), we should see at least 500 pips down and possibly even 1500 pips down from here. I have a specific system I use to scale in and out of position trades that I teach in the Profit Mongers room that works a lot better than a simple sell and hold approach, but either way you slice it, I think it's a pretty solid opportunity. I've chosen to give it plenty of room with a 300 pip SL, but that doesn't mean there aren't little opportunities here and there to take side trades with tighter SL's (like I mentioned above). Aside from the current highs today, the next areas of potential resistance are 1.4625 (Nov 2nd low) and the 1.4670-80 range (Dec 7th, 8th, 9th lows and 50% fib). The latter especially would be a good spot to sell IF we manage to get up there.
I haven't been commenting much on stocks recently because I don't see anything particularly clear there. The market feels very manipulated and wound up tight, so I'm waiting for a nice spark and signs of sustainable momentum before I look to trade a lot in equities. I do feel though that the New Year rally has fizzled a bit and I have a downwards bias for the next 1-2 weeks.
In news action Wednesday, we saw UK Industrial Production come out too close to expectations for a trade, but Aussie Employment and Unemployment both had nice positive surprises and led to a sharp 50+ pip AUD/USD rally as anticipated, but as I warned, most of that move comes very fast and hard on that particular report. In news Thursday:
0745 ECB Interest Rate Decision (no change at 1.00% unanimously expected) - There's never any statements released other than the change or no change to their rates, so there's just the longshot they surprise markets here.
If they hike rates at all, EUR/USD should rally 80 pips or more.
If they cut rates at all, EUR/USD should fall 80 pips or more.
0830 US Retail Sales X Autos (0.3% expected) - I believe we've now officially and fully moved into a price action phase where very good US news is broad based USD positive, and very bad US news is broad based USD negative in it's news trading type reaction. Remember, it used to be that US news primarily affected risk apptetite and drove yen crosses like EUR/JPY up and down which oftentimes made EUR/USD rally on good news and sell off on bad news. Around November of last year, this started changing and we've transistioned back to the old 2006-2007 mindset of USD reacting to US news as opposed to carry trades. With that in mind, I think the USD/JPY is a great pair to trade for a sharp, fast move, but the EUR/USD is more likely to push further and sustain a trend with a little patience. Specifically on this trade though, look out for conflicts with the Advance retail sales number (0.5% expected).
--If it comes out at 0.8% or higher, USD/JPY should rally 30-40 pips quickly, and EUR/USD should fall 40-50 pips perhaps a bit more slowly.
--If it comes out at -0.2% or lower, USD/JPY should fall 30-40 pips quickly, and EUR/USD should rally 40-50 pips perhaps a bit more slowly.
That's all for today's update. If you'd like to learn more about trading or trade along with myself and my collegues, come join us at Profit Mongers. Our subscription is very reasonable at $179 per month, and right now you can sign up for a 2 week trial to get started for only $29. This offer is for new customers only.
To our success!
Sir Pipsalot
Well, I've been highlighting this EUR/USD retracement for weeks now with a medium term long bias, but saying once we get to the 38% retrace around 1.4568 or so, it's time to start looking long term short. The sellers definitely were coming in big thinking the same thing around 1.4580, so I decided to get in short on multiple timeframes around 1.4570. After closing out the scalp/swing trades that had tighter SL's with some decent profits already, what still remains is the key position trade opportunity here.
If this trade works (i.e. a EUR/USD wave 2 or 4 has ended or is in the process of topping out), we should see at least 500 pips down and possibly even 1500 pips down from here. I have a specific system I use to scale in and out of position trades that I teach in the Profit Mongers room that works a lot better than a simple sell and hold approach, but either way you slice it, I think it's a pretty solid opportunity. I've chosen to give it plenty of room with a 300 pip SL, but that doesn't mean there aren't little opportunities here and there to take side trades with tighter SL's (like I mentioned above). Aside from the current highs today, the next areas of potential resistance are 1.4625 (Nov 2nd low) and the 1.4670-80 range (Dec 7th, 8th, 9th lows and 50% fib). The latter especially would be a good spot to sell IF we manage to get up there.
I haven't been commenting much on stocks recently because I don't see anything particularly clear there. The market feels very manipulated and wound up tight, so I'm waiting for a nice spark and signs of sustainable momentum before I look to trade a lot in equities. I do feel though that the New Year rally has fizzled a bit and I have a downwards bias for the next 1-2 weeks.
In news action Wednesday, we saw UK Industrial Production come out too close to expectations for a trade, but Aussie Employment and Unemployment both had nice positive surprises and led to a sharp 50+ pip AUD/USD rally as anticipated, but as I warned, most of that move comes very fast and hard on that particular report. In news Thursday:
0745 ECB Interest Rate Decision (no change at 1.00% unanimously expected) - There's never any statements released other than the change or no change to their rates, so there's just the longshot they surprise markets here.
If they hike rates at all, EUR/USD should rally 80 pips or more.
If they cut rates at all, EUR/USD should fall 80 pips or more.
0830 US Retail Sales X Autos (0.3% expected) - I believe we've now officially and fully moved into a price action phase where very good US news is broad based USD positive, and very bad US news is broad based USD negative in it's news trading type reaction. Remember, it used to be that US news primarily affected risk apptetite and drove yen crosses like EUR/JPY up and down which oftentimes made EUR/USD rally on good news and sell off on bad news. Around November of last year, this started changing and we've transistioned back to the old 2006-2007 mindset of USD reacting to US news as opposed to carry trades. With that in mind, I think the USD/JPY is a great pair to trade for a sharp, fast move, but the EUR/USD is more likely to push further and sustain a trend with a little patience. Specifically on this trade though, look out for conflicts with the Advance retail sales number (0.5% expected).
--If it comes out at 0.8% or higher, USD/JPY should rally 30-40 pips quickly, and EUR/USD should fall 40-50 pips perhaps a bit more slowly.
--If it comes out at -0.2% or lower, USD/JPY should fall 30-40 pips quickly, and EUR/USD should rally 40-50 pips perhaps a bit more slowly.
That's all for today's update. If you'd like to learn more about trading or trade along with myself and my collegues, come join us at Profit Mongers. Our subscription is very reasonable at $179 per month, and right now you can sign up for a 2 week trial to get started for only $29. This offer is for new customers only.
To our success!
Sir Pipsalot
