FOREX PRO Weekly May 02-06, 2011

[Sive Morten]

Hello Sive. Can you tell me if this is a correct context for B&B Buy if the bar closes above the 3x3? If so, is the target .618 of the whole move down? Or .618 of the most recent move down? Thank you for teaching.

Hi Icarus,
No, there is no context for B&B, because this is poor thrust down. Thrust should have minimum 8-10 thrusting bars, preferrably with no close above 3x3.
And here we have 4 bars down then 0.382 retracement and then again 3 bars down. You can take a look at daily NZD to see how perfect thrust should look like.

About the target -
Suppose, that we have good thrust down, and then retracement up when you're entered short. Your target - 0.618 support from this retracement up move, but not from the thrust, because you're entering in the same direction as a thrust - hence the target is below your entrly and not above.

Hope that helps

 

[Sive Morten]

EUR/USD Daily Update, Wed 04, May 2011

Good morning,
Market continues coiling in tight range and building an energy. On daily time frame only couple of moments that are worthy of our attention:
1. Target area is the same - 1.4950-1.50
2. Price action reminds those that was under 1.45 area. The major question - will market show downward breakout or not. And currently I do not see any clues on daily time frame. Tomorrow MACDP will come in play and if there will be stop grabber - it could give us more confidence. But looks like the major answer should come from lower time frames.

4-hour chart and hourly chart
Here our broadening top pattern turns to some kind of consolidation. The major level to watch is 1.46-1.4630 - pivot, Confluence support, 4h oversold and AB-CD target.
So, if you're bullish - try to enter Long here with tight stop - just below oversold at -1.4670 - 1.4675. Move stop to b/e as soon as possible.
If you're bearish - wait when market will move close to the top around 1.4680 and place stop somewhere above it.

The only safe trading way currently is to use tight stops and move them to b/e as soon as market will allow to do that.
On 4-hour chart currently Butterfly "Sell" is possible with the same target around 1.4950-1.50.

Currenlty market is coiling in the range - so we should trade it accordingly.
When we will see some prompts the help us to estimate breakout direction - we will act differently. I think we should get some clues tommorow or on Friday.

 

[eric lew]

Hi Sive,

Do you think it is a B&B formed on the daily chart for AUD/USD. Also, AUD has fallen by 300pips while euro is just 150pips.
i wonder if AUD rebound, it also means euro will bounce above 1.49

 

[Fernando Monera]

If you're bearish - wait when market will move close to the top around 1.4680 and place stop somewhere above it.

Do you mean 1.4880?

 

[pragmatic]

targets

Hi Sive!
Thank you for your annalisys, as always.
I wonder if you can emphasis the Targets, I mean where to put the TP. I noticed that you take great care of the stops. I suppose that is very important but please give us some explanations about how to put the TPs. Do we use the expansion target in higher time-frame, do we exit on the first target or wait for the next one? It is all blurry...
Thank you!

 

[Sive Morten]

Hi Sive,

Do you think it is a B&B formed on the daily chart for AUD/USD. Also, AUD has fallen by 300pips while euro is just 150pips.
i wonder if AUD rebound, it also means euro will bounce above 1.49

Hi Eric.
Yes, I suppose this environment is suitable for B&B. Concerning rebounding - I think that this is not quite right to make such links. Still EUR and AUD quite different currencies. But, if it will be due dollar weakness - then it is possible.

Do you mean 1.4880?

Hi Fernando,
sure, thanks

Hi Sive!
Thank you for your annalisys, as always.
I wonder if you can emphasis the Targets, I mean where to put the TP. I noticed that you take great care of the stops. I suppose that is very important but please give us some explanations about how to put the TPs. Do we use the expansion target in higher time-frame, do we exit on the first target or wait for the next one? It is all blurry...
Thank you!

Well, Our target currently is 1.4950-1.50 area at daily time frame. When market stands at overbought - better to exit at previous highs or take nearest extension targets - depends on what stands closer.

You should use targets according to your context time frame. For instance, If you ruled by 4-hour chart as context - then use targets based on 4-hour chart - extensions, some strong resistances etc. But you may use lower time frames, such as 30-min, to enter in trade.

 

[ALF]

"2. Price action reminds those that was under 1.45 area"....
Hi Sive,

What is this level - 1.45. As I remember, you mentioned this yesterday, also.

Please explain.

Thanks.

 

[Sive Morten]

"2. Price action reminds those that was under 1.45 area"....
Hi Sive,

What is this level - 1.45. As I remember, you mentioned this yesterday, also.

Please explain.

Thanks.

Hi Alf,
well, if you look at how market stands below 1.45 - you'll see very similar price action - tight range, some inside days. Market also has built an energy and the was plunge to the downside.
Currently it looks akin. The same range, the same intraday trading sessions. Be prepare for strong move...

 

[Icarus]

Hi Icarus,
No, there is no context for B&B, because this is poor thrust down. Thrust should have minimum 8-10 thrusting bars, preferrably with no close above 3x3.
And here we have 4 bars down then 0.382 retracement and then again 3 bars down. You can take a look at daily NZD to see how perfect thrust should look like.

About the target -
Suppose, that we have good thrust down, and then retracement up when you're entered short. Your target - 0.618 support from this retracement up move, but not from the thrust, because you're entering in the same direction as a thrust - hence the target is below your entrly and not above.

Hope that helps

Thank you.

 

[ALF]

Hi Alf,
well, if you look at how market stands below 1.45 - you'll see very similar price action - tight range, some inside days. Market also has built an energy and the was plunge to the downside.
Currently it looks akin. The same range, the same intraday trading sessions. Be prepare for strong move...

Thanks Sive

In this case, if we apply this chart’s similarity approach, the odds are for a breakdown move probability. Right?