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British Pound Forex Pro Weekly, September 20-24, 2010

Discussion in 'Sive Morten- Currencies and Gold Video Analysis' started by Sive Morten, Sep 18, 2010.

  1. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Monthly
    As we’ve estimated on the previous week, 1.35-1.40 area is a strong historical support, that includes major 5/8 support from a historical low in 1985. So, market has bounced from this level again, and this level of support holds market since 1992, when there was a first touch.
    Monthly trend is bullish now, so, the next bullish target is 61.8% expansion from ABC-bottom pattern that agrees with deep 0.786 Fib resistance level and just above this area – 1.6623 monthly overbought level. Normal price action suggest that market should bounce from there. Now we have quite different monthly scenarios for EUR and GBP, that confusing a bit. But technical picture suggest this kind of development. Besides, monthly trend on EUR is bearish. Anyway, context of possible move to 1.6422 stays intact until market will not break below C- point or shift trend.
    Monthly#1
    [​IMG]

    During the previous research, We’ve discuss the possibility of Butterfly “Buy” pattern. So, I draw it on the chart below. This is too early to speak about it, besides, there is one problem with this pattern – market should break 1.35-1.40 historical support area. But, if we assume 1.05 move on EUR due monthly Butterfly “Buy” pattern, why we can’t look at this scenario on GBP, right?
    Monthly#2
    [​IMG]

    So, currently I think that move to 1.6422 on a monthly time frame is possible. This assumption will be canceled if market will move below 1.4230 area and trend turns bearish. Around 1.6422 price action can turn to Butterfly formation or triangle. But it’s a bit early to talk about.

    Weekly
    As you remember, we’ve talked about upward momentum trade at weekly chart, so just remind you the context - weekly trend is still bullish, the green line on the chart – 3x3 Displaced Moving Average. Market has shown nice thrust up – 9 consecutive up bars, good separation from 3x3 DMA. Now market has reached strong Fib Confluence support 1.5321-1.5347 and shows 3 closes below 3x3 after penetration. All this stuff is a necessary context for momentum trade.
    The minimum target of this trade – 1.5729 area – 0.618 Fib resistance. Market has hit the target and pulled back. Based on weekly chart it’s difficult to say right now, should market continue up move or not, but trend is bullish, market has no overbought condition and just has reached Fib resistance, so we can count on some bounce. The nearest weekly support area – Confluence support around 1.5320-1.5350 – level, from which this up move has started.
    [​IMG]

    Daily
    Based on the daily chart I only can say, that we should expect some bounce to the downside. Market has reached Fib resistance level at 1.5717, shows Wash & Rinse and spike bar or Gravestone doji. It does not mean that this is a reversal to the downside, daily trend is bullish right now, but beginning of coming week can show a bearish bias.
    Daily#1
    [​IMG]

    4-hour
    The most important time frame currently, is 4-hour one. Look, the break out of daily channel has started from reverse H&S pattern, and the usual target of this pattern is 1.618 expansion, and market has not quite reached it. It was close… At the same time market has formed 4-hour RRT (Rail Road Tracks) pattern, a.k.a. “Rejection of price”, and usual target of this pattern – length of the bars of RRT - it’s about 118 pips. So, it’s target somewhere around 1.5480-1.55 level, that makes and Agreement with 1.5483 Fib support. That’s important, keep in mind this level. Ok, let’s go further…
    Now, take a look at support levels – the first Confluence support is 1.5602-1.5613 not interested me much, it just create small retracement for possibility to enter in RRT signal for those who has taken it. The more interesting level is 1.5546-1.5556. Like in EUR/USD – this is a Confluence support and weekly pivot point. It’s very strong support . Now important note – will not be confused with market move below this area. With definite circumstances this fact will not mean that market has reversed to the down side. It will mean that it just intends to accomplish RRT target at 1. 5483.
    So, look for price action around 1.5480-1.55 area. If market will reach it and then move above 1.5560 Confluence area - do not be short. At the same time I do not see any problem with the bearish scalp trade with the target around 1.55 area.
    [​IMG]

    That’s being said, long-term charts do not tell much about possible direction. At the same time 4-hour chart gives very much information for nearest couple of days of coming week. I expect that RRT pattern should work, i.e. market can reach 1.5480-1.55 area. If market will move and hold above 1.5660 area then – don’t be short, because this temporary breakout will be just a completion of RRT pattern.
    Also I do not see any problem in short term scalp trade, according with RRT target around 1.55 level.


    The technical portion of Sive's analysis owes a great deal to Joe DiNapoli's methods, and uses a number of Joe's proprietary indicators. Please note that Sive's analysis is his own view of the market and is not endorsed by Joe DiNapoli or any related companies.
     
  2. forexclues

    forexclues Private

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    just like you said

    The short term bearishness is now in place

    Although the market breached the 1.5660 area, it settled there but broke back to the downside (15M chart)

    I just hope the market gets to 1.5555 area...I think that place will be okay for me...

    Thanks.
     
  3. akalou

    akalou Private

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    right on point

    once again,you're just too good.thanks a lot for your wonderful analysis.pls would appreciate a similar daily update just like the EURUSD pair.
    thank you very much once again for your superb analysis.:)
     
  4. Sive Morten

    Sive Morten Special Consultant to the FPA

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    GBP/USD Daily Update, Tue 21, September 2010

    Good Morning Ladies and Gentlemen,

    Look's like our trading plan for Monday has worked well. So, now market has reached strong support 1.5530 area - Fib Confluence support and Agreement + weekly pivot. I expect that market should bounce to the upside.
    At the same time, I have strong expectation that market should reach 1.618 target around 1.5480 area, may be not today, but during current week. When market will reach this 1.5530 area of support for the second time -it will not be so strong...
    Today I do not expect any strong moves till FOMC meeting and can't exlude some ping-pong move in area between 1.5530 and one of the resistances at hourly chart - maybe 1.5620...
    Anyway, I think that EUR today has more interesting scenario.
     

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    #4 Sive Morten, Sep 21, 2010
    Last edited: Sep 22, 2010
  5. Sive Morten

    Sive Morten Special Consultant to the FPA

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    GBP/USD Daily Update, Wed 22, September 2010

    Good morning,
    Our trading plan for Mon-Tue has been achieved. First of all RRT pattern has reached it target around 1.55 and then returned back above weekly pivot and strong area of support 1.5630. That is what I've warned you about - market just has accomplished target of RRT pattern.
    So, currently, I think that GBP has not bad chances to take out Daily 0.618 Fib resistance area. It has touched it once already, when it will touch it again - this area will be weaker.
    Besides, look at 4-hour chart and ABC pattern - 0.618 target is just above the previous highs. And now try to emagine how will explode stops that had been placed there...
     

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  6. adams1

    adams1 Private

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    Thanks

    Hi Sive
    Good morning Sive,Sir I am grateful for the good work you are doing in our life.I pray that Jehovah should bless you in Jesus Christ name ..Amen.

    Thanks
    Adamson Erha
     
  7. Sive Morten

    Sive Morten Special Consultant to the FPA

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    GBP/USD Daily Update, Fri 24, September 2010

    Good morning,

    Our previous expectation was an establishing of a new highs, so, that has happened yesterday.

    Look at 4-hour chart. Currently, market is forming some clear bearish signals - divergence and wedge. But one thing worries me a bit. First, the target of daily ABC-bottom pattern just above the market - around 1.5667 area.
    Also, look, how the last high has been held by 1.27 expansion of retracement from previous high. This is one part of a puzzle, named as "three drive sell'. And the target of this pattern around 1.5775 area - precisely at daily 61.8 expansion target.
    Besides, market-makers know that huge amount of traders will take these bearish signals - divergence and wedge. Second, when they will move market above the previous highs, then breakout traders will enter on the long side. THis means that with 3-drive Sell pattern M-makers will get profit twice - they will clear stops of bearish traders, and then they will gather ones of break out traders. So, watch out...
     

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