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Euro Forex Pro Weekly, September 20-24, 2010

Discussion in 'Sive Morten- Currencies and Gold Video Analysis' started by Sive Morten, Sep 19, 2010.

  1. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Monthly
    Not much new on monthly time frame. Trend is bearish. During previous research I’ve marked 1.2550 area with horizon blue line – market often has found support or resistance around this level and now this happens again. The next monthly target is Agreement of 100% expansion of ABC pattern and 1.1394 Fib support (I do not have it on this chart). Now market consolidates in the range between 3/8 resistance area and 1.2550 long term support.
    Monthly#1
    [​IMG]

    Also we can see perfect 1.27 Butterfly Buy pattern with the target around 1.05. Another interesting moment is that 1.27 expansion of ABC-pattern almost precisely coincides with this level. But we should talk about it in more details if we will get 1.15 target first.
    Monthly#2
    [​IMG]

    Weekly
    Weekly trend is bullish, no oversold or overbought condition right now on the market. Let’s proceed with momentum trades, that we’ve talked about on previous week.
    1. Upward momentum trade.
    This momentum trade has been completed. Market has reached 0.618 resistance level at 1.3048 from whole reverse back move and even exceeded it a bit.
    Weekly#1
    [​IMG]

    2. Downward momentum trade
    Now, as you remember, we also have talked about larger momentum trade, that is to the downside. And context for this trade is a previous huge thrust down. The minimum target of this trade – 5/8 Fib support from the whole up move retracement from this swing down. Look at the picture.
    This trade is working still, but also has it’s own defects. First of all, I do not like too deep move after crossing of 3x3 DMA (green line) to the upside. But if we take into consideration the reason for the previous sell-off (EU and Greece problems), then, may be everything will be ok with this trade. Besides, the monthly trend supports the direction of this weekly signal. The level of cancellation of this trade – is a situation when market will exceed previous high at 1.3333. That’s important, because, although this is a Directional trade (Direction overrules trend), the weekly trend is still bullish, and from weekly chart we can’t say definitely will market surely go to the downside…
    Now some new details appear in this trade. If we assume that C-point already in place, then target of AB-CD pattern coincides with target of this momentum trade and makes and Agreement with 5/8 Fib support level at 1.2409-1.2430.
    Weekly#2
    [​IMG]

    Also, I would like to continue to track our possible butterfly that I’ve shown you on previous week.
    Weekly#3
    [​IMG]

    As I’ve said during the previous week, we can see some shallow changes that do not influence on the pattern hard. One of this possible changes could be moving of C-point higher than it was on a previous week and this has happened. Now we have two Agreements – 100% Expansion from ABC pattern agrees with 5/8 Fib support and this is really strong area, 127.2% expansion agrees with deeper Fib 0.786 support. Two strong support levels in a row can hold the market during down move and makes realization of butterfly pattern more probable.
    The major value of this possible butterfly ”Buy” pattern that it confirms monthly target – the 1.272 target of this butterfly – precisely at monthly Agreement area around 1.14-1.15.
    At the same time, this forecast has some critical points. First, we need, that AB-CD move will not break previous lows. So, the lows around 1.19 should hold. And, second, market should not move higher, than A point around 1.3333. It will be much better if upward retracement will be stopped by 0.786 resistance (almost like I draw it).

    Daily
    Here, I would like to show you couple of charts. And I concern with them a bit. Here is why… Look at the first chart – it shows that market has reached 1.618 butterfly “Sell” pattern and monthly pivot resistance 1. Look’s like reversal is logical, everything is ok. Now look at the second daily chart

    Daily#1
    [​IMG]

    Market has not quite reached 1.618 expansion target and Agreement at 1.3167 (just for some pips). Why does this fact so worry me? Well, usually, when market has not reached a bit solid target, it very often reaches it a bit later. Odds suggest that it happens very often. I just want to warn you about this moment and you should be careful in opening short positions. Because current move down may be just a reaction on overbought condition and resistance as of monthly pivot resistance 1. Besides, look at the speed of CD-leg. It much faster then AB move. So, when market will move out from overbought condition, some continuation of upward move, as I said, is possible. Other words I can’t exclude last gasp to the upside and reaching 1.618 expansion target, although for now it’s impossible to say – will it happen or not, because market just started move down.
    Daily#2
    [​IMG]

    4-Hour
    4-hour trend turns bearish, market already has reached first Confluence support at 1.3030-1.3035 area. Previous move up was solid, so I expect that market should show deep retracement to the upside – 1.31-1.3120 area. Next important area of support – Confluence support 1.2958-1.2962 and 1.2966 weekly pivot point. This can also be an Agreement of possible AB-CD down move. So, personally, I will be looking for price action around this area. If market will move below pivot and will stay here, it will increase chances for continuation to the downside and decrease ones of a possible move higher, at least during the next week. I will not enter short, if market will hold above pivot.
    [​IMG]

    That’s being said, during the next week the main question will market reach daily 1.618 expansion target or not. If market can anchor below pivot point then, I suppose, probability of reaching this target decreases, at least during the next week. Personally I will not enter short, if market will hold above pivot.

    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. Sentinel

    Sentinel Sergeant

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    Fundamentals

    Dear Sive,

    Thanks for the detailed analysis once again.

    I am aware that you introduced new crosses and it takes much much more time to analyse more than one crosses but you started skipping (or fast forwarding) the fundamentals. In older analysis, there was a detailed view of the current picture of the world economy and it helped me a lot in defining the strategies. There is no need to emphasize the importance of fundamentals as a matter of fact.

    I wanted to summarize that I prefer less crosses, more fundamentals.

    Cheers
     
  3. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Hi, Sentinel,
    well, the point is that most people here have relatively small accounts - some thousands of USD. And with account for example 5-20K$ just impossible to trade fundamentals.
    At the same time using of leverage leads to participation in relatively fast short-term trades with tight stops, that's why technical analysis is preferable here. I will do some fundamental notes, if they will be able to skew technical picture, but there is no much sense to prepear fundamentals on weekly basis.
     
  4. Richard Ortyl

    Richard Ortyl Recruit

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    Hi Sive now you are doing 3 pairs my preference would be for less analysis with focus on possible trade opportunities. I currently find it too much information with all the 3 pairs.
     
  5. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Hi Richard,
    well, there are equal amount of opinions as people ;) I can't satisfy all of your demands, guys. Try to use, what FPA provides to you, besides, this is absolutely free...

    P.S.
    Congrats on MU win yesterday. This was tremendous game btw...
    Or may be you're a MCity fan? In this case, I do not want to angry you much ;)
     
  6. Sive Morten

    Sive Morten Special Consultant to the FPA

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    EUR/USD Daily Update, Tue 21, September

    Good morning,
    recent price action makes me think, that market should reach 1.3160 area and the last target at 1.618 expansion from daily move and here is why.
    1. Look at daily chart and ABC-bottom pattern. Market has thrusted right to the 100% expansion through 61.8% without any retracement. Very often it means that market has solid chances to reach 1.618
    2. Market during 3 days has traded at overbought (blue line on the daily chart) and didn't even a bounce, just stays in the range.
    3. Yesterday's downmove on GBP has not been supported by EUR
    4. Market has not quite reach 1.618 just for few pips and now stays just below it. M-makers just wait, when there are a lot of stops will appear above the previous highs.

    Now let's talk about 4-hour chart. There is also single interesting moment. Trend turns bearish, but market stays in tight triangle consolidation and I have some suspicions that market can show upper break out, may be during today's FOMC meeting.
     

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  7. forexclues

    forexclues Private

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    Hurray to MU fans

    the 1.3125 has almost been reached...

    thanks to sive again

    hurray to man u fans...want a drink?;)
     
  8. Paata

    Paata Private

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    Hi Sive,

    What is the target by double RePo? Where to put limit order?

    Regards

    Paata
     
  9. Mandrake

    Mandrake Corporal

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    Hey Sive,

    May I ask you whether you trade Chinese Yuan ?

    I have been looking around for Chinese Yuan forex or futures since it started to move recently. I only found Oanda. It seems that they are the first forex broker to introduce CNY/USD exotic pair; but the spread is a killer at 125pips.

    Is there a better alternative ? any futures broker offering this pair at a lower commission ?
     
  10. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Hi, Mandrake,
    No, I do not trade CNY, because the range to USD is highly regulated by the Chinese Gov. That's why the spread is so big. I suppose that you will not find any solid Forex Broker who will give you nice quotes for CNY
     

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