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FOREX PRO Weekly April 16-20, 2012

Discussion in 'Sive Morten- Currencies and Gold Video Analysis' started by Sive Morten, Apr 14, 2012.

  1. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Monthly
    On monthly chart we see almost the same picture as on previous week – just 10 pips difference. So, we have nothing to add here.
    April price action shows downward move. Still, for monthly time frame this is not significant move and, as we’ve said previously it is still possible for price to reach 1.35-1.37 K-resistance area.
    The rest of analysis is the same – our focus is K-level as holding barrier. We can accept reaching of 1.37 from long-term bearish view (1.16), but we anyhow can’t justify move through it.
    The major interest here, as previously, stands with price behavior around Agreement support from one side and K-resistance area from the other. After hitting of 0.618 Fib extension target and Agreement market has shown retracement to 1.3509-1.3709 that is solid K-resistance at monthly chart and typically, price should not break it after just hitting of 0.618 target. Otherwise, it will be a strong sign that market sentiment has changed and bears’ power falls under question
    Still, as we’ve mentioned previously there is a possibility of AB=CD retracement on lower time frames. In this case market could show a bit deeper move inside of K-resistance. Although this is not significant for monthly time frame, it could become very important for us, since we mostly trade at daily charts.


    [​IMG]

    Weekly
    Market is continuing with downward smaller ab=cd pattern. Price has closed below monthly pivot support 1. Trend still holds bullish and will remain bullish, even if market will reach predefined this ab=cd pattern at 1.29-1.2950 area. That’s why we do not deny possibility of greater upward AB=CD to 1.37-1.38 area yet.
    According to current picture we probably should be focused on downward continuation on coming week - continuation to 1.29-1.2950 area makes sense and seems logical in current environment.
    [​IMG]


    Daily
    Although on Friday morning market has moved above pivot point and hourly K-resistance we have said that failure breakout is possible. To be honest I was surprised a bit by such price action. Although we have theoretical context for butterfly, my mind can’t agree with the possibility of upward move right till the last moment, when even breakout has happened. Mostly because current swing down has fundamental foundation – US economy looks more preferable than EU and after comments of denying third stage of QE gives market more confidence in dollar strength. That’s why butterfly possibility looks as phantom (menace for bears). Today we see that probably this is true.
    Recall that our primary condition was move below 1.3150 level – inside of bearish flag and shifting intraday trends to bearish. That has happened. Although market has not broken through 1.30 butterfly’s low and has not erased it but probability of this evermore significant. Also we have to be prepared to possible downward continuation through 1.29 level, because classical way of target estimation based on flag’s mast and it stands around 1.27. All right, anyway on coming week we should be focused on downward move and search possibility to enter short.
    [​IMG]

    4-hour
    Sorry for a bit heavy chart and overload with trend lines. Most important thing here is the trend – it has turned bearish. That is what we’ve wanted to see. Also we see failure breakout flag and true downward breakout. Jack Schwager calls it as “Bullish trap”. Also we have here downward AB=CD pattern with the same target at 1.29. Pay attention that 1.3025 0.618 target stands below previous lows, so they will hardly hold and some acceleration after breakout is possible. Probably we can use this recent swing down to search level where to enter short.
    [​IMG]

    30-min
    Today we will take look at 30-min chart instead of hourly. By the way on hourly time frame trend holds bearish. Here we see two levels to watch for – first one is 1.31 – nearest 3/8 resistance and WPP, second is 1.3124-1.3134 K-resistance and lower border of broken flag. Retracement really could happen on Monday by confirmed DRPO “Buy” pattern.
    Since all trends hold bearish, market is not at support and overbought, probably will be better to apply gradual enter. For example - 1/3 at 1.31 and 2/3 at K-area. Stop could be placed, probably, above WPR1 at 1.3108.
    [​IMG]



    Conclusion:
    Long-term traders should sit on hands and wait when weekly AB=CD retracement will be over to enter short, or at least market will shift trend to bearish on weekly.
    While weekly context is bullish, market has turned to compounding AB=CD patterns, that has led to bearish bias on daily time frame.
    Finally on daily time frame more or less clarification has come. At least now we should focus on downward continuation that probably will start either from 1.31 or 1.3124-1.3134 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. Sive Morten

    Sive Morten Special Consultant to the FPA

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    EUR/USD Daily Update, Tue 17, April 2012

    Good morning,
    I suspect that today will be a day of expectation. The reason for that is a combination of contradictive patterns on daily time frame. Take a look - market has erased a possiblity of butterfly by creating a new low. Also it could be treated as W&R of previous lows - and that is a bullish pattern.
    One of our forumers has said that market stands in triangle consolidation and he does not expect downward move - may be he is right, since market has returned right above the lower border of triangle.

    From another view we still have bearish trend. By yesterdays low market has hit just 0.618 target of most recent AB=CD pattern and now has reached just 0.382 resistance of recent swing down - quite logical price action, right? (BTW this is also a WPS1...)

    On 4 hour chart we see bullish trend, and moment as market has retested lower line of broken flag. Although we've talked about it in weekly research, but expected that this will happen a bit earlier.

    On hourly chart we also see that 1.30 was a target of hourly Butterfly "Sell" pattern...
    Here was perfect DRPO "Buy" right at bottom. I've traded it yesterday, but exited early since didn't expect solid move up.

    Other words, the fact of this fast return is too early to treat as reversal to upside. But this is my humble opinion. I prefer to wait for some more evidence.
    eur_1h_17_04_12. eur_4h_17_04_12. eur_d_17_04_12.
     
    #2 Sive Morten, Apr 14, 2012
    Last edited: Apr 17, 2012
  3. Sive Morten

    Sive Morten Special Consultant to the FPA

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    EUR/USD Daily Update, Wed 18, April 2012

    Today comment will be short.

    There is a Stop Grabber at daily Time frame and hourly trend has turned bearish. Will it work or not - we'll see, but definitely this is not the time to enter long, since risk is solid.

    You may try to short this market by this pattern. Stop should be placed above yesterday's high (SG high), but probably is better to place it above WPR1, somewhere around 1.3185
    Minimum target is swing low at 1.2990 area, but this target does not contradict with possible downward continuation to 1.29 level.

    To trade it or not - this choice is up to you. I just want to share with pattern that exists on daily TF.
     

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    #3 Sive Morten, Apr 14, 2012
    Last edited: Apr 18, 2012
  4. Sive Morten

    Sive Morten Special Consultant to the FPA

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    EUR/USD Daily Update, Thu 19, April 2012

    Good morning,
    market continues to flirt with pivot point. At the same time we have two side by side stop grabbers on daily time frame. Trend holds bearish.

    Still there is a potential context to watch for during today-tomorrow trading session. This is possible butterfly "Buy" on 4 hour chart. Why is it significant?

    First is because it has the same failure point as stop grabbers - moving above WPR1 1.3182 will cancel as butterfly as stop grabber and shift daily trend to bullish.

    Second is, target of this pattern agrees with target of daily as greater AB=CD as more recent smaller AB=CD.

    Third is, appearing of butterfly right at level of completement of AB-CD stands in a row with weekly upward trend and possible upward reversal. Recall that this AB=CD we treat as retracement inside of bullish AB=CD on weekly chart.

    So, that is the task - two moments to watch for. 1.3182 as failure point and butterfly
     

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    #4 Sive Morten, Apr 14, 2012
    Last edited: Apr 19, 2012
  5. Sive Morten

    Sive Morten Special Consultant to the FPA

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    EUR/USD Daily Update, Fri 20, April 2012

    Good moring,
    Market has not added much clarification. Although it has seemed that some move down has started it was totally erased yesterday.
    Daily trend has turned to bullish side, but price action stands tight, sloppy and choppy, without any sign of thrust, so that fact does add enthusiasm about trend shifting.

    Also, as butterfly on 4-hour chart as stop grabber have not failed yet, and both of them have chances to work.

    On houlry chart I found Butterfly "Sell" pattern. But price action looks anemic.

    As a conclusion, I might say that if you have no position - better to wait till next week. If you have short position - hold it, since chances to move down are still exist.

    I see a bit strange price action on daily chart with bearish bias. Look, market stands at lower border of triangle pattern. Previously, when market has touched the line it has jumped out fast and strong. Now it flirts right at lower border. This is not sign of strength and bullish power. I suspect that we will see downward move still...
     

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    #5 Sive Morten, Apr 14, 2012
    Last edited: Apr 20, 2012
  6. wilsiano

    wilsiano Recruit

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    Thank you Sir for your awesome analysis. You've got a large heart. God bless and take you to the next level of your trading experience. Many thanks!!!
     
  7. fan

    fan Private

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    Dear Sive,

    I think EU will not break 1.30 in coming week and will going upward to 1.32, because I see a triangle action on 1h chart
    727392824bd9acf2e124a&690.
     
  8. squidge42

    squidge42 Corporal

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    #8 squidge42, Apr 15, 2012
    Last edited: Apr 15, 2012
  9. sardinian

    sardinian Private, 1st Class

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    Interesting pattern...
     
  10. cheater

    cheater Private, 1st Class

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    Seems possible and i'm also pretty bias on this upmove. Previous retracement from 1.30-1.33 has also shown the support in place of this trend line. In fact i have entered a small LONG position at 1.30 to trace this upmove :D
     

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