FOREX PRO Weekly August 20-25, 2012

[Triantus Shango]

maybe on H1. on M30, i don't like the look of it. but that's just me. what the hell do i know?

ok what about this one?View attachment 6414

 

[BeeKay8]

Hey all,

I don't know about your guy's trade last night but my short @ 1.2560 has been stopped out at BE after reaching as low as 1.2479. I moved my SL to BE when market got into 1.24 area. My TP was not even at 3/8 retracement of butterfly but hourly k-support at 1.2570.

Price will probably continue down next week to at least 3/8 retracement but right now at this price (1.2517) I cannot possibly enter short and feel safe with my wide SL.

Nevertheless, thanks again for your weekly analysis, Sive. I really do appreciate and am learning so much from you.

 

[MidnightRun]

test test test

 

[WaveRider]

can you help?

Sive,
On Friday, evidence of downward intention was all over the charts. Here is a screen shot of some of the odd choppy action you don't typically see. The first box is next to a 1 minute candle with about 25 pip thrust down and the second box is by a 35 pip one minute candle. I understand why a long bar is formed. Typically on this pair, most price movement is very quick all done in about four 10 minute candles with a lot of choppy waters in between them. Usually, the long 1 and 5 min candles go the same direction indicating most of the money movers are going the same direction, and the choppy retracement is a lot of smaller shorter candles.
.
What are the market mechanics behind this down thrusting candle (which is expected at a major Resistance) and then this "irrational" up thrusting candle?
1. Is this a wash and rinse just to knock out little guys who are getting short? (malicious and intentional)
2. Big market players not being of the same opinion as to where to take the market? (unintentional)
3. Some central bank getting in for its own reasons that may or may not be immediate profits?
4. Some other reason I can't think of?
.
The other question on everyone's mind is: how much money does it take to move the EUR/USD a pip or in this case 35 pips in a minute? One pro trader said in another forum "An order of less than 1000 lots could not move the market one pip". What say you?

 

[Sive Morten]

Sive,
On Friday, evidence of downward intention was all over the charts. Here is a screen shot of some of the odd choppy action you don't typically see. The first box is next to a 1 minute candle with about 25 pip thrust down and the second box is by a 35 pip one minute candle. I understand why a long bar is formed. Typically on this pair, most price movement is very quick all done in about four 10 minute candles with a lot of choppy waters in between them. Usually, the long 1 and 5 min candles go the same direction indicating most of the money movers are going the same direction, and the choppy retracement is a lot of smaller shorter candles.
.
What are the market mechanics behind this down thrusting candle (which is expected at a major Resistance) and then this "irrational" up thrusting candle?
1. Is this a wash and rinse just to knock out little guys who are getting short? (malicious and intentional)
2. Big market players not being of the same opinion as to where to take the market? (unintentional)
3. Some central bank getting in for its own reasons that may or may not be immediate profits?
4. Some other reason I can't think of?
.
The other question on everyone's mind is: how much money does it take to move the EUR/USD a pip or in this case 35 pips in a minute? One pro trader said in another forum "An order of less than 1000 lots could not move the market one pip". What say you?

Hm WaveRider
what a riddle you have given to me...
1.First, when you trade at 1m chart - you hit by elbows with market-makers and dealers. You have to be very professional and your knowledge of market mechanics should be oversome. (I do not trade on 1 m, and even on 5 m).
2. I can't answer on your question on impulse. First, you need to find was there any new announcement or something during this periods. May be some rumors have appeared or so on...
3. I can comment just technical picture. First bar is definitely not W&R, since there is no object to wash out there. But second large bar up seems logical, because it was the break of resistance on 1m chart. Second, since previous move down was the first of such kind after solid move up. Usually retracements up is deep after that. That is what we see.

Speaking about value/pip ratio. This task could be solved by simple calculation, I suppose. Daily turnover of spot forex is 1.5 Bln. I do not remember exactly how much on EUR/USD Pair, correct me if I'm wrong, but probably around 40%. Hence, this is approx. 600 Bln. Calculate daily average range, you can make it by historical volatility and you will get how much it is needed to push market. Off cause it will be rather approximal value, since turnover spreads also on move inside the range. But you, probably can use also open interest for EUR/USD futures, calculate their volume and by Futures/Spot ratio recalculate it for Spot Forex.

 

[dave edwards]

Hi Sive,
Many thanks for your insight. I think also it is a geat time to buy GOLD. I am expecting gold to pull back to 1625 level in the near future
after this weeks rally and then I believe it can run from there to new highs. I am expecting gold to be 2500 level June2013.
Once again thanks for all your personal insight into the euro market.
Dave
cape town