Sive Morten
Special Consultant to the FPA
- Messages
- 18,571
Monthly
December month gradually comes to an end, and currently we see solid bearish price action by this month. Monthly trend holds bearish, market is not at oversold. So, long-term bearish bias still holds intact. Meantime, the most important information for us on monthly time frame is Agreement support level of 1.2905-1.3040. Since market has reached it – this is not the time currently think about increasing short position on lower time frames. Although we all know that anything could happen, market could just absolutely disrespect this level by some emergency event from EU, but we have to act according to current situation. Now, what we do see is that market at monthly Agreement. Probability suggests that commonly it leads to some retracement – either deep or small.
Another important moment is that weekly/daily AB=CD target that we are trading currently stands slightly lower that Agreement level. It could happen so, that retracement will start when market will pierce a bit monthly Agreement just to reach weekly AB=CD, because 100 pips move on monthly is a very small difference – it could be even seen on the chart.
Weekly
On the weekly time frame we see downward breakout of pennant that we’ve talked about previously. Trend holds bearish, level of oversold for coming week is 1.2576, so there are no barriers from here. This time frame does not carry any additional information – you can just better see AB=CD pattern and its target. By the way, take a note that target stands slightly lower than previous significant low, so market could proceed slightly lower, fueled by stop triggering. In this case it can trigger 1.618 extension of different AB-CD at 1.2750 as well.
Here again I have to warn you that market in nearest days will have to struggle against monthly support. It might look as deeper retracements, pullbacks more choppiness on intraday charts and so on. So, if you’re long-term trader and want to increase position – it’s better to wait when this pullback will start or when there will be some clear signs that it will not happen at all. Otherwise, you may get to very desirable entry and even less desirable pullback after that. But still - the decision is yours.
Daily
Here we see some retracement that we’ve discussed through the week due 1.618 Butterfly pattern. Overall picture looks solid bearish, market is not at oversold. Recent price action could help us to find crucial points – they will let to estimate will retracement be deeper or not, does market reestablish move to 1.2830 level or not yet and so on. Pivot points will become our major helpers here.
First of all, take a look that CD leg of our large AB=CD pattern develops in some kind of parallel channel. Lower border for coming week coincides with target of AB=CD and pivot support 1 1.2855 (lime dash line), while upper border stands between pivot and nearest Fib resistance 1.3146 and daily K-resistance 1.3264-1.3269. Pay attention that nearest Fib resistance stands at the same level as previous lows – 1.3142. Since pivot points traded by market in 70% of cases – it is very probable that market can touch pivot and reverse to the downside. This will be perfect for the bears. Still, crucial level for short-term is 1.3264-1.3269, because you can see that MACD trend will hold bearish only till that area. Also this is upper border of parallel channel and pivot resistance 1. And as we’ve said million of times – when market stands in bear trend and turns to retracement – it should retrace not higher than pivot resistance 1. So, if market will break this level – it will mean that deeper retracement is possible.
Also it could lead to failure breakout of the channel, since daily K-area and pivot resistance stand just above it. Overall probability still stands on the side of downward continuation, because market stands very close to AB=CD target and in most cases it reaches it.
That’s being said, there are two levels that we should carefully monitor on coming week. First one is 1.3142 – if there will be sell signals, probably market will touch pivot and continue move down. Second one is K-resistance 1.3264-1.3269 + pivot resistance 1.3296. This could be also a failure breakout of channel.
Nearest target is 1.2830-1.2855 AB=CD + pivot support 1, or even 1.2750 if stop orders will add sufficient fuel for downward acceleration.
4-hour&hourly
I do not post 4-hour chart, since there is nothing new to comment. Most important is that trend is bullish. On hourly chart below it is difficult to mark anything clear – very choppy price action inside some channel. Probably you can find a lot different butterflies and AB-CD’s inside it, but since we do not have any clear patterns – they will not help us much. Still, one interesting thing is that most peaks are stopped near hourly overbought, while market does not touch oversold at all. May be this is the sign that upward pressure is a bit greater than downward and market still will creep a bit higher. Second, in such choppy and sloppy environment very often becomes useful an applying of harmonic swings. Take a look – upward move repeats at 100 pips. Hence, next possible reversal target is 1.3106 approximately. While downswings (have not marked) also very harmonic are around 80 pips. If this consequence will be broken – this will be an early warning of possible thrusting move.
But again – just look at the chart and try to offer something really clear – this is a real task.
Conclusion:
Long-term bias holds bearish. It makes sense to hold long-term bearish positions. Still do not be to hurry to add more. Probability suggests that some retracement could happen. Probably it will be better to add more when it will happen.
In the beginning of the week, we have to keep en eye on two levels, since they could become ones from which downward move could reestablish – 1.3142 and 1.3260-1.3290. Potential targets are 1.2830 or even 1.2750. After that retracement for long-term players could start.
Intraday chart is very difficult to analyze so applying of harmonic swings looks reasonable. Once this consequence will be broken – this could become an early sign of thrusting move and end point of current retracement.
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.
December month gradually comes to an end, and currently we see solid bearish price action by this month. Monthly trend holds bearish, market is not at oversold. So, long-term bearish bias still holds intact. Meantime, the most important information for us on monthly time frame is Agreement support level of 1.2905-1.3040. Since market has reached it – this is not the time currently think about increasing short position on lower time frames. Although we all know that anything could happen, market could just absolutely disrespect this level by some emergency event from EU, but we have to act according to current situation. Now, what we do see is that market at monthly Agreement. Probability suggests that commonly it leads to some retracement – either deep or small.
Another important moment is that weekly/daily AB=CD target that we are trading currently stands slightly lower that Agreement level. It could happen so, that retracement will start when market will pierce a bit monthly Agreement just to reach weekly AB=CD, because 100 pips move on monthly is a very small difference – it could be even seen on the chart.
Weekly
On the weekly time frame we see downward breakout of pennant that we’ve talked about previously. Trend holds bearish, level of oversold for coming week is 1.2576, so there are no barriers from here. This time frame does not carry any additional information – you can just better see AB=CD pattern and its target. By the way, take a note that target stands slightly lower than previous significant low, so market could proceed slightly lower, fueled by stop triggering. In this case it can trigger 1.618 extension of different AB-CD at 1.2750 as well.
Here again I have to warn you that market in nearest days will have to struggle against monthly support. It might look as deeper retracements, pullbacks more choppiness on intraday charts and so on. So, if you’re long-term trader and want to increase position – it’s better to wait when this pullback will start or when there will be some clear signs that it will not happen at all. Otherwise, you may get to very desirable entry and even less desirable pullback after that. But still - the decision is yours.
Daily
Here we see some retracement that we’ve discussed through the week due 1.618 Butterfly pattern. Overall picture looks solid bearish, market is not at oversold. Recent price action could help us to find crucial points – they will let to estimate will retracement be deeper or not, does market reestablish move to 1.2830 level or not yet and so on. Pivot points will become our major helpers here.
First of all, take a look that CD leg of our large AB=CD pattern develops in some kind of parallel channel. Lower border for coming week coincides with target of AB=CD and pivot support 1 1.2855 (lime dash line), while upper border stands between pivot and nearest Fib resistance 1.3146 and daily K-resistance 1.3264-1.3269. Pay attention that nearest Fib resistance stands at the same level as previous lows – 1.3142. Since pivot points traded by market in 70% of cases – it is very probable that market can touch pivot and reverse to the downside. This will be perfect for the bears. Still, crucial level for short-term is 1.3264-1.3269, because you can see that MACD trend will hold bearish only till that area. Also this is upper border of parallel channel and pivot resistance 1. And as we’ve said million of times – when market stands in bear trend and turns to retracement – it should retrace not higher than pivot resistance 1. So, if market will break this level – it will mean that deeper retracement is possible.
Also it could lead to failure breakout of the channel, since daily K-area and pivot resistance stand just above it. Overall probability still stands on the side of downward continuation, because market stands very close to AB=CD target and in most cases it reaches it.
That’s being said, there are two levels that we should carefully monitor on coming week. First one is 1.3142 – if there will be sell signals, probably market will touch pivot and continue move down. Second one is K-resistance 1.3264-1.3269 + pivot resistance 1.3296. This could be also a failure breakout of channel.
Nearest target is 1.2830-1.2855 AB=CD + pivot support 1, or even 1.2750 if stop orders will add sufficient fuel for downward acceleration.
4-hour&hourly
I do not post 4-hour chart, since there is nothing new to comment. Most important is that trend is bullish. On hourly chart below it is difficult to mark anything clear – very choppy price action inside some channel. Probably you can find a lot different butterflies and AB-CD’s inside it, but since we do not have any clear patterns – they will not help us much. Still, one interesting thing is that most peaks are stopped near hourly overbought, while market does not touch oversold at all. May be this is the sign that upward pressure is a bit greater than downward and market still will creep a bit higher. Second, in such choppy and sloppy environment very often becomes useful an applying of harmonic swings. Take a look – upward move repeats at 100 pips. Hence, next possible reversal target is 1.3106 approximately. While downswings (have not marked) also very harmonic are around 80 pips. If this consequence will be broken – this will be an early warning of possible thrusting move.
But again – just look at the chart and try to offer something really clear – this is a real task.
Conclusion:
Long-term bias holds bearish. It makes sense to hold long-term bearish positions. Still do not be to hurry to add more. Probability suggests that some retracement could happen. Probably it will be better to add more when it will happen.
In the beginning of the week, we have to keep en eye on two levels, since they could become ones from which downward move could reestablish – 1.3142 and 1.3260-1.3290. Potential targets are 1.2830 or even 1.2750. After that retracement for long-term players could start.
Intraday chart is very difficult to analyze so applying of harmonic swings looks reasonable. Once this consequence will be broken – this could become an early sign of thrusting move and end point of current retracement.
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.