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FOREX PRO Weekly January 02-06, 2012

Discussion in 'Sive Morten- Currencies and Gold Video Analysis' started by Sive Morten, Dec 31, 2011.

  1. Sive Morten

    Sive Morten Special Consultant to the FPA

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    EUR/USD Daily Update, Wed 04, January, 2012

    Good morning,
    Today I've tried to take a fresh look at daily picture, and found that I'm not so sure that daily retracement has not started yet.
    The reason for that is some moments:
    1. If you will take as "A" point of initial AB-CD pattern on daily time frame second candle, from which move has really started - you will find that 1.618 extension has bit hit;
    2. Current price action with recent butterfly also could be treated as W&R, especially if we will take into consideration that trend has held bullish during new low appearing.
    These are bullish signs, that very often lead to reversal or at least appear in the beginning of some move to the upside.

    The one thing that still holds me on thought about appearing of new low is weekly AB-CD incompletement. Even If you will take as "a" also another candle - the target will move 20 pips higher, but it still has not been reached.

    Now, we see that market has reached crucial area - 0.618 resistance, pivot resistance 1 and AB=CD target on hourly time frame.
    Still, 1.618 target has not been reached yet.
    Today our major task is to watch for price action - if market will break this area and hold above it, then it will mean that bears have a problem - this is not natural development for bear trend, especially right above significant target.
    If market will form some reversal pattern, say, Butterfly, and hit 1.618 extension on hourly chart, this may be could lead to real reversal.
    Anyway conservative approach is to enter short only when market will move below pivot point. Although you may try to take some reversal pattern around this area - it will not be absolutely safe, but if you will right - your entry point will be much better as risk/reward ratio.
    So, choice is up to you
     

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  2. Triantus Shango

    Triantus Shango Sergeant Major

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    some possible target for longs

    guys, louis, on H4 it looks like we might have an inverse H&S in progress. well, it looks like the head is complete, so IF it turns out to be a H&S, market will retrace down a bit to create the right shoulder. if so, i would say enter long. (not just based on that, but that would seem like a good level to enter.) also, if you look at the daily chart i attached, i marked 3 red lines. they define a 1400 pip range we can work with, from around 4200 down to 2858 or so.

    so, if certain significant levels are taken out on the way up, i think it makes sense to expect a potential max retrace of 700 pips, that is all the way to the mid red line which sits at around 3558. from current levels, that's about 500 pips of potential profit.

    but again, the significant levels sive is marking need to be broken definitely. the current setup seems to lend itself well to a practice run of adding to a winning position.

    i hope am right. :)
     

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  3. Triantus Shango

    Triantus Shango Sergeant Major

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    by the way, jim rogers told reuters the other day that he was long EUR. according to him, too many people are short, and therefore he favors the contrarian trade. coming from a guy who started with USD 600 in his pocket and now is a billionaire, maybe he is on to something. just saying. :p
     
  4. Triantus Shango

    Triantus Shango Sergeant Major

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    sive,

    Boris Schlossberg, Director of Currency Research, at GFT says this:

    '... and the marquee event of the new year – Friday’s nonfarm payroll report (NFP) due at 8:30 a.m.


    Overall, the market is anticipating generally positive U.S. data, especially in light of the fact that the regional indexes have all surprised to the upside, and the weekly jobless claims numbers have been well below the key 400K barrier for quite some time.


    WHAT THE DATA MEANS


    Ironically, if the U.S. data proves positive, it should be supportive for risk appetite and EUR/USD. If equities can stage a sustained rally at the start of this year, the euro could squeeze higher on short covering and relief flows.


    However, technically the pair faces daunting resistance at the 1.3200 level, where it failed badly two weeks ago.


    If the pair is to clear that barrier, credit conditions in the eurozone must improve markedly. Otherwise, it will be just another dead cat bounce on the way to new lows below the 1.2800 figure. '

    Source: http://www.sfomag.com/SFOWeekly/Det...012&STID=ED1E9D38-149A-4637-AC43-5C6BCF275EFB


    what do you think?
     
    #14 Triantus Shango, Jan 4, 2012
    Last edited: Jan 4, 2012
  5. Triantus Shango

    Triantus Shango Sergeant Major

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    right shoulder in progress.... :rolleyes:
     
  6. linxtips

    linxtips Recruit

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    Hi Triantus,

    I really cant see the H&S that you are talking about. Shoudn't the market reach 32 area before completing the head and then go to around 2950 and back through 3200 to complete the right shoulder ant the whole inverted H&S?

    cheers!
     
  7. zakiaziz

    zakiaziz Private

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    hi triantus..
    H&S looks weird.. at first i also think it will be H&S on H4.. but right now right shoulder looks more bearish than left shoulder.. what do u think?
     
  8. RahmanSL

    RahmanSL Major

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    From my observation since the Asian market, eur/usd (and other usd crosses) is stuck to Gold. Gold goes up, and the pair follow suit. Gold goes down and the pair obediently follows.
    I really don't know how any indicators can help in this type of situation!
     
  9. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Hi Triantus,
    if you let me to add just couple of words.
    At MHO it hardly could be treated as H&S due to lack of harmony between shoulders. Besides, such strong plunge from let's say "expected" area shift odds to new lows probably. Also my experience tells that H&S at 4-hour and hourly time frame usually fail precisely by such action as you can see now - acceleration of right shoulder.

    Hi buddy,
    I suppose that it is mostly due the fact that Gold trades for USD, and relation between EUR/USD and Gold(/USD) is due USD but not EUR and Gold. It's better to check this assumption with Dollar Index action, to be absolutely sure.
    Well known relation with gold AUD has.
     
  10. RahmanSL

    RahmanSL Major

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    Hi Sieve,

    I am aware of the Gold to USD relationship.
    But today I have been trading both Gold and the EUR/USD exclusively and begin to notice the peculiar behavior of EUR/USD.

    I placed the EUR/USD market window next to the Gold M1 chart and that's when I noticed that as soon as Gold makes a move, the EUR/USD does the exact same movements, though with a little time lag.
    So I did the obvious and started placing EUR/USD trade positions when Gold moves either upwards or to the down side, and it has been 100% correct right up to now.
     
    #20 RahmanSL, Jan 4, 2012
    Last edited: Jan 4, 2012

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