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FOREX PRO Weekly, January 10-14, 2011

Discussion in 'Sive Morten- Currencies and Gold Video Analysis' started by Sive Morten, Jan 9, 2011.

  1. Sive Morten

    Sive Morten Special Consultant to the FPA

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    We’ve talked about NZD a long time ago, so, I’ve decided to refresh this view. As usual, I use futures instead of spot, so the difference is about 30+ pips. (Spot closed at 0.7593, futures at 0.7565). So, let’s start with it…

    Annual
    As with EUR/USD, we do not trade annual chart, but it’s useful to take a look at it in the beginning of the year at least with single purpose – calculate annual pivot point. Here we can see that 0.7419 is an annual pivot point for NZD/USD pair. Guys, here is a very simple way to calculate pivot point for any time frame. Do you see this green line? This is simple MA that is based on (High+ Low + Close)/3 shifted forward for 1 period. This is nothing else than a pivot point calculation. MT4, buy the way, allows to draw such MA, so you can use it, if you do not have a pivot indicator or too lazy to calculate it manually.
    [​IMG]

    Monthly
    Monthly trend is bullish. We can see couple of Fib targets. First, market has reached 0.618 target at 0.7514 from huge ABC swing, shown some retracement and continues move up. 0.618 Fib target at 0.8229 is just above the market and this level coincides with monthly overbought at 0.8219. This is next target to the upside. Far above the market are 100% Fib targets from both of these swings – 0.9136 and 0.9266, but they are not quite actual currently, because they are too far still.
    Another important moment is that market didn’t bounce from daily overbought area – it just stands in the range and holds above the previous highs, that I’ve marked with circles. I think that this is a bullish sign, because if move above the previous highs was just wash & rinse, then market should show deeper return to the downside. The fact that market stands and holds makes me think, that possibly there is still some strength in it.
    [​IMG]

    Weekly
    Weekly trend is bearish. But previous price action shows real strength. Look, market has accelerated directly to 1.27 expansion target and after that shows just 0.382 retracement. The next upside target is 1.618 Fib expansion at 0.8230 that is coincides with monthly 0.618 target and overbought. Usually, when market shows such strong acceleration it reaches 1.618 target after some retracement down. Currently we see that this retracement is underway. However the question is still stands – will it be AB retracement or AB-CD. At the same time both of these scenarios will not cancel the possibility of further move up. The target of this retracement makes an Agreement with 5/8 Fib support at 0.7111. If market will reach only 0.7364 – 0.618 Fib target then this could turn to butterfly pattern – look at #2 chart…
    #1
    [​IMG]

    In this case, the nearest target is 1.27 Butterfly expansion at 0.8134, but more probable that market will still reach 0.8230.
    #2
    [​IMG]

    Daily
    Daily trend is bullish. This time frame tells, that move up is more probable, at least currently – market shows MACD Predictor failure pattern. Look at red line – this is MACD Predictor. On Thursday market has reached 0.618 Fib support (this is also was a pivot support1). Early on Friday trend has shifted to bearish (price has moved below the red line) – it means that some people opened shorts due to this unconfirmed signal. But at the end of the day, due to NFP release market didn’t confirm this trend shifting and close above the red line. So, these people, has appeared to be trapped in wrong short position. Their stops are somewhere above the market and possibly above the previous highs – so, this is the target of this pattern. Also, you can see that nearest upside target is 0.618 Fib expansion from recent swing at 0.7806 area. And this target is just above the highs…
    Second moment – colored dash lines, as usual, are weekly pivots. Blue line stands for point itself at 0.7606, lime one is for pivot support 1 at 0.7468 and it’s coincide with 5/8 Fib support, and the red line is pivot resistance 1 at 0.7703.
    #1
    [​IMG]

    Now let’s take a look at resistances – the first 3/8 one stands at 0.7610 and coincides with pivot point, 5/8 resistance is at 0.7672
    #2
    [​IMG]

    Intraday
    Trend is bullish, but price action is sloppy a bit. On the top, you can see excellent example of DRPO “Sell”. This is just a rearview mirror. Currently, we have perfect thrust down, but then market has consolidated too long, to call this DRPO “Buy”. It has shown many penetrations of green line – that is 3x3 SMA. So, possibly we can call it as DRPO LAL (Look-alike), but will it work or no, who knows… Other words, I can’t call it as a nice Buy signal. At the same time this is not time for selling, because of MACDP failure pattern on daily time frame.
    #1
    [​IMG]

    Here is hourly chart – don’t break your eyes… First, market has accomplished Butterfly Sell at point “B”. Now we can see that Butterfly “Buy” pattern is possible, if BC-swing will hold followed price action.
    From the other side – we have hourly MACDP failure, that suggests that point B could be taken out, market could reach 100% target around 0.7611 – hourly Confluence resistance and weekly pivot point. In this case the latter Butterfly will be canceled. What we should to do then?
    Well, I think that market should reach 0.7610 area. Then, personally, I’ll be watching for market behavior in this area. If market will continue move higher, then, possibly daily Bullish pattern starts to work and market could reach 0.7810 area. If market will fail around 0.7610 area it will mean that this is not the time for any bullish position. In this case market could reach 0.7468 first, and make AB-CD weekly retracement in perspective.
    #2
    [​IMG]

    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. Baletnik

    Baletnik Recruit

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    Hello,

    I have a question about AUDUSD from previous week for all who own DiNapoli book and have read about DRPO.

    On attached chart it seems like DRPO Buy forming on 4-h chart. We have a "close above" 3x3 and then "close below". But that close was made with rising (green) candle under the 3x3 peak (in red oval). Is that valid for closing below 3x3 or should it penetrate further down with falling (red) candle?

    Also, now we could see a "close above" 3x3 (in a valley inside the red square) that could be lower that "close below". It is kind of strange situation and I'm not sure if it's valid or not.

    Regards
     

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  3. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Yes, it will be valid, because there is only one condition - tops or bottoms should be relatively close to each other. The fact that second close will be lower than previous one does not cancel the DRPO pattern.
     
  4. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Aussie DRPO Buy

    Hi, Guys
    Here is nice DRPO Buy on 4-hour aussie chart. May be it will turn to DRPO Failure, who knows... But currently it looks good, besides, the second low is lower than the first low, you know that I like it.
     

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  5. pckeys

    pckeys Private

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    Looking similar daily/weekly action on AUDCAD. Price looks cleaner.

    Would love your comments on the DPRPO on weekly and butterfly on daily .. although the thrust prior to "X" on butterfly is not great.
     

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  6. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Thrust on second chart is Ok, but I think that this is DRPO LAL, because too much consolidation between the penetrations of 3x3.
    On the first chart I do not see any butterfly.
     
  7. Sive Morten

    Sive Morten Special Consultant to the FPA

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    EUR/USD Daily Update, Tue 11, January 2011

    Good morning,
    let's shift back to EUR discussion. It has reached 1.27 Fib expansion target at daily time frame, daily oversold, and weekly Fib support at 1.2980 area. Although I expect that downmove should continue to 1.618 Expansion, currently is not the time to establish short positions - we need some bounce.

    On 4 hour chart we can see, that weekly pivot has not been traded by the market yet, also it coincides with Fib resistance 1.3084. So, this is the first area that should be looked for some signs of weakness.
    Just above the market also is a strong area of resistance 1.3213-1.3217 - daily Confluence resistance (although I show you just 0.618 Fib resistance level).
    Now market is showing nice context for possible DRPO Buy pattern. If market will show close below 3x3, then above again - we will get a confirmation of this pattern. That is what I personally will track for on EUR in coming days.
     

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  8. Ahmed El-Shazly

    Ahmed El-Shazly Private, 1st Class

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    Sive-
    Dont you see a possible butterfly buy pattern in EUR/USD with a minimum target of 1.3500?
     

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  9. Francois

    Francois Recruit

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    Hi Sive

    On aud/usd weekly chart , looks like DRPo formed. Would you consider it valid
    and should one wait for current week to close before it is confirmed.
    Thanks for great weekly analysis.
     
  10. ochills

    ochills Master Sergeant

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    Good work Sive as usual.

    Thanks for deviating to EUR/USD.
    thanks You just confirm my analysis.
    pls what do u think about AUD/CAD presently experiencing a free fall.
    thanks
     

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