Sive Morten
Special Consultant to the FPA
- Messages
- 18,551
Monthly
Monthly trend holds strongly bearish. After hitting of 0.618 target from huge AB-CD pattern market has shown light but logical retracement. Now price is entering into support area 1.19-1.23 that held EUR twice from collapse – first time in 2008 when sub-prime crisis has started and second – in 2010 at beginning of Greece turmoil.
Although market is now also at 0.88 Fib support from most recent swing, but it has minor importance, since if market almost disrespected 0.5, 0.618 and 0.786 levels it hardly will show solid bounce due 0.88 support. Take a look at down swing – price is really heavy. During whole thrust down there was no even single bounce to major 3/8 resistance, except may be the first retracement. Price shows strong black candles that opens at the High and close and the Low.
But what could pause bears march? One thing that I see here is 1.2140 - 50% support of whole upward swing that has started in 2000. Precisely this level has been tested in 2008 pierced to 1.1875, but held EUR from collapse. Since it has been tested already – it becomes weaker and more obvious and market, as we said, looks heavy. If we even get a bounce from here we should use it to enter short, I suppose, at least if overall picture will not change drastically.
Our minimum target is 1.16-1.17 area, based on analysis of quarterly chart of Dollar Index that we’ve made in Nov 2011. Index has 95% correlation with EUR/USD. Also this is AB=CD target of most recent pattern on current chart. Also take a look – this is significant support of 2005 as well.
From long-term perspective market is entering into very, say, “dangerous” area. If it will break it – this will be the road to 1.07-1.10 area or ultimately even to parity.
However particularly this issue is not very interesting for us currently. In short-term perspective we have to do two things – control remaining of bearish context and, if this will be fulfilled – catch bounces to enter short. Now we have the chance since 50% of 7-year rally should be sensible support, despite that it has been tested already once.
Weekly
Currently weekly time frame is most blur one. Although trend holds bearish, as well as price action, a lot of different supports slightly below market are forced us to be careful. This in turn a bit uncomfortable since currently it is impossible to predict how market will behave there and makes difficult the task of trading plan creation.
Let’s recall our butterfly – I’ve drawn it like, although this is not perfect-looking pattern. Nevertheless, market has shown bounce from its 1.27 level in a way of bear flag and now is approaching to 1.618. This probably could be minor fact but existence of 50% monthly support at 1.2140 gives it a bit another colors. That is also 0.88 support from most recent swing up on monthly and MPS2, although I do not pay much attention to PS2 and PS3. What can we say here – will market show respect of it? Hardly somebody will answer surely.
My thoughts are as follows. Since monthly level was pierced to 1.1875, mostly this low is treated as “low” for any orders placing. So, support around 50% itself should not be significant. Weekly chart is not at oversold, MPS2 is minor level and the fact that price has passed through MPS1 tells about strong bear trend. On previous week market has broken bear flag down and next destination that we have is 1.19-1.20 area – precisely around low of 2008. What else do we have here? Only 1.168 of Butterfly. From that standpoint I can tolerate pullback to 1.2450 area – retesting of flag pattern, but I do not want to see price returning into it.
Daily
Daily trend is bearish, as well as price action, but market is not at oversold. Previous week has relatively narrow trading range, that’s why pivot points for coming week stand very close to each other. Here we already see some kind of respect of support level that we’ve discussed above.
Applying Fib work in combination of pivots gives us 1.2330-1.2367 area. Usually when market retraces in a bear trend – it retraces to WPR1. If it will be in this way – that’s OK, reasonable and logical bounce. But if market will proceed higher this will give us unwelcome thoughts, since price will approach to daily trend breakeven point and moving above WPR1 will tell that this is a bit more than retracement. So, currently let’s focus on 1.2330-1.2367.
4-hour
Couple of thoughts here – first, trend has turned bullish, as well as on hourly chart, and given us bullish stop grabber pattern. Second, market has broken up downward channel or wedge. So, if we will count its width to upside we will get destination point close to our level. So, from 4-hour chart perspectives of reaching 1.2330-1.2366 do not look hopeless.
Conclusion:
In long-term perspective nothing has changed. Nearest destination and crucial level for EUR is 1.18-1.19, while medium term target is 1.16. Breaking through it could lead to 1.10-1.12 level or even to parity in long term perspective.
Currently market stands at monthly support (and some other lower-time frame levels) that held EUR from collapse in 2008. Although it has been pierced previously, still it is valid and price shows some signs of pullback. Personally I like 1.2330-1.2360 level as final point of current pullback, move to 1.2450 will be acceptable, but from bearish standpoint I do not want to see higher move – return back in weekly bearish flag.
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.
Monthly trend holds strongly bearish. After hitting of 0.618 target from huge AB-CD pattern market has shown light but logical retracement. Now price is entering into support area 1.19-1.23 that held EUR twice from collapse – first time in 2008 when sub-prime crisis has started and second – in 2010 at beginning of Greece turmoil.
Although market is now also at 0.88 Fib support from most recent swing, but it has minor importance, since if market almost disrespected 0.5, 0.618 and 0.786 levels it hardly will show solid bounce due 0.88 support. Take a look at down swing – price is really heavy. During whole thrust down there was no even single bounce to major 3/8 resistance, except may be the first retracement. Price shows strong black candles that opens at the High and close and the Low.
But what could pause bears march? One thing that I see here is 1.2140 - 50% support of whole upward swing that has started in 2000. Precisely this level has been tested in 2008 pierced to 1.1875, but held EUR from collapse. Since it has been tested already – it becomes weaker and more obvious and market, as we said, looks heavy. If we even get a bounce from here we should use it to enter short, I suppose, at least if overall picture will not change drastically.
Our minimum target is 1.16-1.17 area, based on analysis of quarterly chart of Dollar Index that we’ve made in Nov 2011. Index has 95% correlation with EUR/USD. Also this is AB=CD target of most recent pattern on current chart. Also take a look – this is significant support of 2005 as well.
From long-term perspective market is entering into very, say, “dangerous” area. If it will break it – this will be the road to 1.07-1.10 area or ultimately even to parity.
However particularly this issue is not very interesting for us currently. In short-term perspective we have to do two things – control remaining of bearish context and, if this will be fulfilled – catch bounces to enter short. Now we have the chance since 50% of 7-year rally should be sensible support, despite that it has been tested already once.
Weekly
Currently weekly time frame is most blur one. Although trend holds bearish, as well as price action, a lot of different supports slightly below market are forced us to be careful. This in turn a bit uncomfortable since currently it is impossible to predict how market will behave there and makes difficult the task of trading plan creation.
Let’s recall our butterfly – I’ve drawn it like, although this is not perfect-looking pattern. Nevertheless, market has shown bounce from its 1.27 level in a way of bear flag and now is approaching to 1.618. This probably could be minor fact but existence of 50% monthly support at 1.2140 gives it a bit another colors. That is also 0.88 support from most recent swing up on monthly and MPS2, although I do not pay much attention to PS2 and PS3. What can we say here – will market show respect of it? Hardly somebody will answer surely.
My thoughts are as follows. Since monthly level was pierced to 1.1875, mostly this low is treated as “low” for any orders placing. So, support around 50% itself should not be significant. Weekly chart is not at oversold, MPS2 is minor level and the fact that price has passed through MPS1 tells about strong bear trend. On previous week market has broken bear flag down and next destination that we have is 1.19-1.20 area – precisely around low of 2008. What else do we have here? Only 1.168 of Butterfly. From that standpoint I can tolerate pullback to 1.2450 area – retesting of flag pattern, but I do not want to see price returning into it.
Daily
Daily trend is bearish, as well as price action, but market is not at oversold. Previous week has relatively narrow trading range, that’s why pivot points for coming week stand very close to each other. Here we already see some kind of respect of support level that we’ve discussed above.
Applying Fib work in combination of pivots gives us 1.2330-1.2367 area. Usually when market retraces in a bear trend – it retraces to WPR1. If it will be in this way – that’s OK, reasonable and logical bounce. But if market will proceed higher this will give us unwelcome thoughts, since price will approach to daily trend breakeven point and moving above WPR1 will tell that this is a bit more than retracement. So, currently let’s focus on 1.2330-1.2367.
4-hour
Couple of thoughts here – first, trend has turned bullish, as well as on hourly chart, and given us bullish stop grabber pattern. Second, market has broken up downward channel or wedge. So, if we will count its width to upside we will get destination point close to our level. So, from 4-hour chart perspectives of reaching 1.2330-1.2366 do not look hopeless.
Conclusion:
In long-term perspective nothing has changed. Nearest destination and crucial level for EUR is 1.18-1.19, while medium term target is 1.16. Breaking through it could lead to 1.10-1.12 level or even to parity in long term perspective.
Currently market stands at monthly support (and some other lower-time frame levels) that held EUR from collapse in 2008. Although it has been pierced previously, still it is valid and price shows some signs of pullback. Personally I like 1.2330-1.2360 level as final point of current pullback, move to 1.2450 will be acceptable, but from bearish standpoint I do not want to see higher move – return back in weekly bearish flag.
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.