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FOREX PRO WEEKLY, March 05-09, 2018

Discussion in 'Sive Morten- Currencies and Gold Video Analysis' started by Sive Morten, Mar 3, 2018.

  1. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Fundamentals

    This week, guys there are more technical issues that could be interesting for discussion rather than fundamental ones. There are just two events that stand in focus. Tomorrow's Italy elections and recent Trump legal act of tariffs on Steel and Aluminium export. It is interesting historical moment, especially on example of 1930's Import tariffs of Smoot–Hawley that as a rule protectionism in economy leads to strength of nationalism. For example, one of the economic reasons of WWI was attempts of France and GB to hold fast industrial development of Germany. Currently, with strong mutual involving of national economies to each other, especially large ones, such as US, EU, China - starting of import tariffs could lead to chain reaction with hardly forecasting final. And, as history shows, it ultimate cases it could lead to war of different scale.
    Another interesting observations on trade wars is “Historically, the dollar loses from trade wars, which underscores our structural bearish views, especially as the ramping up of twin deficits will require international funding over the next few years,” said Mark McCormick, head of North American FX strategy at TD Securities in Toronto.
    I suspect that this tariffs is a part of big economical game of D. Trump. Major direction of this game is destroy former Neocon democrats ambitions of global domination, significantly reduce spending, safe budget money and re-direct them on US domestic economy needs. Trump wants to make US works for their people but not for small group of crazy World's rulers. As a result, US will restore health of its national economy, but will loose role of World hegemon, or better to say - will refuse it intently. US will be a kind of Canada or Australia with healthy economy, happy people but at the same time will keep solid role in global politics. Now he needs to break old relationships that new US doesn't need any more. To do this, he needs from time to time announce unpopular measures that will accelerate this process. As a result, I think, 3-5 years may be I see NATO disintegration (although it will exist legally for some time more), evacuation of US military forces out from EU and EU integration into Euro-Asia trade space. Also it is unclear what will happen with US limitrophes in EU - Poland, Baltic states and some other "new members" of EU in Eastern Europe. They could be abandoned by everybody... There is already some tensions between Poland and Brussels. Poland actively obstructs building of North Stream 2 and other projects that core EU needs. So, Germany and Co hardly will tolerate this in his homestead.

    Speaking on second topic - Italian elections, here is just one question exists. Whether S. Berlusconi coalition will win or not. If they will - they will create majority in parlament. Although Berlusconi personally can't take any official posts due scandal 5 years ago, but his party is a step forward to new political and economical order in Italy and in direction of EU-Asia (through Russia) united economical space. In this case EU will show gap up on Monday open.

    If Berlusconi’s coalition can not get a majority, Italy will be left with a hung parliament and political deadlock.This is not something new. Actually in Italy this happens more often than in any other country in EU. Besides, in Germany there was the same problem and it still stands on the table, but no significant negative impact on EUR has followed.
    Here is the article on coming elections, where situation is described with more details.

    COT Report
    Recent CFTC data shows that recent downside retracement on EUR has small impact on speculative positions. Take a look at changing of open interest and net long position in last 4 week. While open interest stands flat - speculative position fluctuates. It seems that it reflects action of short-term traders. Before retracement longs were turned to shorts. Last week, when retracement mostly was over - take a look, position has increased again with the same open interest. It means that shorts were turned back to longs again. Still upside potential is still limited as total position stands near highs, although it has some room to grow a bit.

    Source: Oanda.com
    upload_2018-3-3_12-13-58.
    Techincal
    Right now, guys, there are a lot of valuable setups on different currencies, EUR(DXY), GBP, Gold. Also I see really cool setup on CAD and strongly recommend you to re-read post of ButcherFX on AUD and compare to what really has happened on the market. Roger placed view of Pieter van Wyk, official DiNapoli expert. And it seems that scenario with W&R now stands under way...
    Also I do not know what to do tomorrow - either to show you CAD setup, or, as usual, take a look at Gold market...

    Monthly


    No big changes on monthly chart has happened. It stands in "Buy" mode, price is pulling back out from strong resistance of K-resistance 1.2516-1.26, accompanied by YPR1 @ 1.2617 area. There is not overbought on monthly chart.

    Resistance area is rather strong and current retracement still looks too small to be treated as proportional respect to it. At the same time, market also could easily fluctuate inside the range till the previous top of ~1.26 and challenge them. So, monthly picture doesn't provide us something new.
    eur_m_05_03_18.

    Weekly

    Weekly chart brings very important issue. Retracement down was due monthly K-resistance and, here on weekly - major COP target and butterfly "Sell". Butterfly has reached minimum respect target - 3/8 support. Now weekly chart has turned to "buy" mode as well and formed bullish grabber. It means that we could buy on retracement against current lows of 1.2154.

    Recall that last week we had "Oops!" bullish setup on daily and it has started well.

    Speaking on upside target - market should take out previous tops of 1.2555. As Yearly pivot stands around 1.2616, it very probable that it could be reached...
    eur_w_05_03_18.

    Daily

    Daily time frame in "Sell" mode, but here we have "Ooops!" bullish directional pattern, and, according to DiNapoli "Direction" overrules "trend". That's why "Direction" here is up as well. Here I will not repeat all explanation of "Oops!' pattern, you could re-read it on a link above.

    Now market has reached first resistance of 3/8 Fib level and MPP. Those who has not jumped in yesterday could get a chance to buy on retracement that could happen on Monday. But here we still have a big uncertainty factor of Italy elections result.

    eur_d_05_03_18.

    Intraday

    Right now market stands at major COP target on 4-hour chart. Here we easily could recognize potential reverse H&S shape. This gives us clue, where to expect retracement bottom and our entry point. Depending on what will happen in Italy - retracement could start differently. In a case of upward gap opening, market could open around OP and start retracement then. In general this will not change overall setup. We do not care much from which level retracement will start, we just need retracement to buy.

    eur_4h_05_03_18.

    Hourly chart has turned to "Sell". Following the harmony of reverse H&S, it seems that most probable downside destination is K-area of 1.2248-1.2266 and WPP.
    eur_1h_05_03_18.

    Conclusion:

    Situation on EUR shows solid upside potential. We do not know what results of Italy election will be and how it will impact on markets, but according to current situation, it seems that area around 1.2250-1.2260 will be suitable to taking long position.



    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.
     

    Attached Files:

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  2. Lolly Tripathy

    Lolly Tripathy Master Sergeant

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    Thank you so much sive sir...
    Cad will be the good choice instead of gold..
    God bless you
    Keep doing great work...
     
  3. Stag

    Stag Sergeant

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    EURUSD

    There is not much to add to my earlier posts. Many times price gaps will occur in a weave 3 position and almost in a wave 3 of 3 position.

    Given that the price is still below the critical key level at 1.2355, a rally above this level would give credence to the idea wave (4) low was in place at 1.2154 and wave (5) is unfolding. For the same reason we are in a phase where a gap opening would fit well either direction - but preferably up (for the bearish 1-2-1-2 scenario see alt count):

    EU_180302_h1.

    "Bonus track"

    For those who cares, please find below a step-by-step tutorial on how to apply the Kennedy Channeling Technique using real-life examples.

    3 mins only, the shortest training material I have ever made.

    Enjoy!

    KCT-3min-tutiorial.
     
  4. Joh

    Joh Sergeant Major

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    Thank you Sir Sive for your never ending wonderful reports and thank you for Stag's addition..

    Thank you Stag for your reports/charts :) Crikey wish i had half your brains. Will watch with interest :)
    What is the ETA of reaching 117 29 area approx. any suggestion?, as tomorrow the result of Italy may bring another yet fly in the ointment?
     
    #4 Joh, Mar 3, 2018
    Last edited: Mar 3, 2018
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  5. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Good stuff, Stag! And presentation is also cool.
     
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  6. Stag

    Stag Sergeant

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    You are welcome and I'm glad to hear that but stick to Sive's approach. Seriously, Sive's service provided here at FPA is simply the best you can find on planet Earth. The method he uses is coupled with a communication style that makes his analysis easy to understand for anyone.

    My forum posts are aimed at demonstrating easy-to-learn practices that can be considered as optional add-ons. These practices complement Sive's analysis and hopefully support a more confident decision-making from a different approach.

    Regarding 1.1729: if it is really to peak in March, could be hit by mid-May.
     
  7. Joh

    Joh Sergeant Major

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    Thank you heaps Stag :)
     
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  8. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Morning guys,

    So, I do not see something really new in media sphere. All talkings stand around tariffs and Italy elections. As we can see - it has no solid impact on markets.

    On daily chart trend stands at the eve to turn bullish - if EUR will close here or higher, trend will change. Daily OB stands around 1.2480
    eur_d_06_03_18.

    As market has formed expected retracement, now we could better estimate upside targets. Within few hours we are waiting for 1.24 COP. So, if you've missed entry opportunity around 1.2360 that we've specified in weekly research - you could watch for minor 3/8 retracement as soon as 1.24 Agreement resistance will be reached.
    Next target stands at 1.2480 and this is OP. But, as we have weekly grabber, it suggests action above 1.2550. That's why our major target will be XOP around 1.2609. Recall that 1.2611 is also a yearly pivot resistance 1.
    Classical target for H&S pattern will be 1.2567, which also corresponds to our analysis. Thus, somewhere around 1.2570-1.2610 this setup will be finished:
    eur_4h_06_03_18.

    On 30-min chart market perfectly completed our expectation of retracement and reaching of 1.2360-1.2380 support area. In fact, market has formed AB-CD retracement with OP inside this area. This was our entry point:
    eur_30m_06_03_18.

    Now, as we're waiting for 1.24 - market could form upside 1.27 butterfly with the same target...
     
  9. Venelin

    Venelin Master Sergeant

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    Hello, maybe flat correction in play? That will make reverse H&S more harmonic. 1h euro chart : 6-3-2018 г- 11-34-50.
     
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  10. Stag

    Stag Sergeant

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    Guys, the advance has now slowed down, prices are still below the mid-line of our base channel suggesting our super-dynamic 1-2-1-2 is not supported by the market and we have to start taking into consideration other patterns that may be under development based on what we already see - one of them is what Venelin just has pointed out.

    The subdivisions of the advance are open to different views. The advance from 1.2268 has overlapping waves which is an early warning of a potential reversal. One possible scenario is another pullback may be under development off the 1.2365 peak back to the 1.2285 - 1.2255 area before the advance resumes. In this case my circle II is still unfolding and will shift to the right bottoming around 50-62% retracement.

    Note that an impulsive breach of 1.2268 may indicate further weakness and put bullish view under pressure. Keep in mind that bullish scenarios are still valid as long as 1.2154 holds as support.

    For immediate bullish follow through we really need to see the Euro continue higher against 1.2268 in order to keep the 1-2-1-2 forecast in good standing. Trading back inside the 1-2 base channel and above its mid-line will put the bullish outlook on solid footing.


    EU_180306_m15.
     
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