The issue to be long is the Swap sucks, besides Yesterday we got a new 2year lower close both for London and New York. The only hope for the Bulls Is if it close May month above 1.1146, but in this case I still prefer to sell the bounce. If that happen I would not be surprised to see 1.145 area since there is unsolved business in this area. GBP/USD may develop a DRPO buy on Daily Time frame
Forex FOREX PRO WEEKLY, May 27 - 31, 2019
- Thread starter Sive Morten
- Start date
Sive Morten
Special Consultant to the FPA
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Morning guys,
So our worry on EUR performance yesterday was not in vain. Indeed, slow but stubborn bearish pressure makes EUR to drift lower. Although our bullish scenario has not destroyed totally. But we see break of relationship of bullish sentiment and the type of price action that EUR shows.
It means that in current circumstances, when our major scenario has failed, we can't consider by far new entry and need more confirmation form the market, mostly in a way of some impulse, thrusting action. With the breaking of all major levels, chances on upside continuation diminishes.
Second - we need to consider downside targets as well. Now I wouldn't look below 1.1050 area, at least this week. This is daily OS level and few extensions stands around it:
Now let's back to 1H chart where our major scenario stands. Although it was not absolute surprise for us, that EUR has dropped lower - we were prepared to this action, that EUR could reach XOP, as we have H&S and faster CD leg of our pattern. Still, on a way down market has broken through all major support areas and response on them was very shy.
Now price stands at XOP and EUR keeps theoretical chances on reversal, because lows are still valid, we have deeper, but "222" Buy as well. But reaction on XOP is anemic, no thrusting signs yet. It means that now we do not consider any new long entry by far.
At the same time, if you have bearish view and want to take position for downside breakout, to be prepared in advance - watch for upside reaction on XOP target. Gradual and slow minor AB-CD pattern could give "222" Sell:
Besides, it could be B&B "Sell" on 4H chart as well, which provides comfortable setup for short entry. Despite what target will be hit - it lets move stops on breakeven and be prepared for downside breakout. Alternative scenario is to use stop entry order around 1.11 lows and jump in during breakout. It might work as well...
The only warning on this setup - don't be short if EUR shows acceleration up from XOP. Upside retracement should be slow and gradual for this setup.
That's being said, if your longs are still alive (as mine), you could keep them and pray that market still turn up from XOP target
))
If not - IMO it would be better to not take any new longs by far.
So our worry on EUR performance yesterday was not in vain. Indeed, slow but stubborn bearish pressure makes EUR to drift lower. Although our bullish scenario has not destroyed totally. But we see break of relationship of bullish sentiment and the type of price action that EUR shows.
It means that in current circumstances, when our major scenario has failed, we can't consider by far new entry and need more confirmation form the market, mostly in a way of some impulse, thrusting action. With the breaking of all major levels, chances on upside continuation diminishes.
Second - we need to consider downside targets as well. Now I wouldn't look below 1.1050 area, at least this week. This is daily OS level and few extensions stands around it:
Now let's back to 1H chart where our major scenario stands. Although it was not absolute surprise for us, that EUR has dropped lower - we were prepared to this action, that EUR could reach XOP, as we have H&S and faster CD leg of our pattern. Still, on a way down market has broken through all major support areas and response on them was very shy.
Now price stands at XOP and EUR keeps theoretical chances on reversal, because lows are still valid, we have deeper, but "222" Buy as well. But reaction on XOP is anemic, no thrusting signs yet. It means that now we do not consider any new long entry by far.
At the same time, if you have bearish view and want to take position for downside breakout, to be prepared in advance - watch for upside reaction on XOP target. Gradual and slow minor AB-CD pattern could give "222" Sell:
Besides, it could be B&B "Sell" on 4H chart as well, which provides comfortable setup for short entry. Despite what target will be hit - it lets move stops on breakeven and be prepared for downside breakout. Alternative scenario is to use stop entry order around 1.11 lows and jump in during breakout. It might work as well...
The only warning on this setup - don't be short if EUR shows acceleration up from XOP. Upside retracement should be slow and gradual for this setup.
That's being said, if your longs are still alive (as mine), you could keep them and pray that market still turn up from XOP target
))If not - IMO it would be better to not take any new longs by far.
Sive Morten
Special Consultant to the FPA
- Messages
- 18,654
Yep. I also keep an eye on this setup
Christina Ledger
Recruit
- Messages
- 197
SO WAS I , made a small profit anyway !
Deltoid88
Master Sergeant
- Messages
- 278
Update on EUR. Price action is slow, and probability that this is wave 4 of wave 5 increase, probably we are going lower, under 1.1106 lows, and after that big bounce could start.
15 MIN chart:
How to trade this?
sell entry in zone 1.114-1.115 , SL=1.12, TP zone = 1.1050-1.1080
15 MIN chart:
How to trade this?
sell entry in zone 1.114-1.115 , SL=1.12, TP zone = 1.1050-1.1080
Sive Morten
Special Consultant to the FPA
- Messages
- 18,654
Freddy, actually, I reminded you just yesterday and your comment on weekend
It is very probable that you were right. But, final confirmation still stands ahead.
BTW, what the reaction in Mexico on D. Trump tariffs decision?
Sive Morten
Special Consultant to the FPA
- Messages
- 18,654
Good morning,
It is not much to comment on EUR today actually. Yesterday session has small range and everything stands the same here - trend is bearish, too deep retracement that barely corresponds to idea of upside reversal, as we've said yesterday. But recent lows are still valid. In a case of breakout, we're watching for 1.1050 area as a target here.
Today we have only one important statistics - PCE data on US session that could make meaningful impact on the market:
On 4H chart we still keep an eye on possible B&B "Sell". It is amazing but yesterday with 7 candles in a row market was not able to close above 3x3 DMA. The first attempt is happening right now:
On 1H chart market is still coiling around our XOP target, forming reverse H&S shape. Here we need to keep an eye on its low. Drop below it means downside continuation. Despite existense of bullish signs and validity of recent daily lows - currently we do not have on a table idea of major reversal and mostly accept only tactical upside action, something like B&B "Sell" on 4H chart. It means that upside target stands around 1.1150-1.1160 area. BTW, this is also XOP of potential H&S pattern:
Thus, we are watching for two setups. First is upside retracement to 1.1150 area and B&B "Sell" on 4H chart.
Second - drop below the "head" lows means H&S failure and downside continuation with challenging daily lows, probably.
It is not much to comment on EUR today actually. Yesterday session has small range and everything stands the same here - trend is bearish, too deep retracement that barely corresponds to idea of upside reversal, as we've said yesterday. But recent lows are still valid. In a case of breakout, we're watching for 1.1050 area as a target here.
Today we have only one important statistics - PCE data on US session that could make meaningful impact on the market:
On 4H chart we still keep an eye on possible B&B "Sell". It is amazing but yesterday with 7 candles in a row market was not able to close above 3x3 DMA. The first attempt is happening right now:
On 1H chart market is still coiling around our XOP target, forming reverse H&S shape. Here we need to keep an eye on its low. Drop below it means downside continuation. Despite existense of bullish signs and validity of recent daily lows - currently we do not have on a table idea of major reversal and mostly accept only tactical upside action, something like B&B "Sell" on 4H chart. It means that upside target stands around 1.1150-1.1160 area. BTW, this is also XOP of potential H&S pattern:
Thus, we are watching for two setups. First is upside retracement to 1.1150 area and B&B "Sell" on 4H chart.
Second - drop below the "head" lows means H&S failure and downside continuation with challenging daily lows, probably.
Possible DRPO Sell in €/£ could be developed as wellYep. I also keep an eye on this setup
FreddyFX
Sergeant
- Messages
- 510
Freddy, actually, I reminded you just yesterday and your comment on weekend
It is very probable that you were right. But, final confirmation still stands ahead.
BTW, what the reaction in Mexico on D. Trump tariffs decision?
Been short many months now and made nice results.
On the Mexico-USA tariffs, let me post here a link
https://www.forexlive.com/news/!/me...rador-we-will-be-prudent-with-the-us-20190531
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