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FOREX PRO Weekly November 14-18, 2011

Discussion in 'Sive Morten- Currencies and Gold Video Analysis' started by Sive Morten, Nov 12, 2011.

  1. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Monthly
    It is hard to add something on monthly chart. Most important event is the same – market has failed to change trend to bullish. Currently we see that market is forming something like inside bar, and this is not a surprise, since previous month’s action was really tough. Based on our analysis and relation with dollar index, the most expectable action is move to 1.18 in nearest 6 month. Currently there are no patterns that could negate this assumption.

    Still, although long term bearish bias holds, investors will not be hurry up for two reasons – they need some more certainty with EU problems – Greece and mostly Italy, and because of the end of the year. From that perspective it is more probable that market will turn to some wide range trading in nearest couple of months. That’s why our analysis style till the end of the year mostly should be based on searching of clear patterns to trade – as in terms of entering the trade as in terms of taking profit. Obviously these patterns will be on lower time frames.
    On monthly chart we see that nearest downward target 1.2905 in Agreement with 1.3039 Fib support. Market is neither at oversold nor at overbought, trend is bearish – that is all that we need from monthly time frame currently.
    [​IMG]

    Weekly
    Analysis of weekly chart is a bit knotty. Trend is bullish, market is neither at oversold nor at overbought. After hitting of 1.618 target in Agreement of minor 0.618 support level market has jumped out. Currently we see that there are two contradictive patterns could be formed here. First one is bullish stop grabber. During past week market has tried to shift trend bearish, but failed and closed above MACDP line. Second one is bearish dynamic pressure, and I think that this pattern has more chances to succeed, taking in consideration overall situation in EU and technical issues on monthly chart. We see that although trend has turned bullish, price action does not support it. But take a look – previous stop grabber has been failed, since market has formed new stop grabber and established new low. Simultaneously, as we’ve said this is absolutely in a row with dynamic pressure behavior - for dynamic pressure is typical to create lower highs and gradually move price lower and lower. It could turn so, that this contradiction will not be solved fast, since for that purpose market has to take either high at 1.4166-1.4241 and reach the target of Stop grabber or take the low at 1.3484 and erase it. So, as you can see both of these patterns are linked with each other. Nearest target to the downside is 1.3369 – 0.618 Fib extension from most recent AB-CD pattern.
    [​IMG]

    On the second chart I want to discuss with you another scenario – potential H&S pattern. Although it is preferable to see more harmony with it, still, it has some chances to succeed. Left shoulder a bit greater than 1.618 to head, but this could be explained that market a bit exceeded to upside to reach 1.618 of AB-CD pattern. At the same time right shoulder currently stands precisely at 1.618 to the head that is quite common for H&S patterns. Head is a bit flat and wide, but this is not forbidden. From that perspective, minimum target of this pattern is 1.1950, standard target is around 1.13-1.14 – that is coincide with expectations due correlation with Dollar Index, that we’ve discussed two weeks ago. Speaking about current price action - I think that bearish dynamic pressure has more power currently than stop grabbers, besides, one of them has been cancelled already.
    [​IMG]

    Daily
    On daily time frame trend is bearish, no oversold or overbought. Although market has shown downward breakout as we’ve suspected, currently it almost has returned right back. During previous couple of sessions we’ve said that higher retracement up is possible and market could reach 1.3730-1.3770 Fib resistance area – that has happened. Commonly, when market shows fast return after solid plunge, this carry some view of momentum shifting, and in most cases, market continues upward further. So, we can’t exclude reaching 0.618 resistance at 1.40 area roughly. As we said initially, technically this is first run down after solid move up and due upward momentum market could show deeper upside retracement. This is also combine with some relief from EU.
    [​IMG]

    4-hour
    Here I see some confirmation to upward assumptions. Trend is bullish, we see nice thrusting bar to the upside, so market has nice chances to continue, and at least bullish trend suggests this. Now is most suitable time to remember our butterfly buy pattern. I’ve drawn potential targets of that pattern – 1.27 at 1.3986 and 1.618 at 1.4123. First area is more probable, since it is closer to 0.618 major Fib resistance.
    [​IMG]

    Hourly
    Trend is also bullish here. We see solid acceleration to the upside. Still, market has not quite reached 1.618 target at 1.3823. Even if market intends to show reversal down, it should reach this level. At the same time it should not show deep retracement. 1.3676-1.3683 should hold, this area is very close to pivot also. What will be after that – it is difficult to say – market could form butterfly sell during this retracement with target around 1.3820 also. But what we do know is that price behavior around 1.618 target will tell us what will happen next. If market will accelerate through it – be ready of reaching higher targets, if it will reverse down and move below trend line again – this could be the sign of downward continuation with major long-term tendency, especially if market will form some reversal pattern, as we’ve said.
    [​IMG]

    Conclusion:
    In the beginning of the week we have to focus on short-term charts, since as weekly as daily charts do not show clear patterns and could bear as upward as downward move without drastical changing of total situation.
    On Monday we may count on reaching at least 1.3820-1.3830 area. Depending on how market will behave after that we may judge about further price action.


    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. rashidin5178

    rashidin5178 Sergeant

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    H&S on H4?

    Hi Sive,

    Thanks a lot for your kind effort. This as always could help a lot of us.


    By the way, I just want to confirm with you another price action possibility. On H4, I think H&S pattern just occurred but for me not too harmonic. The target of this pattern somewhere around 1.3225. Maybe market will move up to 0.886 retracement around 1.3820 and then turn downward after that. One more thing, in my opinion, market does not break yet 0.786 resistance from previous down swing. Also, on H1 we may have gartley 222 around 1.3820. How about the chances of this pattern maybe fail based on current price behaviour? What do you think, Sir?:confused:

    Thanks and Best Regards.
     

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  3. Jyotiprakash Pal

    Jyotiprakash Pal Sergeant

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    thanks for great insights on Euro/Usd sir .. :)

    Sir lil bit confuse on Eur/Jpy Market is above daily Piviot ..

    But Pivot Point 1st Level Resistance at 106.52 also 106.33 is
    50% Retracement from 13 Week High/Low ...

    in that case ... do i have to wait untill market go below Piviot ? :err:
     

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  4. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Hi Rashidin,
    I do not like this H&S either, probably even current reverse H&S is more probable...
    I agree about "222". That's why I also tell in analysis, that 1.3830 area is crucial in nearest perspective.

    Hi Jyotiprakash,
    at my humble Opinion on 4 hour chart market is forming AB=CD or "222" Sell, if you want. Target of AB=CD stands precisely at pivot. So, chances that market will reach it are significant.
     
  5. rashidin5178

    rashidin5178 Sergeant

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    Hi Sive,

    Thanks for your answer.

    For the purpose of education, it is very appreciated if you can elaborate more detail why you don't like this H&S pattern? Is it because of unharmonic price action around shoulder area or too much noise to call it H&S or something else?

    Speaking about H1, H4 '222', what is your preferred target actually? Somewhere around 1.3680 (.382) as per your analysis?

    Have a nice weekend, Sir.

    Thanks and Best Regards.
     
    #5 rashidin5178, Nov 12, 2011
    Last edited: Nov 12, 2011
  6. Jyotiprakash Pal

    Jyotiprakash Pal Sergeant

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    Oh My god!!! u r life saver sir ... did i draw it correctly ? :confused:
     

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  7. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Hi,
    Actually I've spoken about this AB-CD. I hope that I've understand you wright.
    You've asked should we wait to some pullback or not?
    From that picture, very probably that market at least complete AB-CD
     

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  8. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Yes, here is lack of harmony, shoulders are too blur, shape of the head is also a bit skewed.
    Second, this pattern has formed during retracement in choppy price action.
    About "222", well, it will depend on how market will act around 1.3830. If there will be reversal, then probably we can count on significant downward continuation.
    1.3680 probably could be reached before market will continue to 1.3830.
     
  9. Jyotiprakash Pal

    Jyotiprakash Pal Sergeant

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    thanks sir ya i do want 2 short EJ .. ... but the AB-CD i find is also right?,but its not so harmonic !!!
     
  10. rashidin5178

    rashidin5178 Sergeant

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    Thanks a lot Sir for your reply and sorry to disturb your weekend.

    Thanks And Best Regards.
     

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