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FOREX Pro Weekly, November 15-19, 2010

Discussion in 'Sive Morten- Currencies and Gold Video Analysis' started by Sive Morten, Nov 13, 2010.

  1. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Monthly
    Monthly trend is bullish, but as I’ve said during previous research – this is not the time to establish long-term bullish positions. The blue lines on the chart is Oscillator Predictor and the upper band stands for overbought level. So, we can see that November overbought is 1.4057 level. Market struggles with this for the second month in a row. So, if you’re bullish – that’s fine, but you should buy at pullback, when market will normalize overbought. 1.40 area is also a 50% resistance from whole move down. Market has hit it twice already, so I think that Fib level becomes weaker, but overbought still in place.
    The next area of resistance is 1.4416 just above the market.
    #1
    [​IMG]

    Weekly
    On this time frame however, there are some important changes. Look at initial price action – market has accelerated from 61.8% expansion directly to 100% expansion and hit weekly overbought. Market absolutely disrespected 61.8% target and didn’t even a bounce. Also note, that CD leg is faster than AB. Usually this kind of price action leads to 1.618% Fib expansion target that is at 1.4948, but after meaningful retracement. As a rule the depth of retracement is 5/8 Fib support from the latest swing up. This is at 1.3232-1.3358 area that includes weekly Confluence support, monthly pivot support 2 and previous highs at 1.3333.
    Market has moved below monthly pivot and reached the first area of support that we’ve talked during the previous week – around 1.36-1.3650. This is also a monthly pivot support 1. Based on the weekly chart it’s impossible to say – will this area hold the market or not. I can’t exclude the possibility then bulls will return control and reestablish up move from 1.36 area. I treat current move just as retracement lower.
    At the same time I do not see any problems with a bit deeper retracement, right to the 1.3230-1.3350 area of support. This level can show the real strength of the market. If bulls are still in charge – market should hold there. Also take the note that MACD Predictor comes in play right in this area. If we will see some MACDP failure patterns – this will add confidence in bull’s strength.
    [​IMG]

    Daily
    Daily trend is obviously bearish. Usually, when market retraces during bull trend, it retraces to weekly pivot support 1(lime dash lines). During the previous week, however, market has reached weekly pivot support 2 and strong area of support around 1.36-1.3650 that includes monthly pivot support 1, daily Confluence support and weekly pivot support 2. I will not be surprised, if market will show some bounce from this area to the upside. At the same time the sell-off was really straight. Also take a note that 1.618 Fib expansion target is just below the market at 1.3519. I do not feel very comfortable with establishing long position if important Logical Profit objective has not been hit yet.
    The main question however is as follows – if market will start move to the upside, will it be just a retracement or it will be continuation of up move on weekly timeframe? Personally, I will use weekly pivot points for that purpose and some intraday Fib levels – I’ll show you my trading plan on 4-hour chart.
    Now, the major support levels for coming week are weekly pivot support 1 at 1.3480 and strong area of support at 1.3230-1.3350. By the way, this area also is a target of daily butterfly “Sell” that we’ve discussed on previous week. Furthermore, according to classical technical analysis, if market shows breakout of some trading range to the downside, it should move to the downside at least the width of this range – this is also around 1.33 area.
    #1
    [​IMG]

    4-Hour
    And now the most sophisticated part of research – detail trading plan for the beginning of the coming week. 4-hour trend turns bullish, market stands at strong daily support – monthly pivot support, daily confluence support 1.36-1.3630 area. Market has shown nice bounce on Friday from monthly pivot support. The one thing that worries me is 100% expansion target just below the market at 1.3512. This is also daily 1.618 Fib expansion by the way. As it was with 0.618 Fib expansion, so it could be with 100% Fib target. Market can reach it before starting a retracement up. Also it very close to weekly pivot support 1 at 1.3480.
    Just above the market very strong area of resistance at 1.3779-1.3840. That’s the key. This area includes weekly pivot and intraday Fib confluence resistance. Also take a look at small ABC. 0.618 Fib expansion target is at 1.3782 – just above the previous highs. 1.3722 is no longer Fib resistance, because it was broken already. The next target is 100% Expansion at 1.3860 – very close to resistance. Personally I will be watching, how market response in this area. If it will fail there – then it will be just a retracement up, and down move will continue. If it will break it to the upside – then the next short-term target is 1.3987-1.4005 area – 1.618 Fib expansion, weekly pivot resistance 1 and Fib resistance.
    [​IMG]

    Conclusion:
    Long-term.
    EUR has bullish bias but it overbought at monthly time frame. It’s not the time to establish long-term bullish position. Wait for retracement lower.
    Short term
    Market has reached first area of weekly support at 1.36. The next and crucial area for up move is at 1.3250-1.3350. Due to overbought at monthly chart, I think that chances of retracement lower is greater, than reestablishing of long-term bull trend currently. At the same time, we can’t exclude the market shifting to trading environment. It means that it will behave well on intraday charts but turn to consolidation on daily time frame.



    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. ochills

    ochills Master Sergeant

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    thanks Sive for your incredible analysis. last week work perfectly base on your analysis
    pls do help me with your UTUBE Links for this VIDEO
    I can not download video directly from FPA exept from UTUBE
    pls help
    thanks Sive
     
  3. melvin king

    melvin king Recruit

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    Sive

    Sive thank you for your Analysis you are the best
     
  4. Joh

    Joh Sergeant Major

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    re Sive's E/U thread

    Hi Sive,

    No-one can beat your superb charts and written explanation re various currencies -I read and reread them -absolutely fabulous you are a Giant
    thank you Sive again -Joh:)
     
  5. Bspargo

    Bspargo Recruit

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    HI Sive, thanks again for you great analysis. I'm wondering whether you have an opinion on GBP/USD at the moment. I am trying to learn from what you share with us and am looking out for the various patterns. So i have had a look at the GBP/USD 4hr chart and am wondering whether ther could be a butterfly pattern developing here?? Am thinking the top of the left wing would be starting on the 4th or 5th of November and that maybe the right wing is about to develop, potentially there is a bullish opportunity for us here to get on the right wing expansion?? Would be keen to hear your thoughts (i still consider myself fairly new to forex so anything i can learn is great). And once again thanks so much for the work you are putting in every day to show us these trading tips!!!
    cheers - Ben.
     
  6. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Hi, Ochills. During the resent time YouTube bugged much. So, I've informed FPA Administration about that. Maybe they will invent something.
    But, the way on placing the video doesn't depend on me. They've said that I have to place it on YouTube, so I do this...


    Hi, Ben
    It will be much better if you'll attach the chart with your notes.
     
  7. Bspargo

    Bspargo Recruit

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    OK, chart attached. As I see it the 'middle' of the potential butterfly is close to 0.618 resistance from A (where the red line starts on the top left) to B. There seems to be a fair bit of resistance recently to move above 1.61815 (marked with grey continuous horizontal line). Price is currently sitting between weekly and daily pivot points. MACD is showing the beginning of a trend to the upside (though maybe not very strongly yet). I am suggesting that if price can break out above weekly pivot and then above the 1.61815 mark then there is potential for a butterfly style move upwards to the 1.27 expansion of AB, which is approximately 1.63932. Obviously there is some daily and weekly pivot resistance at 1.63221 - 1.63301 (marked R3 and R1 respectively), this may have to be the initial target for the trade.
    Anyway, let me know your thoughts!!!
    cheers - Ben.
     

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  8. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Actually, I've already took a look at it. Yes, the butterfly is possible in there, but not from that point, that you've marked as A. You should move A point a bit lower to the high at 1.6180 roughly.
    I know, that you do not see it, but daily chart has 3 stop grabbers that can lead to the taking over previous Highs. Also there is a weekly 0.618 Fib expansion target around 1.64
     
  9. Bspargo

    Bspargo Recruit

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    Alright, thanks for taking a look at that, is good to know that my thinking is right. Do you suggest using this high at 1.6180 because this bar was immediately followed by some strong downward bars, (i.e. it was just before a strong reaction point) or is there another reason? (ratio of middle of butterfly is better maybe?)
    So i suppose with the stop grabbers it may be possible to see strong acceleration towards the 1.64 mark? But the 1.27 and 1.618 expansion points on the intial AB are still the possible areas for resistance i think?(especially the 1.618 point as it corresponds with daily/weekly pivot resistance).
    Anyway thanks for your insights.
    Ben.
     
  10. Myles

    Myles Recruit

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    Hello Sive,
    Thank you for all your time and effort you put into your analysis, it is much appreciated.
    Myles
     

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