Forex Trading Signal 9-24-2009 (Go time!)

Hey folks, it's looking like go time is at hand!

Well, it looks like the time to start getting in short for the next big move is now. The EUR/USD has broken that 1.4715 level and looks quite toppish with a complete waveform forecasting a multiday to multiweek high is in place. I'm in short on the EUR/USD around 1.4700 on a position trade with a wide SL berth of 1.5000 to start, however I plan to tighten that SL up considerably and even add to the position with a bit more confirmation. Alternatively, you can look to sell the EUR/USD for a swing trade on any small rallies that develop and work with a much tighter SL as long as you can time the trade fairly well. If the dominoes start falling like I think they will, we're talking about a 1400 to 3500 pip decline on the EUR/USD over the next several months to a year.

After the hawkish BoE minutes, the GBP/USD is a little less bearish short term, so I'd still rather wait to jump in short GBP/USD. Based on the strong BoE minutes as well, I closed out my EUR/GBP long a bit after the news for a little over 100 pips around 0.9030.

Gold looks worthy of a swing/position trade sell as well, but with stocks teetering on the edge, Silver looks even better short. For a position trade, a short here around $16.80 with a $1 or so SL above the September 17th highs seems appropriate. If stocks and the USD enter strong trend reversals as expected, we should see Silver decline below it's 2008 lows of $8.46. As with the Euro, if a $1 SL is too much for you to handle, try to short into a small rally and function with a tighter SL if need be.

Stocks are teetering right on the edge of confirming a potentially sharp reversal. A decline below 1057 on the S&P or 1052 on the ES futures will be enough to warrant an aggressive short position. Once that level goes, we're likely to get at least a several day selloff of 3-5%. There's also a very lucrative likelihood that this is the big top to Primary wave 2 we've been waiting for, and the beginning of the Primary Wave 3 decline to the 300-500 region on the S&P is starting. I will be monitoring this closely in the Diamonds Room on Thursday and likely looking to call a big short here. Naturally, I'm out of my short term long on stocks and eagerly awaiting a bit more confirmation to get short.

Why the big reversal today? Well, the FOMC came out with a statement pretty much as expected, but in stretching out their MBS purchases as they did last meeting with their Treasury purchases, it's showing a developing pattern of the removal of Fed accommodation. The BoC's Carney put it right on the money yesterday when he said "The current recovery is not self-sustaining." The recovery so far has been funded by hoardes of public money, and now that the will to extend further money is weak, and the first signs of "unwinding" of these special programs is showing up, some bulls are a bit spooked. Sentiment is at such extremes with everyone capitulating to stock longs and everyone so short on USD that all it takes is a bit of a spooking and signs of a potential top to really get a covering reversal moving with a full head of steam. For more on why I'm looking for such a strong reversal now, read the appropriate comments on this post: http://www.forexpeacearmy.com/forex...rex-trading-signal-8-27-2009-a.html#post20021

In news Thursday, there's one good trade worth watching:

1000 US Exisiting Home Sales (5.35M expected) - On a decent deviation, usually this can get the EUR/JPY and stocks cooking for a solid short to medium term move. Usually the move takes at least a few minutes to reach it's potential and on some pairs can create a nice trend for 30-60 minutes.
If it comes out at 5.50M or higher, EUR/JPY should rally 60+ pips.
If it comes out at 5.20M or lower, EUR/JPY should fall 60+ pips.

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Sir Pipsalot

 

Jerry

Hi Sir Pips !

Say, when you say a possible decline of 1400-3500pips over the coming months (Euro), are you referring to a $14 -- $35 lower position?

Thanks,

Jerry
jock@citlink.net

 

that means EUR/USD will fall to 1.3200 - 1.1200

 

wrong wrong wrong...!!ＬＯＬ　．．ｊｕｓｔ when u expected it to go down..EUR push themselves up causing an explosion. here we find ourselves with new heights. not so soon !! gotta wait for friday for G-20~

 

Just an FYI, we also managed to also position short GU before the big pop down this morning luckily. Apparently at 0330 there was a HUGE industrial order for EUR/GBP that drove the GBP bonkers and helped it lose strength. If the GU gets a nice wicked bounce now that that order has cleared, it could set up for a good short on the bounce.

We also decided to short silver in the 16.80 to 16.90 area. Just thought I'd update you all before I take a nap. Chances are we'll get enough confirmation tomorrow to short stocks as well (I hope).

 

please confirm me

Dear sir
i am planning ow to open a EUR/USD buying trade putting the take profit to 1.4888 advise me what stop loss to use to avoid loss ?
and how sure we are that euro will still go up before it goes deeply down?
Kamillo80@hotmail.com

 

Short on stocks fully confirmed this morning. I am aggressively short on stocks now.

 

i don't understand

i don't understand what is aggressive short you are saying
please explain for me

 

God Bless You

Dear Sir,

Thanks very much for your signals, i am learning a lot from you.
Hope you and your wife are enjoying your baby very much.
Have a pip filled today!
J.

 

I just wonder how did you manage to pick up the only pair that will not react to the news
as expected: EUR/USD, GBP/USD, AUD/USD, NZD/USD all nicely moved down 60-80
pips after EHS went out at 5.10M, but only EUR/JPY moved in the opposite direction.