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Sir Pipsalot's Daily Market Update 11-20-2009

Discussion in 'Commercial Trade Journals' started by Sir Pipsalot, Nov 20, 2009.

  1. Sir Pipsalot

    Sir Pipsalot Former FPA Special Consultant

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    Hey folks,

    Well, things are starting to clear up a bit to the point where I feel comfortable getting back in short on EUR/USD in this region. We've seen the Euro coil up recently with higher lows and lower highs on the hourly chart tagging 78% retracements, so I think getting short around 1.4955 with a 50 pip SL makes sense from a risk/reward standpoint, as a turn south from there could make it the last peak before a reversal much lower. I think the opportunity out there is a bit clearer and higher probability though on stocks, so I'm going to go a little more in detail on that.

    On stocks, to quote yesterday's outlook:
    We started heading lower through 1098 shortly after the stock market open and worked 11 points below that level on the S&P futures in less than 2 hours. I still stand behind my analysis from yesterday and reiterate that we should see a multiday decline from this area that will probably take us through to the end of the month. From a cyclical standpoint, the first part of the months lately have been bullish with bearish latter halves forming a clear channel on the daily chart. If we get a similar 7-10 trading day decline off these highs into that trendline, that would mean a selloff to 1045-1050. Other potential support exists at the 50 fib at 1069 and the 61.8 fib at 1059, so any of those levels are good for take profits on a swing trade short.

    [​IMG]

    Also, if that trendline around 1040-1050 (depends on how long it takes to get down there) breaks, that's great confirmation for a more immediate substantial decline. For now though, this still may just be another pullback before a subsequent higher high, so it's more of a swing trade opportunity.

    In news Thursday, UK Retail Sales came out too close to expected, but a revision to the prior month gave the GU a bit of upside. There's no news worth trading on Friday, so the next news release we'll preview will be Monday's US Existing Home Sales.

    That's all for today's update. If you'd like to learn more about trading or trade along with myself and my collegues, come join us at Profit Mongers. Our subscription is very reasonable at $179 per month, and right now you can sign up for a 2 week trial to get started for only $29. This offer is for new customers only.

    To our success!
    Sir Pipsalot
     
    #1 Sir Pipsalot, Nov 20, 2009
    Last edited: Nov 20, 2009
  2. cosmopolit

    cosmopolit Private

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    Though EUR/USD have not touched 1.4955 today, your outlook for this pair have worked quite nice.

    Would you expect it to go even more down together with the stocks, or, may be, it can suddenly shot up to 1.52?
     
  3. Sir Pipsalot

    Sir Pipsalot Former FPA Special Consultant

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    I think the odds are more in line for EU going down instead of up over the medium term as you're describing.
     

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