Thread: Forex Market Movements

Summary of the Week ending 30 July 2010

An uneventful week for me. My trades were all not triggered. All the pairs moved opposite to what I projected them to be.

Let me now try to review and project for the coming week.

EURUSD
I am expecting the EURUSD to reverse last week as there is a doji formed on the weekly chart occurs just at the top of a very strong uptrend for the past 5 – 6 weeks. I am actually looking to trade the reversal but the EURUSD seems to start to consolidate at around 1.2950 - 1.3045 and have tried numerous time to closed above 1.3000 but failed to do so.

It eventually closed above 1.3000 maybe due to the news release of the German Unemployment Rate. The price start to test and managed to break the next level of resistance, but seems not to be able to close the day above the resistance for the last 2 days of trading of the week. It closed the week at 1.3050.

EURUSD created higher high after a Head and Shoulders bullish reversal formation was detected since end Jun and early Jul 2010. The EURUSD have now taken out resistance and also the 61.8% Fibonacci retracement at 1.3000 and is now aiming for 1.3090.

A clear RSI divergence could be seen. The price is creating a higher highs while the RSI is creating lower lows from 15 Jul 2010. A reversal in price is to be set in the making.

I am actually looking at 2 areas where there could be opportunity to sell. An aggressive selling area will be at the break of around 1.2940 - 1.2960. A long wick bearish candle could be seen on the last day of the trading week. This could signal a possible reversal of the EURUSD after a strong up trend.

A more conservative and more profitable entry will be at the failure of breaking the 76.4% Fibonacci retracement at 1.3262. I will look for proper candlestick pattern that signal reversal before I would recommend an entry value.

These two trades recommendation is still inline with my overall long term bearish outlook for the EURUSD.

Have a nice weekend....

USDJPY: Review and Projection for the coming Week

The Yen continue to strengthen against the Dollar. It is possible that the Yen continue to strengthen itself in the coming week, and move towards the 84.80 support. Authough Yen is strong at this moment of time, I do not look forward to the fact thaat Yen can continue its move any further beyond 84.80.

A reversal to the upside has to come soon. I am actually looking forward to this upside reversal correction since end Jun 2010. I would actually look forward to buy USDJPY as I fell that the short to mid term trend is bullish. The long term for this pair is still bearish, but who knows PIPS could still be made in the short term range.

The USDJPY touches the short to mid term uptrend support line (in blue) after last week's trading. This is the second touch of the line, which in theory does not mean anything, buy we could be on an aggressive trade to buy the pair at around 87.10.

A more conservative trade will be to wait for the failure to break the 84.80 support line with proper candlestick pattern to confirm a reversal and also with proper price action to support the move.

Happy trading...

USDJPY gaps down on the opening on Sunday. After the gap down, the price starts to recover and is now slowly moving on its way up towards the 87.00 level. I mentioned "The USDJPY touches the short to mid term uptrend support line (in blue) after last week's trading. This is the second touch of the line, which in theory does not mean anything, but we could be on an aggressive trade to buy the pair at around 87.10."

At the end of last Friday's trading, a long wick candle was formed and touching the mid to long term uptrend resistance line (in blue). With this candle formation, I am actually expecting a reversal to occur although not a clear signal as this is only the second touch of the blue line.


The reversal has started to unfold itself since this morning's trading, and as such that I made a call to buy USDJPY at 87.10 with take-profit at 87.60, 88.10 and Open Objective. Stop-loss is to be placed at 86.20.

The Yen continues its strength against the Dollar moving towards the lowest low created on 26 Nov 2009 at 84.80.

A reversal to the upside has to come soon. I am actually looking forward to this upside reversal correction since end Jun 2010. I would actually look forward to buy USDJPY as I believe that the short to mid term trend is bullish. The long term for this pair is still bearish, but who knows PIPS could still be made in the short term range.

A good area for an attempt to create a reversal will be at the all time low at 84.80. Do look out clearly as the Dollar-Yen will be approaching this area very soon. Look out for reversal candlestick pattern such as the hammer or inverted hammer to initiate an entry long for the Dollar-Yen.

I still stand to my belief that the Dollar-Yen reversal to the upside will soon be due.

Happy trading....

EURUSD created higher high after a Head and Shoulders bullish reversal formation was detected since end Jun and early Jul 2010. The EURUSD have now taken out resistance and also the 61.8% Fibonacci retracement at 1.3000.

It start its bid to break the 76.4% Fibonacci retracement at 1.3262 during yesterday's trading. It's bid failed and the EURUSD closed tha day below 1.3262 at 1.3220.

The EURUSD was consolidating between 1.3180 - 1.3240 since 1515 GMT yesterday. This consolidation might be due to the projected resistance of the 76.4% Fibonacci retracement at 1.3262.

I would actually consider a short entry at 1.3135 with take profit at 1.3000, 1.2865 and open objective. Stop-loss is to be placed at 1.3270. This entry is only valid if and only if proper candlestick pattern is confirmed of a reversal. Candledtick pattern such as the hanging man, shooting star or even the inside bar will signal a possible reversal. Do look out out for the GBPUSD as well, if you are aggressive enough.

This trade recommendation is still inline with my overall long term bearish outlook for the EURUSD.

Happy trading....

EURUSD was triggered even before I could provide my trade analysis. I was ultra busy today and as such I was not at my Netbook to provide my trade analysis.

Trade was triggered at 0636GMT and it goes into about 15 PIPS profit before retracing to -80 PIPS loss. Currently at the point of post the P/L stands at -51 PIPS.

Why a short trade was initiated? The day before yesterday, the EURUSD tested the 76.4% Fibonacci retracement at 1.3262 (12-Apr-2010 to 06-Jun-2010), but if fails to break through. The EURUSD made another attempt for the point but ends up as a bearish candle. As such, I recommended that a pending short entry be placed at 1.3135 with take-profit at 1.3000, 1.2865, and open objective. Stop-loss to be placed slightly above 1.3262 at 1.3270.

This short of the EURUSD is still inline with my long term bearish outlook for the EURUSD.

Let's hope that the trade move as I have analysed.

Happy trading....

The Yen seems to be stall out at 85.00 to 85.30. As I have mentioned "A reversal to the upside has to come soon. I am actually looking forward to this upside reversal correction since end Jun 2010. I would actually look forward to buy USDJPY as I believe that the short to mid term trend is bullish. The long term for this pair is still bearish, but who knows PIPS could still be made in the short term range".

A conservative trade will be to look out of an attempt to create a reversal at the all time low at 84.80. Do look out clearly as the Dollar-Yen will be approaching this area very soon. Look out for reversal candlestick pattern such as the hammer or inverted hammer to initiate an entry long for the Dollar-Yen.

An aggressive trade will be to go bounce off the mid to short term uptrend resistance line, which might hppen soon. An good long entry point might be in the area of 87.10 to 87.30. Look out for other confirmation factors as well.

Happy trading....

A mixed week for me. Lost my 3x0.1 short EURUSD trade due to NFP news release which caused me 405 PIPS. On the other hand, NFP also net me a 550 PIPS (Trade Lot Size = 1.0, which when converted to my usual trading lot size of 0.1, 55 PIPS on 1.0 lot is equal to 550 PIPS on 0.1 lot) profit.

This gave me a net profit of 145 PIPS for the week.

Let me now try to review and project for the coming week.

EURUSD
I had actually wanted to see a reversal for the EURUSD after it fails to break the 76.4% Fibonacci level at 1.3260. My this so call reversal did not materialized as the US NFP news release caused the EURUSD to close at 1.3279 for the week, which also took out for short trade for the EURUSD at 1.3270.

Interesting point for the coming week of trading. The EURUSD will be testing its 200 day SMA and also might be topping at 1.3370. We could actually look for for an opportunity to short it at 1.3370 when it fails to break its 200 day SMA and also when it created a top at 1.3370.

Do look out for any signals that might signal the reversal that I have been looking for. In my view, the long term outlook of the UERUSD is still bearish, and to short opportunity is still inline with my fundamental analysis.

USDJPY
What is the outlook of Dollar-Yen for the coming week? The Yen tested its physclogical level at 85.00 at yesterday's trading but fails to make a lower low than 84.80 which is the all time low since 26 Nov 2009. We can look to go long on an aggressive trade if 84.80 is broken with confirmation from either the MACD or other indicators of a Sell.

I look to 84.80 - 85.00 support to hold and the Dollar-Yen to start its upside reversal. I have been talking about this for some times and I am looking forward for it to happen. A conservative trade will be to go long at 87.10 - 87.30 with confirmation from the MACD or other indicator of a Buy.

A more aggressive trade setup will be the failure to break 84.80 - 85.00 with reversal candletick confirmation.

Do follow me closely if you would like to trade this pair.


Have a nice weekend....

The GBPUSD has been in a strong uptrend since 19-May-2010. It has went past physological barrier of 1.5000 and is now testing the 1.6000 level. The long term trend of the GBPUSD is still bearish as long as the price stays below 1.7000.

The short to mid term outlook of the GBPUSD is bullish. The GBPUSD has increased by more than 1750 PIPS since 19-May. Last week trading closed at 1.5941 and failed to close above 1.6000.

We could look forward to enter a short on the failure to break 1.6000 with proper candlestick confirmation of a reversal. Another trade opportunity will be the entry of a buy when the price break above 1.6000 with confirmation from MACD or other indicator of a Buy signal.

It seems like the EURUSD has found some resistance at its 200-day SMA. The price has reverse but there is no clear candlestick pattern for me to initiate an entry. The US is scheduled to release the FOMC rate decision today at 1815GMT or 11-Aug-2010, 0215 S'pore time. I would recommend not to look to enter any position for any US pair of currencies due to violate nature of the news release.

However, I will still be observing the EURUSD as price action remains confined in a narrow ascending channel which has formed and remained intact since July 2010 (green lines). The price is still confined within this channel and also the 200-day SMA. The EURUSD has tested the 200-day SMA but fails to break it and we could now wait for the price to break below the rising channel before entering a short for the pair. A confirmation of direction with the MACD or even other indicators will be great.



I am looking 1.3000 or even 1.2740 as my target for the short entry.