Trading Week 28/5/12

Friday 1/6 (5.30 pm)

Not much to report really. The USDX continues to climb for now but remember it is NFP Friday.

The Cable trade I flagged last w/e though is now up around 250 pips! Hooley dooley!

I'm cooking dinner tonight for some friends who helped me whilst I was sick last year. I hope the evening goes as well as this trade!  I'm listening to this whilst cooking.....http://www.youtube.com/watch?v=gzD6eGL6gus

Friday 1/6 (12 noon)

I'd actually be cautious shorting any Yen pair in the short term. Just saw this on FX Live:

Japan senior MOF official: Will respond aggressively if excessive Yen moves continue against EUR and USD

Written by Sean Lee
June 1, 2012 at 00:32 GMT 

• Monetary policy is important but shouldn’t rule out intervention
• Current Yen appreciation driven by speculation

PS: This Dean Malone video is worth watching too:
http://www.compassfx.com/video/ip/53112/53112.html

Friday 1/6 (10 am)

The USDX is still looking bullish at this stage:

It is NFP Friday today so I'm being careful with any potential trading but there a some tempting trdes that look like they're setting up!

The NZD/USD which is still teetering near a significant triangle trend line. A break of 75 would interest me for a short:

I'm also watching the A/J which, I have to admit, I don't like to short but it does seem to be worth watching at the moment. The A/J, like the N/U, is also hovering just above a significant bottom trend line of a symmetrical triangle on the monthly chart. You may recall that a break out of the A/J from the upper region of this triangle some weeks ago gave a few hundred pips. I've re-drawn the trend lines since then though. A break, close and hold below this trend line might tempt me to short further here though. There is major support at 74 and then again at 72 though to keep an eye on:

Friday 1/6 (8am)

The USDX is still holding up for the time being:

The only real stand out in the currencies overnight was the Cable. The G/U has now fallen over 200 pips since it broke down from the significant trend line level of 1.56 that I discussed over the w/e. I caught some of the move at least but I'm sure that many would have caught more of this  than I did!

Thursday 31/5 (3.30 pm)

This week has been another FANTASTIC week for my TradeSpotting system and.... a much better week for me!

Tradespotting identified trend trades on 7 pairs this week that yielded a possible 800 pips. I didn't catch all of this movement but got some of it!

E/U: 120 pips

E/J: 170 pips

A/U: 100 pips

A/J: 100 pips

G/U: 120+ pips on the break of the trend line I discussed over the w/e!

USD/SGD: 90 pips

Swissie: 90 pips

My remaining 2 trades were stopped out: the Swissie for 40 pips and the USD/SGD for 50 pips.


Thursday 31/5 (2 pm)
The USDX has slowed a bit at the 83 hurdle level:

I would not be surprised to see the currencies stall a bit now given the major moves we have had.

It has been a fantastic couple of days for TradeSpotting. My TS system continues to thrive but I have not done it nearly enough justice over recent weeks. Some of this is 'time-zone' related for sure but, some is just my poor trade management! I do feel today though a bit like a school kid who finally studied and achieved a good grade and pleasing result! 

I'm going to be spending more time over the next few days plotting stocks to buy or option trade. Pullbacks like this get me very excited! I am rather easy to please though!

PS: I am going to watch the NZD/USD though. A break, close and hold below the 75 level and triangle trend line will have me trading it!

Thursday 31/5 (10am)

I won't be entering any new trades for this week. Tomorrow, being the first day of the new month, might give some reversal from 'risk off' as is often the case.

Trade Update

G/U short: 100 pips. Profit target reached.

A/U short: 100 pips. Profit target reached.

A/J short: 100 pips. Profit target reached.

Swissie long: Up 40 + pips. Stop to b/e.

USD/SGD: Locked in 50 pips. Trade still running.

Thursday 31/5 (6am)

Continued Euro zone fear sent the USDX up further overnight.

This has helped all of my signals from yesterday for sure. I am guilty of a bit of revenge trading in light of missing and /or mis-managing so many signals from earlier in the month.

My trades from yesterday:

G/U short: 100 pips. Profit target reached.

A/U short: Locked in 50 pips. Trade still running.

A/J short: Locked in 60 pips. Trade still running.

Swissie long: Up 40 + pips. Stop to b/e.

USD/SGD: Locked in 50 pips. Trade still running.

I took the Swissie instead of the E/U but the E/U went for over 100 pips too. I didn't take the E/J but it went for over 120 pips.

Wednesday 30/5 (7.30 pm)

The USDX is holding above the key 82.6 level. There is over an hour until this 4hr candle closes though. You can see from the chart how price struggled throughout today at this significant fib retrace level:

I have had TS signals to:

SHORT: E/U, E/J, A/U, A/J and G/U

LONG: Swissie 

Wednesday 30/5 (1 pm)

The USDX has had a 4hr candle close right on the 61.8% fib level of 82.6. 

It remains to be seen if price will continue upwards from here or bounce back from this significant level.

So far, I have very new TS signals to short the E/U and G/U and to long the Swissie. I'd like to see more signals kick in though.

Wednesday 30/5 (10 am)

The 61.8% fib level is proving a bit of a barrier for the USDX.

There is AUD data out at 11.30 which may move things a bit.

I'm getting some 'risk off' signals looking like they're trying to form up.

Wednesday 30/5 (6am)

The post Memorial Day trading has been an interesting one. These days are often positive for stocks and the broader markets have indeed closed around 1% higher, with some risk on appetite evident, but we've also had a rising USD and falling Euro. Is this the beginning of the unraveling of the usual USD/Stocks correlation???

The USDX is currently struggling a bit though to get over the 61.8% fib level that I discussed in my w/e post. This is a 61.8 % fib retrace from the recent lows after the last high.  (see the weekly chart below)

This 'risk on' sentiment with stocks did not carry over into the currency markets though. The usual risk on trail blazers, the A/J, A/U and USD/SGD, have all been pretty flat with no new trend evident, for now at least. Gold and Silver have fallen with the rising dollar though.

Tuesday 29th (9 pm)

Still no movement. No new trends.

Tuesday 29th (7 pm)

Still not much movement with the indices. No new TS signals just yet. I suspect the US session might kick start things though.

Tuesday 29th (2 pm)

Still no change from earlier today. No TS signals yet.

Tuesday 29th (9.30 am)

There isn't much movement and I suspect today might be quiet until other markets come on line.

I don't have any trend TS signals yet.

Tuesday 29th (6am)

As suspected, trade was pretty flat across all markets last night with low liquidity. Both indices have merely range traded. Note the ADX on both indices charts; there is very little momentum for either direction.

There isn't much scheduled news for today.http://www.forexfactory.com/calendar.php. 

There might not be much action until later during the European and US sessions.

Monday 28th (8.45pm)

I still have signals on the A/U, A/J and Loonie but, like I said earlier, I'm loathe to take them with the USDX trading up from the 81.7 level and the EURX trading down from the 100.5 level.

Monday 28th (6pm)

I have received a few 'risk on' signals but I'm loathe to take them with the USDX still trading above the 81.7 support level and, also, with many markets being closed today.

The A/U and A/J have also broken trend lines BUT...I'm still going to wait.

Trading Week Analysis for 28/5/12

There is a public holiday in the US on Monday so I may not trade until after then.

E/U: Price has broken below the key support level of 1.262. I suspect that price might re-test this level before any further fall.  BTW: The bullish inverse H&S pattern on the monthly chart is still valid.

I will look to SHORT the E/U on any new TS signal and if price holds below the 1.262 level. 

I will look to LONG the E/U if ‘risk on’ sentiment returns and it price breaks back above the 1.262 level and above the bear trend line.

E/J: I would look to LONG the E/J on a new TS signal, a return to ‘risk on’ and if price rallies, breaks, closes and holds above the bear trend line on the 4 hr chart.

A/U: Price has opened higher this week and is currently trading above the bear trend line. This candle has an hour to close yet though.

I will look to SHORT the A/U on any new TS signal and if price trades below the bear trend line.

I will look to LONG the A/U on any new TS signal, if ‘risk on’ returns and if price breaks, closes and holds above the bear trend line.

A/J: I might look to LONG the A/J on a clear TS signal and a break, close and hold above the bear trend line and if ‘risk on’ sentiment returns.

I won’t SHORT the A/J.

G/U: Price is trading above a significant trend line at the 1.56 level.

I would look to LONG the G/U on a new TS signal and if ‘risk on’ returns.

I would look to SHORT the G/U on a clear TS signal, if ‘risk off’ sentiment remains and if price breaks closes and holds below the 1.56 level.

USD/SGD: This pair has moved up to 300 pips since the initial triangle break out I flagged a few weeks ago!

I will look to SHORT the USD/SGD on a clear TS signal, if ‘risk on’ sentiment returns and if price breaks, closes and holds below the bull trend line.     

I will look to LONG the USD/SGD on a clear new TS signal and if ‘risk off’ sentiment remains.

Swissie: This pair has moved up to 300 pips since the initial ascending triangle break out I flagged a few weeks ago as well!

I will look to LONG the USD/CHF on a new TS signal and if ‘risk off’ remains.

   

I will look to SHORT the USD/CHF on a new TS signal, if ‘risk on’ returns and if price breaks, closes and holds below the bull triangle trend line.

U/J: I won’t trade this pair due to its irregular trading patterns.

Loonie:  This pair has moved up to 270 pips since the initial symmetrical triangle break out I flagged a few weeks ago too!

I would look to LONG the USD/CAD on a new TS signal and if ‘risk off’ remains.

I would look to SHORT the USD/CAD on a new TS signal, if ‘risk on’ returns and if price breaks, closes and holds below the bull triangle trend line.

Silver: The triangle trend line is giving Silver some grief. It is just hanging in above this on the weekly chart but struggling to hold above it on the 4hr chart.

 Gold: I’ve got Gold trading within a descending wedge pattern on the weekly chart. These are bearish continuation patterns. Gold is rallying off the bottom levels of this pattern at the moment though on the 4hr chart. Price could bounce around within this pattern for some time though as there is plenty of room until the apex. I’m watching Gold though closely as it is quite highly correlated with the AUD.

Indices Review for Week 28/5/12

I will post my Trading Week Analysis of my main currency pairs either later tonight or tomorrow. Remember, it is a holiday in the USA tomorrow and in parts of Europe. 

USDX

Monthly: Ranging but currently in an uptrend.  The current monthly candle is VERY bullish and engulfing. Price is approaching the 61.7% fib re-trace from the most recent low to the previous high. I’m not the only person on the planet that will be seeing this trading phenomenon near the 83 level. I would not be surprised to see some reaction or hesitation around this level. I would also expect that the monthly 200 EMA at the 84 level might give any continued up movement some grief too.

Weekly:  Trend up. Price broke through the previous high of 81.7.

Daily:  Trend Up.  Price has rallied for most of May. A new bull trend line is evident.

4hr: Trend Up. Price is doing impersonations of the Very Hungry Caterpillar! The previous resistance level of 81.7 might become new support. I’ll be watching for any pullbacks to possibly bounce back up from here. Failure of the 81.7 level to support price would be a rather bearish signal for me though.

Thoughts:  Euro zone news drove most of the trading action last week and may continue to do so again this week. It seems like a lot of the currency moves would love an excuse for a slight pullback but there is little sign of any good news needed for such a shift in momentum, even if only temporary.  Continued caution is required.

I will look to LONG the USD in pairs on valid TS signals if price on the USDX keeps rising and holds above the 81.7 level. I will look for signs of weakness though at the 83 and 84 levels as mentioned above.

I will look to SHORT the USD in pairs on valid TS signals and if price on the USDX moves back down below the 81.7 level and breaks, closes and holds below the bull trend line.

As always, Fundamentals, by way of Euro zone dramas and news announcements, continue to be triggers for price movement on the indices.  These events can always have the potential to undermine all Technical analysis.

EURX

Monthly:  Trend down. This chart is essentially the same as it has been for the last few weeks. Price has finally broken down through the 100.5 level and from trading within a large descending triangle pattern.  The current monthly candle is very bearish. Price is at new low levels now.

Weekly:  Trend down. Last week’s candle was very bearish.

Daily: Trend down. Friday’s candle was an ‘inverted hammer’ candle stick pattern though which is viewed as a sign of potential reversal. 

4 hr: Trend down.  Quite a few indecision candle stick patterns evident though at these significant low levels with Dojis and more ‘inverted hammers’.

Thoughts:  I will look to SHORT the Eur in pairs on valid TS signals if the EURX continues to trend down below the bottom, broken, triangle trend line value of 100.5/100.6 area.

I will look to LONG the Eur in pairs on any new TS signal and if the EURX can rally back up and break through the 100.5.