The EURX has struggled all day at the S/R level of 100.5. The USDX is fast approaching its S/R level of 81.7 too:
I'm not trading until next week now.
'Risk on' trade appeared overnight amid reports that Central banks will take necessary action to ensure liquidity following the Greek election. The EURX has risen and is just trying to close about the previous S/R level of 100.5 and monthly pivot as I type. It has the 4 hr 200 EMA just above this level to contend with though too. The USDX has fallen and is about to run into its previous S/R level of 81.7 with the monthly pivot and 4 hr 200 EMA just tucked in below this level:
I've had a few 'risk on' TS signals form on a number of the pairs and some more look likely to form with the next candle close. I'm not sure that I will take any trades until next week though. I'll see how the indices navigate these S/R levels though first.
I'm expecting that very little will happen overnight. We'll see tomorrow!
There is still very little movement with the indices or the major pairs.
I was reading this note on FX Live (http://www.forexlive.com/). It seems that all the technical analysis in the world may be moot given the meetings and events scheduled for this w/e! The G20 push to save the Euro zone may end up sparking a return to 'risk on' even though the technicals currently point to risk off. Read it here:
Germany seems to be changing it’s tone, if not it’s tune
Written by Sean Lee
June 14, 2012 at 03:33 GMT
June 14, 2012 at 03:33 GMT
The German FinMin Schaueble has been quiet these last few weeks and there seems to be a sense that Germany is giving in to the inevitable; if you can’t beat them, join them. Even AEP in the UK Telegraph is sensing the same mood swing. The cost of a EUR collapse is simply too huge for Germany to contemplate and whilst they will continue to talk tough so as not to lose too much face, it seems that the EZ and ECB will now do whatever it takes to save the EUR.
This may start this weekend at the G20, with whispers turning into shouts that a template for a banking union will be finalised, which will then be agreed upon by the EU summit 2 weeks thereafter. Banking union will be followed by fiscal union, the only way to save the EUR.
What does this mean for the EUR? Well, the obvious reaction would be to buy it and we could see some crosses like EUR/GBP and even EUR/AUD make some major gains. If the G20 breaks with tradition and actually makes a useful breakthrough, then EUR/USD will probably be trading at 1.28 on the way to 1.30 and the crosses will all be higher.
More medium term it may not look so rosy for the EUR, they will after all only have one way of funding all these great bail-out initiatives and that is by printing Euros in some form or another. The race to the bottom can begin all over again (which partly explains the bullish Gold analysis which I mentioned earlier).
Thursday 14/6 (10.30am)
There is very little happening. The only consolation with all of this sideways chop is that the ADX, on most pairs, is heading back below the water level of 20. This makes it much easier to 'spot' the next new momentum move and trend.
Most trading chatter is about how people will be exiting positions on Friday prior to the w/e Greek elections. I don't think I will be trading this week now based on this lack of momentum and I will most likely wait until after the w/e events now.
Another useful video from Compass FX: How to keep MT4 on the same date and time:
http://www.compassfx.com/video/ip/61312/61312.html
Another useful video from Compass FX: How to keep MT4 on the same date and time:
http://www.compassfx.com/video/ip/61312/61312.html
In aeronautical terms I think the indices would be describes as being in a 'holding pattern'. They are both ranging sideways but still both contained within the flag/wedge patterns.
The broader markets fell overnight due to ongoing concern about the EU zone and further credit rating downgrades for Spain. The VIX, or fear gauge, rose a bit too and is now at 24.
I think this choppiness might continue for the rest of this week due to continued uncertainty; exacerbated by the fact that tomorrow is quadruple witching and, then, with the Greek elections over the w/e.
There are no new TS signals on the 4 hr charts; this is hardly surprising though!
It has been a very quiet Asian session. Not much movement and hence no new TS trend signals.
It is a very quiet Asian session today. I've re-considered the chart on the EURX so as to better reflect recent support and resistance levels. The 'bear flag' pattern seems, to me, to have evolved into a bearish 'ascending broadening wedge' pattern. The outcome is still the same for both of these patterns, that is, they are bearish.
In the same way, the USDX 'bull flag' pattern could now be viewed as more of an 'descending broadening wedge'. These patterns are most often viewed as bullish patterns:
The indices chopped about sideways overnight, as did most of the currency pairs. The USDX and E/U are still trading within their flag patterns but the EURX had a little break out but is now pulling back. It will be interesting to see if the EURX will hold or continue to fall away from this point after a re-test of the broken trend line:
The broader markets have rallied though with the DOW, NASDAQ and S&P500 all closing higher. One would have expected the Euro to rally along with this type of sentiment, hmmm, odd!
This choppy action means there are no TS trend signals on the 4 hr charts.
The indices are still ranging in their trend channel flag patterns:
There are no TS signals on the 4 hr charts at the moment.
The indices are still ranging and there are no TS signals.
The indices continue to trade within the flag patterns discussed over the w/e. The USDX has struggled for most of today around the 82.65 level. This is a significant level being the 61.8% retrace from the recent low back to the June 2010 high. I will wait for a break out from these flag patterns supported by TS trend signals.
TS, so far this week, has kept me out of being whipped around in the choppiness on the 4 hr chart time frame. There were great trades on the shorter time frame charts last night and I suspect that this pattern might continue. See my earlier post from today for these trades and charts.
There are still no TS signals as yet. They may still develop though. TS has, yet again, kept me out of potentially losing trades.
Do you think this is what the Ichimoku said to the Euro?
http://www.youtube.com/watch?v=pq3YdpB6N9M
Tuesday 12/6 (1 pm)
It is Quadruple Witching this Friday. See details about what this is and what impact it tends to have @ http://www.cnbc.com/id/45617442/Witching_Hour_CNBC_Explains
Still no new TS signals on any of the charts. Check out how the bear flag pattern is containing price on the E/U, for the time being at least. Then, check out how price on the E/U has bounced off the cloud pattern.
I still don't have any TS signals and the 'risk off' rally from last night seems to have eased a bit at this early stage of the Asian session.
Interestingly, this risk off easing and pull back on the USD is coming when price on the USDX is butting up against the Ichimoku Kinko Hyo Indicator cloud!
I've just had a 4 hr candle candle close here at 8am. I still don't have full TS signals on ANY of the pairs! I do find this odd but I'm going to wait until they form. I've been here before...choppy and indecisive markets on the 4 hr charts but good trades on the shorter time frame charts! See my 7.30am post.
As I suspected and mentioned in my earlier post, most of the pairs gave great and easy trend trades last night on the shorter time frame charts. These kicked in during the later London or US session:
Remember, the left hand side of the blue box denotes the Asian session, the right half, the London session and then the rest is the US session:
E/U 100 pips
E/J 80 pips
A/U 70 pips
A/J 60 pips
USD/SGD 70 pips
Swissie 70 pips
Loonie 70 pips
I woke to hear the news that the broader markets were down in overnight trading. I then expected to find that trades on my TS system would have kicked in over night, as is often the case. Well, even allowing for many of the big moves on some pairs, I still don't have full TS signals to trade 'risk off' on any of them just yet. Many are close to forming and may do so by the next candle close here in 1 hr.
The EURX has just broken out from its bear flag pattern and the USDX is nudging the upper trend line of its bull flag pattern. These patterns were discussed over the w/e:
I do suspect that when I go back over each of the pairs I will probably see great trades off the shorter time frame charts from during the US session. This is a pattern I'm becoming very familiar with!
Ichimoku Kinko Hyo Indicator: Update
I just had a quick look at the Ichimoku Kinko Hyo Indicator cloud charts for the 2 indices. It is interesting to note that price on both indices is currently re-testing the cloud zone that they broke out from yesterday during 'risk on' sentiment trading. I will be watching to see if the indices cross back through the clouds to give further confirmation of 'risk off' sentiment. If the indices do not cross back through the cloud then, to me, this indicator is pointing to trades that are 'risk on'!
Monday 11/6 Queens B'Day w/e (7.30pm)
Price action seems to be returning to 'risk off' after the morning gap up in the markets. As such, it will be a while before new TS trend signals form. Also, there seems to be some divergence between the A/U, A/J, G/U and NZD/USD which appear to be holding up reasonably well compared to the other pairs which are heading with greater momentum towards 'risk off'.
I'm waiting until tomorrow for clearer signals.
Whilst there is much 'up beat' talk about 'risk on' sentiment I'm yet to see this reflected in the indices:
I'm waiting, as per my weekend Indices Analysis, for a clearer picture.
It is wet and miserable here and our w/e house guests have now left. We have a holiday Monday here and an afternoon of AFL ahead of us I suspect.
The market gaps produced a lot of trend signals but I'm going to wait to see how the Europeans react to the w/e news.
E/U: the E/U gapped up and is now sitting above the major S/R level of 1.262. This level was previous support that had, of late, become resistance. This is a huge level to negotiate and I want to wait to see if this level will now become support again or, whether, price will simply fall back down again through this level. Price is currently wedged between this 1.262 level and the monthly pivot and it is still trading within the Bear Flag pattern that was discussed over the w/e:
Ichimoku Kinko Hyo Indicator:
This indicator has been brought to my attention by a stocks and options trader I am checking out. I'm keeping an eye on the indicator and seeing how it correlates with my own analysis. I am certainly no expert on this indicator and have essentially just picked up a single mere basic at the moment. That is, to go SHORT if price is under the 'cloud' and LONG if it is above the 'cloud'.
It is interesting to see how this indicator is tracking the indices at the moment. For the USDX: price was above the cloud, thus 'long', until early last week, it was in the cloud towards the end of the week (thus turbulent: that's my individual 'spin' on this indicator!) and is currently below the cloud. Thus, one might be looking for shorting opportunities based on the 4 hr charts. Care is needed though given the gap situation from market open.
The inverse pattern is noted on the EURX. Price was below the cloud until early last week, hence 'short', was in the cloud towards the end of last week (hence turbulent) and is currently trading above the cloud:
Now, if I look at this indicator on the E/U 4 hr we can see that price has emerged to the upside of the cloud and is also above previous S/R in the 1.262 level:
So the Ichimoku Kinko Hyo Indicator seems, to me, to be suggesting to go LONG on the E/U based on 4 hr chart trading. Personally, like mentioned in my w/e updates, I will wait to see if 'risk on' continues and for price to close above the monthly pivot and 4 hr 200 EMA though.
My fun in playing with this 'cloud' based indicator sort of correlates with the rain we are having!
There were significant gaps at market open in favour of 'risk on' sentiment given the w/e release of positive news concerning a Spanish aid package and good Chinese data. Price on the indices has jumped to the other side of the flag patterns:
It is a public holiday in Australia today so our market is closed but other Asian markets are opening up much higher.
The E/U has gapped up higher but is still struggling at the monthly pivot:
The Aussie pairs are a bit confused about which way to head and currently forming indecision style, 'spinning top' candle patterns:
I have to go out for a couple of hours and will miss the noon candle close.
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