Best Thread FXCM/DailyFX Signals and Strategies

[Jason Rogers]

Graphic Rewind: US Dollar Rises Despite Overnight Drop on Bernanke Comments

Below is a look back at the past day of trading using movements in the Dow Jones FXCM Dollar Index (ticker: USDOLLAR)

The US Dollar slipped to a new 8-day low on Fed Chief Bernanke’s comments that the target interest rate may stay low even after quantitative easing has ended, but later three key announcements gave the greenback a boost.

Past performance is not necessarily indicative of future results.​

The BoE minutes also reiterated that it too will not automatically hike interest rates when the unemployment threshold is hit. Retail sales came out higher than expected. Finally, Bullard commented that the ECB would consider cutting its deposit rate to -0.10%.

Past performance is not necessarily indicative of future results.​

The SSI-based Breakout2 strategy on the Mirror Trader platform is currently giving a signal to go long the US Dollar relative to the Australian Dollar (short AUD/USD).

 

[Jason Rogers]

Possible trend shift in EUR/USD – going long

The Momentum2 strategy on Mirror Trader has just given a signal to buy EUR/USD at current levels with a trailing stop at 1.34810. Momentum2 is a trend-trading strategy that aims to catch shifts in trend using trader sentiment as an indicator.

This signal was issued because the Speculative Sentiment Index (SSI) has hit its most extreme negative level for the past 145 trading hours at -2.7468, which suggests that the EUR/USD could be trending upwards.

 

[Jason Rogers]

Japanese Yen Remains our FX Trading Focus for Week Ahead

The Japanese Yen remains the worst-performing major currency, and the DailyFX PLUS trading strategies based on the Speculative Sentiment Index (SSI) remain well-positioned to sell into JPY weakness.

Past performance is not necessarily indicative of future results.​

In particular, the Momentum2 system on the Mirror Trader platform continues to buy into USD/JPY and JPY-cross rate gains.

 

[Jason Rogers]

Australian Dollar Might Continue Lower versus USD for 3 Key Reasons

Last week I posted about DailyFX Quantitative Strategist David Rodriguez's 3 reasons why the Australian Dollar could fall versus the US Dollar. Since then AUD/USD has dropped over 300 pips.

Past performance is not necessarily indicative of future results.​

Today, David gives us 3 more reasons why the Aussie Dollar decline might continue:

1. A major technical break sees no significant support until the psychologically important $0.9000 mark

Past performance is not necessarily indicative of future results.​

2. Aussie Dollar correlation to gold prices leaves it at risk of further declines

Past performance is not necessarily indicative of future results.​

3. Heavily one-sided retail forex crowd sentiment has left the SSI-based Momentum2 and Breakout2 systems on the Mirror Trader platform to sell into further weakness, and indeed current readings favor AUDUSD declines.

Past performance is not necessarily indicative of future results.​

If you have a trading account with FXCM, you can use your Trading Station username and password to log into Mirror Trader.

 

[Jason Rogers]

Strong/Weak Analysis: Momentum Gathering for GBP/USD

A scan of this morning’s best and worst performers via the Strong/Weak app shows that the British Pound is having an incredibly strong day, netting nearly +1000-pips cumulatively against the major currencies covered by DailyFX Research.

Past performance is not necessarily indicative of future results.​

The majority of these gains have occurred during the European session, as traders continued their rotation away from the commodity currencies (which began last Thursday) and into the European growth currencies (with price action the past three days, including today, confirming this trend).

Past performance is not necessarily indicative of future results.​

The more significant price action may be occurring in the GBP/USD, which broke above its two-month sideways range top at $1.6260. The measured move for the GBP/USD on a weekly close above 1.6260 would call for a rally into 1.6745/50, the 61.8% extension of the flag coinciding with the July 2011 highs.

 

[Jason Rogers]

EUR/CAD Trade That’s on the "Straight" and Narrow

The following chart pattern for EUR/CAD was just posted on DailyFX.com by guest contributer Kaye Lee:

Horizontal Resistance Line for EURCAD

Past performance is not necessarily indicative of future results.​

"The confluence of resistance provides a workable zone of resistance: 1.4420-1.4521.

Five Waves up for EUR/CAD

Past performance is not necessarily indicative of future results.​

"This is a shorter-term trade and is unlikely to turn the trend, but the end of a five-wave pattern should begin an A-B-C (or two-legged) pullback, which should be enough to earn a reasonable return selling at current levels."

 

[Jason Rogers]

S&P 500 Flirting with Key Support

DailyFX strategist Ilya Spivak had this to say about SPX 500, our CFD that tracks the index of US stocks:

"Prices are attempting to turn lower, as expected. A break below Rising Wedge support (1808.40) exposes 1773.90, the 23.6% Fibonacci retracement.

"Resistance is at 1813.10, the November 29 high. A turn above that eyes Wedge resistance at 1824.70."

 

[Jason Rogers]

RBA Holds Rates, Fails to Hold Aussie

The Reserve Bank of Australia kept its main refinancing rate on hold at 2.50% last night. After diving back to last week’s lows under $0.9060, the Australian Dollar has rebounded across the board.

Currency analyst Christopher Vecchio remains bearish on the AUDUSD "given general upside pressure on US yields past week, month, and quarter. A rebound today could offer an opportunity to resell the currency higher:

"Ideal selling zone over next few days: 0.9250/55 (21-EMA) to 0.9280 (descending TL off of October 23 and November 20 highs)."

 

[Jason Rogers]

ADP Employment Beats Expectations Ahead of NFP Friday

The ADP Employment Change for the month of November beat economists’ expectations of 170K, coming in at 215K while the prior print was revised higher from 130K to 184K.

USD/JPY (15-Minute Chart)

Past performance is not necessarily indicative of future results.​

This impressive beat follows the ISM Manufacturing data on Monday that showed a better than expected employment component.

Times below in GMT

If we see NFPs follow the ISM and ADP beat, we can expect renewed speculation of a small Federal Reserve ‘taper’ in December thus spurring Dollar strength and US Treasury weakness.

Past performance is not necessarily indicative of future results.

The sentiment-based Momentum2 strategy on the Mirror Trader platform just gave a signal to buy the US Dollar versus the Swiss Franc at current levels with a trailing stop at 0.8995

 

[NVP]

hey Jason

Bad Hair days in Q3 for FXCM traders ?

(kidding.....lies , damn lies and statistics)

N

 

[forex1966]

hello can any one tell me what will happen on monday to eurusd,

 

[Jason Rogers]

lies , damn lies and statistics

Great question, NVP What you're seeing here is how the leverage you use and the amount of capital in your trading account can affect your profitability. I mentioned this in an earlier discussion about trader profitability with data compiled by DailyFX research from over 10,000 FXCM client accounts: "Traders with at least $5,000 of capital tend to use more conservative amounts of leverage. Traders should look to use an effective leverage of 10-to-1 or less."

The same study showed that FXCM client accounts with a balance of $10,000 or more had a profitability rate of 44.09%. That's right in line with the data from your screenshot, since IB has a minimum balance for their accounts of $10,000. They must have forgotten to mention that fact in their ads.

I agree with you though: that guy has terrible hair!

Jason

 

[Jason Rogers]

hello can any one tell me what will happen on monday to eurusd,

Hello Forex1966,

Welcome to the forum

While no one can know the future, we can use technical analysis to help us develop an opinion of what we think is more likely to happen. It's always important to use a stop to limit your risk in case your trade idea does not pan out.

As you can see from the daily chart below, EUR/USD has been in uptrend and could be targeting a further break higher. Prices are testing resistance in the 1.3705-27 area (76.4% Fib retracement and rising channel top).

A break higher could target the October 25 swing high at 1.3831, with a stop loss set below the channel bottom around 1.3592. This idea is supported by current trader sentiment. The Speculative Sentiment Index (SSI) is a contrarian indicator to price action.

That means it tells us what the majority of retail traders are doing, so we can look to do the opposite. The latest SSI reading for EUR/USD of -4.20 means that there are 4.20 short positions for every 1 long position which is a bullish signal that the pair could continue higher.

 

[Jason Rogers]

Possible trend shift in NZD/USD – going long

The Momentum2 strategy on Mirror Trader recently gave a signal to buy NZD/USD. This goes along with an earlier buy signal provided by the Breakout2 strategy. Both strategies are based on our Speculative Sentiment Index (SSI) which means they are contrarian strategies.

Past performance is not necessarily indicative of future results.

The most recent signal was issued because the SSI reading for NZD/USD has hit its most extreme negative level for the past 145 trading hours at -1.3117, which suggests that the NZDUSD could be trending upwards. A trailing stop loss has been set at 0.82603.

 

[Jason Rogers]

Yen Pairs Engaged in Countertrend Moves - Buy the Dip?

In his trade update this morning, DailyFX currency analyst Christopher Vecchio highlighted the following:

"A scan of this morning's best and worst performers via the Strong/Weak app [from FXCMapps.com] shows that countertrend moves are afoot in the JPY-crosses as the Nikkei 225 has turned lower the past few days.

Past performance is not necessarily indicative of future results.​

"Nevertheless, when we see that today's weakest performer is the GBP/JPY, one cannot ignore the temptation to 'buy the dip' in context of longer-term price action.

Past performance is not necessarily indicative of future results.​

"After having taken a look at GBPJPY from the long side on Friday (the entry remains approximately 100-pips below current price), it may be nearing the time to add in to this trade."

 

[Jason Rogers]

AUD/USD Dives Below 0.9000 as RBA Suggests it Prefers 0.8500

The Australian Dollar took an unexpected spill this morning after Reserve Bank of Australia Governor Glenn Stevens surprised markets with overly dovish commentary:

Noting that the economy won't likely be influenced by further rate cuts, Governor Stevens suggested that the economy would fare better if the AUDUSD traded closer to 0.8500

AUDUSD 1-minute Chart: December 12, 2013 Intraday

Past performance is not necessarily indicative of future results.​

The Momentum2 strategy on the Mirror Trader platform just sold AUD/USD at current levels with a trailing stop set at 0.9047

Past performance is not necessarily indicative of future results.​

The signal was issued because our Speculative Sentiment Index (SSI) has hit its most extreme positive level for the past 145 trading hours at 3.2464, which suggests that the AUD/USD could continue downwards.

 

[Jason Rogers]

Are Gold Prices Carving Out a Major Bottom Before FOMC?

DailyFX currency strategist Ilya Spivak commented that Gold (XAU/USD) "Prices may be carving out a bullish Head and Shoulders bottom chart formation.

"Confirmation requires a close above resistance in the 1260.84-68.84 area, marked by the October 11 low and the 38.2% Fib retracement.

Past performance is not necessarily indicative of future results.​

"A break higher initially exposes the 1286.57, the 50% level. Near-term support is at 1211.44, the December 6 low."

 

[Jason Rogers]

EUR/GBP Nears Critical Juncture After UK CPI, German ZEW Data

Currency analyst Christopher Vecchio noted that a scan of this morning's best and worst performers via the Strong/Weak app shows that while "the British Pound and the Euro have been moving in near-lockstep, they are pulling in opposite directions the past several hours

Past performance is not necessarily indicative of future results.​

"Our interest is drawn to EUR/GBP, which has been engaged in a short-term countertrend move the past several days:"

If resistance near 0.8460/80 holds, that would allow the descending channel to continue to develop, and a return to 0.8400, 0.8320/30, and 0.8230/50 would be eyed.

EUR/GBP Daily Chart: May 7 to Present

Past performance is not necessarily indicative of future results.​

On the other hand, a break with a daily close above 0.8480/500 could follow the sideways channel going back to January, with targets of 0.8575 and 0.8725 over the coming weeks.

 

[Jason Rogers]

SSI: Sentiment Indicators Note Widespread Bullish USD Bias Among Traders

The latest reading from our Speculative Sentiment Index (SSI) show that retail traders are heavily long the US dollar going into today's FOMC announcement, particularly versus the Euro and British Pound.

SSI for EUR/USD is -4.28

That means there are 4.28 short positions for every long position in the pair.


SSI for GBP/USD is -3.61

That means there are 3.61 short positions for every long position in the pair.​

Not only that, but short positions in these pairs have recently increased while long positions have decreased meaning that retail traders have grown even more bullish on the US dollar leading into FOMC.

SSI is a contrarian indicator, so the combination of current sentiment and recent changes are a strong signal that EUR/USD and GBP/USD could continue higher with today's Fed comments being a possible catalyst.

On the flip side, if today's FOMC meeting turns out to be USD bullish, the resulting drop in EUR/USD and GBP/USD could be muted, since so many traders are already short those pairs.

Past performance is not necessarily indicative of future results.​

As a result, a couple of the SSI-based automated strategies on our Mirror Trader platform (Breakout2 and Momentum2) are buying GBP/USD at current levels.

 

[Jason Rogers]

SSI: GBP May Be Fed Taper Winner as SSI Turns Bullish vs JPY

The latest readings from our Speculative Sentiment Index (SSI) for GBP/JPY stand at -1.44 meaning that 1.44 retail traders are short for each trader that's long. Long positions in the pair have dropped 26.1% since yesterday's FOMC meeting when SSI was at -1.15

Past performance is not necessarily indicative of future results.​

Since SSI is a contrarian indicator to price action, the fact that the majority of traders are short gives signal that GBP/JPY may continue higher. The fact that the trading crowd has grown further net-short from yesterday gives a further bullish trading bias.