Chart Analysis for Beginners

[Pip Daddy]

EUR/USD 4-Hour

Check out how the pair was able to close below its pink 50 EMA which had been acting as support. The red descending trendline is its immediate resistance. If resistance can hold, I see a good trade setup. I will sell this pair if this current candle closes back below the red trendline. My stop will be placed 5 pips above its 50 EMA (marked "X"). There is a chance that this pair will attempt to touch its 50 EMA again. My profit target will be the blue 100 EMA (marked "$"). Keep in mind the value of the moving averages are constantly changing so remember to adjust your stop loss and profit limit orders accordingly.

 

[Pip Daddy]

USD/JPY 4-Hour

Here's something pretty interesting. I’ve drawn thick black horizontal lines to mark the round “00” numbers such as 109.00, 110.00, etc. I’ve also drawn thin gray dashed lines to mark the “50” numbers such as 109.50, 110.50, etc. Notice that when the pair breaks and closes above or below a round “00” numbers, it reaches the “50” number. It doesn’t happen every single time, but it happens very frequently! So what exactly am I trying to say? What I’m trying to say is if this pair can break and close above 113.00, there’s a very good chance one can buy and take profit at 113.50. Take a bearish view, if this pair can break and close below 112.00, one can sell and take profit 111.50. Based on past price action, both trades have a probability of winning.

 

[Pip Daddy]

AUD/USD 4-Hour

I’m very bullish on this pair. Support on this cart is found on its pink 50 EMA, purple 200 EMA, as well its blue ascending trendline. It looks like its battling with its blue 100 EMA right now. If the pair can rise above its more recent high of .7648, I see this as buying momentum returning and I’m going to jump on the bull bandwagon and buy this pair. I will buy at .7650. My stop will be below the purple EMA at .7570. My profit target .7800 which is near the pair’s swing high on the daily chart and where the dollah dollah bills be at.

 

[tm.appleby]

This is a really interesting thread.

Where do I get hold of charts for forex.

 

[Pip Daddy]

This is a really interesting thread.

Where do I get hold of charts for forex.

What exactly do you mean "charts for forex"?

 

[Pip Daddy]

USD/JPY 4-Hour

Still bouncing around. Last night, I said I would sell this pair if it closed below 112.00 and target 111.50. While it did manage to close below 112.00, I did not take the trade due to the shape of the trigger candle (highlighted in pink). With its long lower shadow or wick, a nice looking hammer formed. This tells me there’s a huge possibility of price to continue to rise even though it close below the 112.00 support. Due to this risk, I stayed out. And it’s a good thing because my predictions came true. The pair rallied right afterwards back up to surprise surprise 112.50.

The pair has closed above 112.50 and has been hovering near that level. I’m going to buy this pair now at market price at 112.60. My stop will be placed right below the low of the candle that closed above 112.50 (marked in blue). The stop price is 112.25. My profit target off course will be 113.00.

 

[Pip Daddy]

EUR/USD 4-Hour

Last week, I had predicted that this pair would fall down to its blue 100 EMA and then bounce back up. Well I was wrong. Price fell to the 1.2720s level before bouncing back up. Looking at this chart, I have a feeling this pair is simply taking a breather before rising back up to 1.2970. Immediate support is at 1.2900 which was previously resistance. Because the pair did break and close above this resistance,

I’m actually looking to buy this pair. Since I believe price might weaken a little before the rally resumes, I’m going to go long at 1.2900. My stop will be 1.2870 which is right below its next support at 1.2975. My profit target will be 1.2970.

 

[Pip Daddy]

EUR/USD 4-Hour

The .618 Fibonacci retracement seems to be a strong support level. I also see hidden bullish divergence. Notice how price has made a higher low while the oscillator has made a lower low. This usually means the pair will head up.

Look how the pink 50 EMA and .500 Fibonacci retracement level are acting as resistance. If the pair can overcome this area, I like my chances of the pair headed back up. I'm going to buy at 1.2850. My stop will be 1.2800. My first profit target will be 1.2900. I will take profit on my half of my position there. My second profit target will be 1.3000.

 

[Pip Daddy]

EUR/USD 4-Hour

On this chart, the pair managed to close below its purple 200 EMA and its old support at 1.2690. Price looks to have consolidated at the moment. I think a short rally occur before the pair continues it trip downward to 1.2500. I’m going to short the pair at 1.2700. If you look back on the daily chart, the .236 Fibonacci retracement is at 1.2700 which is resistance. On this chart, because they’re so close to each, I see resistance around the area of the 200 EMA and its old support of 1.2690. This is why I want to short at 1.2700. I’m going to place my stop above the high of the breakout candle (marked in yellow) at 1.2770. My profit target will be 1.2500. This is a classic “buy the dips, sell the rallies” trade. In this case, I’m “selling the rally”.

 

[PKFFW]

Hi Pip Daddy,

I can never see your attached thumnails.(as is the case with many posts on t2w for me) Was wondering what format they are in? The only reason I can think of that I can't see them is that I don't have the program they are formatted in. I've tried everything else.

Cheers,
PKFFW

 

[Priceman]

Hi Pip Daddy,

I can never see your attached thumnails.(as is the case with many posts on t2w for me) Was wondering what format they are in? The only reason I can think of that I can't see them is that I don't have the program they are formatted in. I've tried everything else.

Cheers,
PKFFW

Its probably your firewall my friend, check the settings for that first...

 

[PKFFW]

I have ZoneAlarms security suite installed. Can't find any obvious thing that would block thumbnails but I'm no expert with the software. Just know the basics. You wouldn't happen to know the program would you??

I can usually see word docs and excel docs and I think notepad files too. The rest of the time I can see the "attached thumbnail" thing at the bottom of the post but can't see any link to the actual attached file.

Any suggestions most appreciated.

Cheers,
PKFFW

 

[Pip Daddy]

GBP/USD 4-Hour

We have a breakout here! The pair has managed to close below its support. I’m going to wait for the pair to pull back up to test resistance and short at 1.8370. My stop will be placed above the high of the breakout candle at 1.8445. My profit target will be 1.8255 where the cash money is.

How did I get my profit target? Notice how the pair was trading in a sideway channel. The “width” of the channel is about 115 pips. My rationale is when this pair breaks out of its channel, its move will be as big as the “width”. In this cause, support is around 1.8370. I simply subtract 115 pips to find my profit target which is 1.8255.

 

[Karmacat]

How did I get my profit target? Notice how the pair was trading in a sideway channel. The “width” of the channel is about 115 pips. My rationale is when this pair breaks out of its channel, its move will be as big as the “width”. In this cause, support is around 1.8370. I simply subtract 115 pips to find my profit target which is 1.8255.

Hi Pip Daddy

I love what you're doing with these charts - targetting is the thing I find most difficult - I've got the idea on a few chart patterns, like cup and handle, but was looking at your use of extending down the size of the channel, or the 50s and 00s with the yen, those are really good applications of things that I've read about but not thought through how to apply it. Thanks!

 

[Pip Daddy]

USD/JPY 4-Hour

If this pair closes below 115.50, I’m going to sell. My stop will be placed 1 pip above the high of the breakout candle. For example, if this current candle closes below 115.00, its high is 115.72, so my stop loss will be 115.73. My profit target will be 115.00.

 

[Pip Daddy]

USD/JPY 1-Hour

I’m going short at market price at 115.50. My stop loss will be above resistance (marked in purple) at 115.85. My profit target will be 115.00.

 

[Pip Daddy]

EUR/USD 1-Hour

Notice how the pair has been trading in 60 pip wide horizontal channels. I believe this pair is a little overbought at the moment and will probably weaken before resuming its uptrend.

I'm going to buy at 1.2780. My stop loss will be 1.2710 which is below its next support 1.2720. My profit target will be 1.2900. I will move my stop to breakeven once 1.2850 is reached.

On Tuesday, July 18, I wrote:

"I will buy at 1.2500. My stop will be 1.2400. My initial profit target will be 1.2900. This will be an intermediate timeframe trade so I plan on adjusting my profit target and stops if the trade is triggered and I don't get stopped out. Stay tuned."

On Wednesday, July 26, I moved my stop to 1.2550.

I am now moving my stop up to 1.2700 which locks in 200 pips. I'm still targeting 1.2900.

 

[Pip Daddy]

USD/JPY 4-Hour

Check out the hidden bullish divergence here. Price has made a higher low while the oscillator has made a lower low. I'm going to buy at 116.00. My stop will be 115.70 which is below the recent spike low. My profit target will be 116.50. As long as support can hold at the 200 SMA on the daily chart, I think this trade will work. If support fails, I'm in trouble.

 

[Pip Daddy]

USD/JPY 4-Hour

Based on the shooting star formation at the height of today's rally which was also near its last recent highs, I believe this move has peaked. I'm shorting market at 116.50. My stop will be 116.75 and profit target will be 116.00. This is a short-term trade.

Yesterday, I talked about a longer-term trade. I had shorted at 116.00 and said to add another short position at 116.50, which I did. For this longer-term trade, I now have two lots short with both stop losses at 117.00 and both proft targets at 114.00

 

[Pip Daddy]

Eur/usd

We're still trading in a pretty tight 100 pip range here. Immediate resistance is at 1.2720. It doesn't look like that will hold and the we'll probably see the pair to its upper trading range of 1.2750. There's nothing major coming out in terms of news so I'm looking to short and trade the range. I'm going to short at 1.2750. My stop will be 1.2780. My profit target will be 1.2700.