Monthly Thread: May 2004

[rezo_s]

USDCHF

Hi people,

well, been as high as 1.2920 today. Became a bit suspicious, got some warning signals and decided not to enter yet and wait to see more of this pair.
Now we are back to 1.2850. The question now it same as always: which way now? up or down...?

In my opinion, closing the day at 1.2850 is a good sign. we basically failed to break above 1.29 which is a good signal. Same for Euro - failed to break below 1.1900 - only tested.

What we do now? Well, the fact that the price retreated 50 so nicely from the 1.29 is a good sign.

Now, if the price will not confidently break upside (and by that I mean above 1.3000/50 where the triangle will be broken), there are 2 options (at least for me):

1. if we see some kind of move upside during the remaining week (i.e tomorrow, Friday), it may be a good entry for short and I will be entering - I will be entering for a break. I will have to see the charts the moment of entry to ensure there are no problems. Of course, it depends how high will it go and how will the price action be conducted.

2. If the bearish view on this pair USDCHF is proven, then we will need to break the support area I spoke about couple days ago - the 1.2680-1.2720 support area. And so, the second option would be to see the break which would prove the bearish sentiment and then seek for the correction to sell.
If you recall, I spoke about the possibility of seeing the descending triangle. It can be observed on daily chart. Therefore remains a risk to see another top before possible downside move starts. Sometimes price comes back to broken line after a break and then accelerates the move. If this happens, that may be a good entry.

Good Luck!

 

[rezo_s]

Still CHF

Hello Everyone,

I am still looking at USDCHF for possibility of selling it.

If we look at the daily chart (240 min or any other that shows enough period is also ok), we see the price still trading in the triangle I mentioned last week. Similar triangle formation may be observed on Euro.
We did see some selling coming last Thursday from the 1.29 area and we moved 200 pips down on that move, but now as we see price was as high as 1.2875 today and currently its trading at 1.2830/40.
On the other hand, we have the minor trend line on 60 min charts inside the triangle formation which is providing the resistance for now. We may see the pair selling from here also.
Situation is still not very clear and that's why I prefer not to trade it at the moment, even though selling from current levels (of the resistance line) is an option, with stop above the line/today high -> somewhere at the 1.2880/90 and target same support area at 1.2680/20.
But I am mainly not a day trader and due to the fact that last week and Friday as well showed not very pleasant closing candles, I prefer seeing a break of the triangle before selling. This is my decision but you are all for your own there.

Good Luck!

Rezo Shmertz
------------------------------------

Day and 60 min Charts are attached.

 

[rezo_s]

GBPUSD

Cable is showing much more confidence recently than other majors against the USD. Even on Friday, when we saw retreat on EUR and CHF and a bit on JPY (most probably position closing), Cable made a new high on that day and even closed the day and week pretty nicely.
Same thing today. Euro is trading at the middle of its day range at 1.1967 right now whereas cable is at 1.7910 (near its day high at 1.7925).
Cable as well may be a good option to buy vs USD, but first we need to see a break above the 1.80 psychological area. In addition, 1.79-1.80 is a critical point of 2 trend lines which were formed during the recent downside movement (take a look at the chart attached). If we break higher, it should lead the price to 1.84-1.85 area, where it may meat the first resistance.

On the other hand, if we fail to break above that area, it may cause another wave of selling which may trigger a retest of recent lows of below 1.75.

So what we do?
I don't know what about you, but I will be watching it for the reaction on the 1.79-1.80 area...

cheers

 

[rezo_s]

Breakthrough of Cable and Test of Support on CHF

Hello fellow traders.

Well, the break of the levels I was talking about on GBP (now trading at 1.8130/40) happened today and I think there is more to come. This break should trigger 1.84-1.85 for the start, and I will be seeking for opportunity to long cable once there will be some consolidation/correction.

As for CHF, its currently at 1.2690. It retested the supp area again - the one I mentioned last week 1.2680-1.2720 and for now is standing in that very area. I think it will break the support soon and break of the triangle should cause the 1.22 level. I am saying it will break with this confidence, because Euro already broke similar formation on its daily charts, and therefore its only matter of time when CHF will do the same. I don't think it should take much time. Anyway, I will be seeking for opportunities to sell USD against the majors from now on.

I think (lets hope) this is the end of the choppy market, and if so, we can expect for further USD weakness and retest of the highs. This is running in front of the train, so lets give it some time.

I already mentioned the different, more confident behavior of GBP yesterday, and therefore I will almost certainly be trying to long cable.

I will update once there is some consolidation (and of course we shouldn't go below the 1.80 on Cable, which I don't think will happen according to current charts and break above 2 lines).

For charts and explanations on what I am talking about, please see previous posts in this thread. No need in new charts as its all same things.

Good Trading Everyone!

Rezo Shmertz

 

[Mr Chill]

Hi reso

I 'm enjoying your posts very much ,very interesting and great insight , Thanks

 

[rezo_s]

my pleasure

 

[Welshmal]

Certainly proving to be working, even as intra day trades the trend is the way. Long may your posts continue Rezo.

 

[rezo_s]

 

[Welshmal]

It's a great shame not to read regular postings on here. All comments and thought enable clarity of view and I for one appreciate the talent on here. When I speak of talent I'm thinking brains!

 

[Welshmal]

Ok I have a long position on the Euro/Dollar at 12135. Appreciate any views on this as I'm sitting here wondering where it may go.

 

[ivorm]

Ok I have a long position on the Euro/Dollar at 12135. Appreciate any views on this as I'm sitting here wondering where it may go.

South, unfortunately. I was long at 1.2133 from about 10:45 this morning. :-(

Regards.

 

[SallyT]

Mal,

What time did you go long? Are you still long?

 

[darktone]

Ok I have a long position on the Euro/Dollar at 12135. Appreciate any views on this as I'm sitting here wondering where it may go.

No offense but it looks like you may have nailed the top almost to the pip (hope im wrong) what sort of time frame and stop do intend for the position?

 

[rezo_s]

Hi Mal,

Sorry for the late response, but I was away on a meeting. Back now.

Well, the long eur was a bit early if you ask me. As I posted yesterday, I am waiting for some consolidation before entering. I prefer CHF and/or Cable at the moment. Even though CHF didnt break below the 1.2720-2680 area, I think its only matter of time now.

for now I think we didnt consolidate enough, because we are still trading too close to the highs/lows.

But lets take a look at euro, because you are in that trade and I will try to comment on that one what I see:

First lets take a look at daily chart. You see the formation I was talking about (same as on CHF in previously posted charts). This breakthrough indicated further appriciation north to follow, but correct entry to market is not less, but even more important that just seeing the major move happenig or predicting the move. The thing is, that we have to use stops. Otherwise one fine day we will find ourself in position loosing all the funds at once. Thats why, because of the stops, we have to choose a good entry; in order fir our 1, 2, 3% or slightly more stop order not to be hit before the move does continue/occure.

I was hit hard on this front by the market last month. For example, I was selling AUD at 7295; selling Cable at 1.81 and mant more positions, which went against me for some 50 or maybe 100 pips, before going in desired direction 200, 300 or even 600 pips.

My problem was finding good entries in this recently choppy market. Take a look at Euro since it started falling: sharp selloff one-2 days, smaller retracement for 3-4 days -> another selloff... and same thing. Just after the sharp selloff, you think its good price to sell, but you are wrong, because before the same selloff, there will be couple days of small advance... but this is past. System should be adjusted once market is in this situation... other story.

Lets get back to current Euro situation. So, on dailied, we have a clear break up, and I think we may expect for break aboce that 1.2180 resistance everyone is talking about. But the thing is that we may see the classical scenario of price coming back to broken line to bounce and resume in direction of the break.

I cannot tell for sure, because it seems very unclear. The only thing I can say is same as earlier. I am waiting for retracement which can follow. And that means Euro can also retrace lower.

At the moment the broken price stands at 2050/60, but its only for today; tomorrow this line will be even lower because its declining. So if you can afford yourself to put a stop loss somewhere below that area, it would be a good stop loss. But for how long? I thihnk a day or 2, bcos if it fails to appriciate soon, it may start declining sharply. Break back may be fatal for up-trend for nearest time. If we break back to that formation, it means the break upwards was false, or the market is still unconfident about selling USD. Either way, longing EUR wouldnt be an option anymore. At least not once we go below the 2050.

But again, this is market. We can only make a test; i.e market can go below the 2050 and then bounce from the line and resume moving higher. This is market. thats why good entries and stops are essential.

There is a chance that we dont correct below todays low of 2080, but everything is possible.

I think the worst scenario for the begining (or resuming) possible up-trend is the scenario when we break that broken line back downside. But it is not something inevitable - correcting that far.
As I said, todays low of 2080 may be te lowest we see before the resumption of upside movement...

I tried to post everything I think on euro at this point, but Im sorry if its not enough.

I will post once/if I enter positions on Cable and/or CHF.

Most probably not today anymore. Maybe tomorrow.

Good Luck!

Rezo

 

[Welshmal]

Well what can I say but thanks to all for your comments. I have closed my long on the euro, at a loss of 35. However, I can see that I made the classic error of not being fully focused when taking the long. If you look at it as a 50/50 chance then I got it wrong. Had I gone short 1235 I would be laughing now! Darktone managed to capture the moment perfectly.

Clearly we have good, interesting days ahead with Forex. Shame the Bank Holiday will enforce us to remain away for 3 days!

 

[darktone]

C....i was wrong about the short term lets see how we get on with 2200. dont forget employment figs out next friday so dont be surprised to see the market kick heels untill then.

edit: opps... theres and error on the daily chart..the swing high is at 2200 and not 2100

 

[Welshmal]

'morning. Looks as if there are a few long possibilities before we see significant changes. Cable - 18253 with a atraget of 18290 and Euro dollar 12167 to 12220. Not great moves but cash for the Bank Hol.

 

[rezo_s]

morning everyone,

... still waiting... technically we should have gotten some retracement, and I belive (hope) there is still possibility. The terror attack warnings weakened the dollar earlier than tech suggested, but I will be still waiting.

We may get entry later today, but more possible tomorrow no possible position closing... maybe not. Will see

 

[rezo_s]

Hi all!

Market will be choppy today, but I just entered long on EURUSD:

buy at 1.2211
stop at 1.2125
first target is 1.24; when/if we approach that level, we see what next.

Good Luck!

 

[Welshmal]

Good Luck Rezo. You must be one of just a handful actually trading today. Here in the UK we are enjoying a holiday; traffic jams, poor weather and DIY shops full of people!