Benjamin Lilley’s posterous

EUR/USD Daily analysis - End of the trading week.

The week is over, I hope you all had a good one.  There were some nice moves in there that I hope you were able to take advantage of.  There will always be more trades out there.  Stay the course and stick to your rules.

On the weekly, it seems like price may actually break that 21 EMA this time around.  MACD and Stochastics are still down, and they both have a long way to go before becoming oversold.

On the Daily we are definitely pointed down.  We are still in the major consolidation that began in March between 1.6000 and 1.5385.  The 5/8 is wide open to the downside, with MACD in full support.  The 21/55 has lost and is continuing to lose angle and separation, it looks like it may cross in the next few candles.

On the 4 hour the MACD is looking kinda wimpy to the downside.  Not only is it wimpy, we have a very nice example of histogram divergence here.  Divergence does not necessarily point to reversal, but it does point to retracement.  We seem to be having trouble with the 1.5543 area which of course is lining up with the weekly 21.  Stochastics is at the bottom of the trade zone.  This will be the first indicator on the 4 hour chart we will see turn if we are going to enter a retracement.  1.5716 is the 38.2% retracement level for the recent move down.  If we retrace, between that area and 1.5770 would be an area that would make sense to send price back down again.  The Bollinger bands are tightening on this timeframe as well.

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On the 1 hour the 21 EMA is in control of the move down currently.  If we are going to retrace here, that level will have to be broken.  Stochastics and MACD are still pointed down at this point, so I will be watching for them to turn to the upside possibly.  Bollinger bands are looking tight here as well.

My overall bias here is still short.  However, I expect a retracement at some point.  Divergence is easy to see, but figuring out exactly WHEN a retracement will come is another thing.  The best I can do is line it up with an area that is showing support or resistance and simply do what my indicators tell me.  Besides, if we are short, we want to sell high right?  What do we need to sell high?  A retracement!  This is exactly what I want.

Have a great weekend everyone!

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Non-Farm Payrolls Tomorrow

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http://fxbootcamp.fxstreet.com/2008/07/trade-nfp-liv-1.html

Well folks, today was a roller coaster wasn't it?  We basically ended the day right where we started.  More consolidation, we are caught between some big moves two days ago and the news events tomorrow.

Tomorrow is Non-Farm Payrolls for the US.  This kills any technical bias that I could possibly have.  I am not going to sit here and tell you which way I think the market is going to move when I honestly do not know.  Many of the smarter traders will be playing golf, flying a kite, or maybe even doing arts and crafts tomorrow.  They wont likely be trading the most volatile news event of them all.  But.......

IF YOU MUST trade this, I will give you some advice - Don't expect anything in the London session, it will either be flat or choppy in anticipation of this event.  Or trade it on a demo account with a competent coach.  Above I have added a link to a site on FXStreet.com where you can register to trade Non-Farm Payrolls with Wayne McDonnel.  This is a free live trading session that he offers at every NFP event.  If you like what you see, you might consider trying FX Bootcamp for yourself, it is where I learned most of what I know about trading (it's even where I got my indicators.)  There are only 500 seats available, so hurry up if you want to join.

I am not a salesman for FXBootcamp, nor do I receive any compensation for telling you about this.  It is just something that worked for me.  If you want to know more about it, shoot me an email and I will be glad to tell you all I know and how it helped my trading.

I will see all of you Monday!  Have a great weekend!

Below is a link to a video on youtube that talks about the last NFP event that Wayne hosted:
http://fxbootcamp.fxstreet.com/2008/07/trade-nfp-liv-1.html

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EUR/USD Daily Analysis

It was chop chop chop today.  No surprise there considering the down move we had yesterday and our arrival at the weekly 21 EMA.  Consolidation was definitely the name of the game for today.  Some of you may have been able to get in on some of these moves going one way or the other, but your expectation levels should have been considerably lower.  Sometimes the market offers 200 pips, sometimes it offers 15, you can not make it give up 200 when its only offering 15.…  I’ll repeat: YOU CANNOT MAKE IT GIVE UP 200 PIPS WHEN IT’S ONLY OFFERING 15.  It took me a while to understand that in my journey as a trader.  Don’t be out there trying to squeeze water from a rock folks, your hand will break before the rock.

In the way of economic announcements, we have some red on the calendar for tomorrow.  During London we will see the month on month nationwide HPI data for the pound coming out at 1:00 AM CST then German Unemployment at 2:55 AM for the Euro.  During the NY Session, Canada is releasing its GDP m/m at 7:30 AM CST, and the US is releasing Advance GDP for the quarter.  All of these numbers could possibly move the market.

I can sit here and type ten pages if you want me to, but generally I feel the same way I did yesterday.  Nothing has changed today to cause me to think bullishly about this pair.  We did not even touch a 38.2% retracement on ye sterdays move down.  That is pretty bearish to me. 

So my overall bias is still bearish.  Watch yourself though, I have seen the Forex do crazier things than a surprise reversal.  So once again, follow your own system, don’t blindly short.  Look for confirmation that we are going to continue down before making any trades.  Good luck.

Happy Pipping!

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EUR/USD Daily Analysis

Well, it was a very nice down day indeed wasn’t it?  It is definitely the way things were pointed yesterday.  I don’t think there was anyone out there really surprised by this drop at all.  If you were surprised, look over yesterdays post and review what was talked about.

http://www.youtube.com/watch?v=Y2iv_E-Fn9E

Tomorrow it appears that we will be light on London news.  New York will have the ADP Non-Farm Employment change for us at 7:15 AM CST.  Any surprising data here can certainly move the market but I would not really look for it to be a crystal ball into what Non-Farm Payrolls will hold on Friday.

Guess what we hit today folks?!?!  The Weekly 21 EMA that I have been talking about for about a week now, we have arrived.  Now the million dollar question is, “Can we break it?”  Well, the correct answer is, “I don’t know.”  We always assume that support and resistance will hold until it is proven broken.  But, lets break down what we have here.  We have a very clear top at the 1.6000 level that price just refused to break.  We have MACD in the negative and gaining angle and separation on the weekly chart.  We also have slight MACD divergence on the Weekly chart, and even slight divergence on a weekly chart is very important.  So I think if we are going to break the 21, this is the most likely time for us to do it.  

On analysis of the hourly chart, to day pretty much looks like a vertical red line.  What do we do now?  The right thing to do is wait for some type of retracement then confirmation of a continuation.  Blindly shorting here could get ugly if we have some serious sellers remorse.  However, with the power of this move down we had today, I would not be surprised if we don’t see a Class A retracement during the Asian session.  We may just see some sideways action or a very slight retracement with a continuation to the downside tomorrow.

My overall bias for tomorrow has to be short; BUT, with us at the weekly 21, I will be cautious.  We may see some ranging or chop trying to break a huge level like that so don’t be surprised.  Or we could just blast on down.  Whatever you do, wait for confirmation, follow your own system, never price chase and never break your own rules. 

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EUR/USD Daily Analysis

Sorry folks for the late post!

Here is a nice video from fxbootcamp.com on the EURUSD today:

http://www.youtube.com/watch?v=YxF1pfq2iSg

Tomorrow we have a little more on the table in the way of news.  The EUR will have German Prelim CPI data coming out for the month which is scheduled as an all day event on Forex factory.  The USD will have Consumer confidence at 9:00 AM CST, it is flagged in red so we could see some volatility if the numbers are surprising.

On the longer term analysis we are getting closer and closer to that 21 EMA on the weekly chart.  We are only about 181 pips away at the moment.  When price gets there I will certainly be interested to se what it will do.  We will either bounce or break the 21.  There may be some consolidation before or after, to include possible retest.  This is an important area.  On the weekly chart it looks more or less like we have completed a double top in the last couple of months so I would say that this could be our best chance of breaking that 21 that we have had in a while.  MACD is also facing down and looks like it is trying to gain angle and separation as well.

The daily chart is starting to gain more angle and separation on the MACD at this point which reinforces a possible break of the 21 on the weekly.  The 21 on the Daily chart has been broken and retested today without breaking back through it.  Tomorrow will tell us whether or not we can expect more downside or a break back above the daily 21.

We are also hanging around between the 50% and 38.2% Fibonacci of the last move down.  After today’s movement up we are certainly not in any kind of uptrend here, don’t forget that.  

On an hourly chart we now have official MACD histogram divergence pointing to the downside.  Looks like a lot of things piling up on us that suggest future down movement ladies and gentlemen.  And to add to that, take a glance at a weekly pivot point chart.  Sure looks like a bounce off of the weekly central pivot point to me.

My overall bias on this pair is short.  Now don’t forget, anything can and will happen in Forex.  Do your own analysis and wait for confirmation on your own system and analysis before placing any trades.  Do not blindly short here.   Most of all, have fun!

Happy Pipping!

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EUR/USD Daily analysis, Back online!

Analysis Current as of 3:55 PM CST

Current Price 1.5679

I apologize everyone, by the time I finally got a good internet connection last night it was pretty late.  Thank you all for your patience.  I’m back online for today and ready to rock and roll.

First off, lets go to the calendar.  We have GBP Prelim GDP for last quarter coming out at 3:30 AM CST tomorrow which could certainly move the market during the London session.    During the New York session, Core durable goods orders could rock the boat at 7:30 AM CST.  Revised University of Michigan Consumer Sentiment comes out at 8:55 and New Home Sales at 9:00 AM.  Be careful around all of these events, they all have the potential to move the EURUSD.

We are inching closer and closer to that 1.5510 level that I have been talking about.  It is the 21 EMA on the weekly chart.  It is important because price has been unable to break it since October of last year.  On the daily chart MACD has turned down and this could be an early hint that the 21/55 will cross too.  Price is below both EMAs and heading towards the 200.  The 21/55 has already crossed on the 4 hour chart with MACD heading down with excellent angle and separation.

MACD has turned up on the hourly chart but the 21/55 is still wide open down.  One of the main things that I am currently watching for is20that 1 hour MACD direction.  I would really like it to turn down for a trade on the hourly chart, which it may very well do.  Many times I have seen MACD act this way in the middle of a move down while the 21/55 is still wide open down.  All I see here is hesitation, I do not see any type of reversal back to the upside.

We have bounced off of a pretty important area of static support at 1.5632.  Which has offered significant support or resistance in the past so I am not surprised at all to see some upside movement here.  The question will be, is it just temporary respect that’s going to be a retracement or is it going to be a reversal.  In my opinion, looking at the time of day that we have started the move up, it smells of an Asian fade to me.  There is a good chance that we will move up for a retracement and then start a continuation during the London session tomorrow.  

If we are going to talk about fundamentals and market correlation, oil would be the biggest thing that I would be watching.  It seems to be on a significant downturn.  Of course this may be just a retracement, but every dollar you see oil drop, you can expect more US. Dollar strength.  

My overall bias for this pair remains bearish.  Of course the area we are at now could offer some support, but I wont really believe it until I start to see a lot more upside than we have seen so far.  If we continue up in the London session I would start to think long as long as my indicators line up in that direction.  

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No post today

Sorry everyone, My satellite internet connection is giving me problems.  I have finally just been able to get this email out in between the stormy weather.  I do know that today was a big down day.  We did break through the 78.6% retracement so we are now officially in a reversal of the last move down ::correction::  The move UP .  Watch out for retracements during the Asian fade and news releases in the morning.

If I get a better connection I will relogin and update the post again. 

Happy Pipping!

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EUR/USD Daily Analysis

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EUR/USD Daily Analysis

Tomorrow during the London session we have the Governor King from the Bank of England speaking at 3:45 AM CST.    Then we have Core Retail sales for the Loonie.

Economic announcements provided by www.forexfactory.com

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 Today we finally broke out of our range that we had been in for the past few days to the upside, this also could have been looked at as a triangle breakout; however price broke out twice.  So if you took that first breakout, you might not have been so happy with it, depending on how many pips you were going for.

Now price looks like its starting to create a series of higher highs and lower lows.  We have also reached our R2 reversal pivot point for the day so I will be on the watch for a nice Asian fade and continuation in the morning.

Every single indicator I have on my hourly chart is screaming up at this point, which usually means we will have some sort of retracement.  The 21/55 crossed up this morning, as well as the 5/8.  MACD and Stochastics are already pointed up as well with stochastics in the overbought territory (keep in mind that they will lock up in that area on really strong moves sometimes.)

Also interestingly, we stopped very close today to the 50% retracement of the last major move down.  If we can move higher tomorrow, we will move closer to voiding those fibs all together.  There is still the possibility of bouncing right at that level as well.  

We are also nearing the top of the channel line I have drawn at around 1.5937.  That should be at least a significant area of contention for price.  It may hesitate, it may bounce then retest and break.  Or it could even respect it and head back down, just watch out for that area on any type of continuation tomorrow.

We are now seeing a good amount of control from the daily 21 at  1.5821.  Its nice to see some sort of EMA control on a timeframe lower than the weekly chart again.  I am personally tired of braiding and ready to see a move.  The market does not care what anyone thinks though, it will move when it moves.  Just be ready for it.

My overall bias for tomorrow is up.  We will most likely see a retracement before that time comes though.  Watch out for the levels that I discussed, and keep in mind that we are at the 50% of the main move down, so get some type of short term confirmation before going long.

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SHOW-ME EUR/USD

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