GreenForexTrading.com
ForeX forX-tra Gr��n
Hi everyone,
In this e-mail I am going to give you my review for the month past
and view on the market for the month of March, the week ahead and
today, Monday the 1st of March 2010.
REVIEW:
The highlight of February was the completion of the first Monster
Trade of the year.
Sent in the Monthly Outlook Newsletter on Feb. 1, 2010
"The 'Monster' trades. Thats right, there is now more than one!
While the GBP/JPY was stopped out last week, and the expected move
back in the 145-150 range was brief (enough to take out stops) it
still managed to travel � way into the range @ 147.2 and promptly
resumed its slide, further confirmed by the closely correlated
EUR/JPY pair. This weakness must be sold on any residual strength as
I no longer expect a reversal to the upside, but HARD STOPS ARE
REQUIRED, just in case. I recommend scale in SELLS (0.1 contract at a
time) on strength in the GBP/JPY in the 144.0 to 144.75 range with
looser stops than usual, around 146.2 (so explains the very small
position size) and/or scaled in SELLS on strength in the EUR/JPY in
the 126.0 to 127.0 range and/or, or better with looser stops than
usual, around 128.0. NOTE: All position trade stops are HARD stops,
NOT mental stops. Remember, hard stops for overnight positions,
mental stops for day trades. "
Sent in the Weekly Outlook Newsletter on Feb. 8, 2010
"As I write this many pairs collapsed over the week as much as
400-500 pips!!! For those sitting in the Monster Trades you should
be very happy as the EUR/JPY is now in the 122 range from our
recommended 126 to 127 SELL&thats some 400+ pips in one week!! Not
to be out done the GBP/JPY monster trade collapsed almost 500 pips
from our recommended 144-145 range to a current print of 139-140.0 in
the same time frame!!! We recommend that you take some profits if you
took this recommendation."
The month of February continued January with volatility to start off
giving well defined set-ups for some nice trades but gave way to the
choppiness associated with markets either preparing for a turn or to
continue the previous trend after a pause to refresh. This made
trading for many very difficult as we recognizing this state of the
market with scaled back positions and relied more on marginal scalp
trades to increase our overall PIP count. Those days appear to be
over.
MONTH OF MARCH:
The emphasis will be on the USD and to a lesser extent the EUR. What
was written earlier in February, still applies &some fundamental
shifts in sentiment expected to play out over the next few days if
not weeks. The sentiment on the Euro is nothing short of apocalyptic
will all the bullish dollar players expecting the happy days to
continue till nirvana. Seems everyone forgot the complete bearishness
in the dollar no more than 2-3 months ago when the dollar was expected
to be in the dustbin and aside from precious metals the EU was the
only play in town. It is these extremes in sentiment that we meager
souls at GFXtrading hope to exploit with laser-like precision as half
the battle is recognizing the type of market we are in. Well that
shift is now upon us as several more pieces have come together to
yield some exciting PIPS moving forward. Also stated earlier... As
explained in the Trading Room, we were waiting to see what
fabrication would come out of the U.S. CPI report and we were not
disappointed with an unbelievable -0.1%. That was 9 days and some
200 choppy pips ago. Choppy trade has given away to what appears the
start of trend reversal and a close on the USDX below 79.5 on a
weekly basis will confirm that projected reversal as seen on the
daily and weekly chart which can be seen here&
http://www.stockcharts.com/charts/gallery.html?$USD
. The Euro also has indicated a reversal with bars indicating
reversals of extremes in sentiment and buy signal generated on some
indicators we follow as seen here&
http://stockcharts.com/charts/gallery.html?$XEU
. The pound on the other hand has yet to indicate a bottom in place
but is extended at key retracement and prior support levels as seen
here... http://stockcharts.com/charts/gallery.html?$XBP
.
It is our continuing belief that the 2-3 month dollar countertrend
rally is done. Another nail in the coffin of the dollar is last
weeks Commitment of Traders Reports showing more extreme positions
which are always a nice confirmation at major turning points. Note
that the commercials (the big boys who somehow always seem to get it
right) are heavily short the USD, increasing their net short position
the week prior (most likely while at the same time adding a lesser
amount of shorts to drive the market into) to a lopsided 7.5 to 1
(47,732 short vs. 6,337long). At the same time having the large specs
(wrong way Louis) run for the hills as they are heavily long the USD
and closed out more almost � of all remaining USD short positions to
stand at 5261 net short vs. 8146 the week prior; and with 43,653 net
longs are rather lopsided as given from last week ...I expect this
weeks report due out Tuesday will show a further decreased spec
short position while they stubbornly hold on... . Further
confirmation that a major turn is taking place is always appreciated
when the big boys COT results comply.
The Monster trades. Thats right, there is now more than one! The
AUD/USD trade was stopped out last week, and the expected move back
in the 0.8950 range was brief (enough to take out stops), it still
managed to travel � way into the 0.8900 to 0.900 range and promptly
resumed its advance, further confirmed by the closely correlated
NZD/USD pair. This strength must be bought on any residual weakness
as I no longer expect a reversal to the downside, but HARD STOPS ARE
REQUIRED, just in case. I recommend scaled in BUYS (0.1 contract at a
time) on weakness in the AUD/USD in the 0.8900 to 0.9000 range or
better with looser stops than usual, around 0.8800 to 0.8850 (so
explains the very small position size), and/or scaled in BUYS on
weakness in the NZD/USD in the 0.6850 to 0.7000 range or better with
looser stops than usual, around 0.6800. Note: the AUD/USD is the
preferred pair with ultimate targets expected to yield 1000 to 1500
PIPS over the next 2-3 months, maybe even sooner. Again, NOTE: All
position trade stops are HARD stops, NOT mental stops. Remember, hard
stops for overnight positions, mental stops for day trades.
Why the Monster Trade ?
From last weeks Weekly Outlook&.
&the dollar...having completed a classic ABC correction in a long
term down trend. As for the GBP and EUR, I am hesitant to call a
bottom here as extremes can always get more extreme, and in some
pairs, one more leg down is not off the table; and since the bounce
that failed last week in dramatic fashion&Be forewarned, a tradable
bounce is near and the set-up for a mini-monster trade could soon be
in place... Well folks...that bounce is here and expected to continue
in the EUR, GBP, CHF and the commodity pairs, AUD, CAD and to a lesser
extent the NZD. The consolidative phases are being broken to the
upside in all dollar (USD) denominated pairs. The JPY will take a
back seat for now but is expected to follow the USD in a correlated
fashion.
WEEK AHEAD:
Many other pairs that looked to be on the verge of collapse, did
reverse from key hourly, daily and weekly support levels last week. I
have no forecasts for the week ahead as some residual choppiness
stands to be ever present but that by the end of the week all USD and
JPY denominated pairs in the EUR, GBP, CHF and the commodity pairs,
AUD, CAD and to a lesser extent the NZD should all be higher than
today. Many pairs are ripe for reversals after some of last weeks
moves and would look for that early in the week as an opportunity to
buy. Continuation moves can be risky unless a pullback occurs. This
week we will look to HEAVILY trade dollar weakness and retracements
intraday. With several reports to trade around, this week could give
a very profitable week indeed. Month end position squaring is over
and feel that the overall trend of dollar weakness will be hard to
fight. This also gives rise to the next Monster Trade. In this,
opportunities for more position trades along with a hopefully a new
trend play or two by the end of the week are forecast to be in order
in the Trading Room this week. Either way, it should be a volatile
week with opportunities that we hope to take advantage of in the
Trading Room as events become clearer. Again, there will be many
reports to move the markets this week combined with reaction moves
should mean greater volatility than most are used to in the Trading
Room the past few days<<< we always hope. That being said we still
will be aware of spike/gap volatility (chop & slop) and adjust
position size accordingly but will go in with both fists to play any
forecast breakout and/or trend plays.
* *
*FOR TODAY:*
* Todays swing trade is for the late Asian/early London Session, a
retracement trade in the EUR/JPY. *
* BUY EUR/JPY on any trade AT 121.15 with a STOP AT 120.95&TARGET =
122.05 (90 PIPS).*
That's it for today. Remember that I trade in the Live Forex Trading
Room between 1am-6am Eastern Time. I will be hosting my regular 3-4
hour session and some scalp trades could be on the menu. So there
should be a little more trending action and pips to be made.
Enjoy trading and good luck everyone!
Stay tuned for more up-dates. I am now running the FINAL DAY OFFER of
the Trading Room Special of $7 for 7 days!! Dont miss more PIPS at
bargain basement prices!
*Trade with Mr. GREEN for a **$7$/trial for 7 DAYS!!! FINAL DAY
OFFER.** *
*Trades are issued in real time, including exact entries, exits and
detailed explanations. The service costs $99 per month. So go to
GreenForexTrading.com now and take advantage of this offer.*
*Mr. Green*
*Risk Warning! *Trading foreign exchange on margin carries a high
level of risk, and may not be suitable for all investors. Past
performance is not indicative of future results. The high degree of
leverage can work against you as well as for you. Before deciding to
invest in foreign exchange you should carefully consider your
investment objectives, level of experience, and risk appetite. The
possibility exists that you could sustain a loss of some or all of
your initial investment and therefore you should not invest money
that you cannot afford to lose. You should be aware of all the risks
associated with foreign exchange trading, and seek advice from an
independent financial advisor if you have any doubts. All information
posted on this website is of our opinion and the opinion of our
visitors, and may not reflect current situations and occurrences.
Please, use your own good judgment and seek advice from a qualified
consultant, before believing and accepting and acting upon any
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