$ £ € ¥
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 Sunday the 12th to Monday the 13th of December and the week.
ALERT: WE ARE (STILL) ON A DOLLAR SELL-OFF ALERT.
The swing trade for today’s Asian-London-U.S. session is to BUY the EUR/USD in the 1.3165 area with a STOP @ 1.3140 for TARGET’s of 1.3250 and 1.3300 for 85 to 135 PIPS!!! The EUR exhibited a classic ABC wash and rinse to 1.3165 key level and retraced back to the 1.325 area and back and so looks to repeat, again, no guarantee but decent probability given the set-up and the session’s key reports (notable US consumer sentiment given below).
Please watch the USDX and read below when taking this trade!!!
WEEK AHEAD: The USDX has carved out a very choppy wedge only to be violated in the next session in an ABC advance that has now completed and a falling wedge can be seen on the 4-hour chart. I have stated for weeks that the dollar was carving out a short term bottom; and projected an upside target of near 80, which is where we are pegged and now looking for the turn. The period of serious chop with the USDX oscillating between 79.9 and 80.3 for most of the Asian-London-U.S. Sessions the last three days looks to conclude with a look to the downside. The normally strong U.S. sentiment and employment numbers gave a brief bounce of strength in the US Dollar that quickly faded. This is a bearish sign for the U.S. Dollar but we must still be wary of further “Wash and Rinse” choppiness. Overall, this should still lend strength to all U.S. dollar denominated pairs if this is the real move that I have been expecting. A move of the USDX back above the 80.4 area will negate any short the Dollar trades as a fake-out move and more dollar strength should be expected (and the corresponding stop will be taken out in the AUD/USD and EUR/USD)... and then the following will still apply...”The dollar topped off at 81.48, which remains to be seen if it is bested or retested. Going forward, the dollar has room to move higher here, but prices need to follow through higher, and two possibilities still now exist. The first being the underside neckline test which is where the USDX is now poised to bump into the 81 area with further wash and rinse (chop) and would need to see some confirmation of topping action to confirm with the 82.5 area being the limit of upside if this case is to be valid. The second is if the 82.5 area is exceeded then a larger consolidation pattern (a triangle wedge) would be in play with the 86 region as the target. This month should tell us where we will go. We may have to endure some serious price swings to see which plays out first.” The daily close-up shows once again how important the 200-day moving average (DMA) is in flagging the next major direction for the dollar as seen in the USD daily and weekly chart here http://www.stockcharts.com/charts/gallery.html?$USD. The EUR pairs were expected to be overall weaker than the corresponding correlated GBP pairs however there still appears to be rotation of relative strength between the two currencies from day to day. Overall, economic data continues to be abysmal from a strong dollar currency standpoint but given EUR problems of late, it is a case of pick your poison.
For the EUR/USD a retest of the 1.340 level has occurred and the market has since backed away. Holding above the 1.330 – 1.334 area leaves possible retests of 1.340 open over the short term. The 1.325 area is the level that needs to give way on the downside for markets to test last week's lows (happening now) and the EUR/USD is seriously testing that area with the aforementioned chop. At this moment in time it is hard to say which way the currency will be pumped but the declining red channel from the highs needs to be respected and that is where we still are at currently. We are in no position to get ahead of the trade and state a turn in direction at this point although I am leaning to the BUY bias. We are 250-300 PIPS off of the lows from a 1200+ point decline. I am not casting this in concrete but just simply giving my unbiased take on it. An argument can be made that the EUR is a bit overvalued and think that GBP is more attractive currency. This decline could just as easily retest here at the 200-day moving average as the EUR moves higher to test the underside of the 50-day moving average at 1.37 now that another pullback to 1.32 area has happened. The key 1.442, 1.495 and 1.600 areas are expected to be seen longer term (should Ireland, Portugal and Spain hold it together). The EUR chart seen here, http://www.stockcharts.com/charts/gallery.html?$XEU, shows that these areas are now on a sell signal but is close to new PPO daily BUY signal after 38.2% retrace level has been tested. Place your trades accordingly. All charts courtesy of www.stockcharts.com.
Recent sterling strength has given way to weakness on Dollar strength. The GBP is still in bullish alignment with the 200-day moving average and a bounce has started and a PPO daily BUY signal is expected soon as seen here, http://www.stockcharts.com/charts/gallery.html?$XBP, and traders should be ready to jump on if it moves.
For the JPY intervention look to have been put on the back-burner as recent Dollar strength has mitigated the need for such action and any trades taken on the JPY would be as a buyer so as not to inadvertently fight the Bank of Japan. Be wary of the wash and rinse instead of a fast move in either direction that would normally be expected before the turns but looks to be rolling over longer term. Traders should continue to use caution should the JPY pairs be traded for the time being as seen on the chart given here http://www.stockcharts.com/charts/gallery.html?$XJY.
On the commodity currency front, the Aussie looked on the verge of collapse but then reversed the reversal and looked like it wanted to make a head and shoulder top on the daily but was invalid ... this is the currency to watch. Like the EUR, heavy, choppy consolidation, could be over as the range is broken, most likely to the upside. The AUD is seen here, http://www.stockcharts.com/charts/gallery.html?$XAD.
This week is filled with an even mix of data reports and policy/rate decisions. They are:
1. Mon. Dec. 13, 2010 - (4:30am EST) UK PPI Input.
2. Tues. Dec. 14, 2010 - (4:30am EST) UK CPI; (8:30am EST) US PPI and Retail Sales and (2:15pm EST) US Fed Funds Rate Decision and Statement .
3. Weds. Dec. 15, 2010 - (4:30am EST) UK Claimant Count Change and (8:30am EST) US CPI.
4. Thurs. Dec. 16, 2010 - (3:30am EST) CHF SNB Libor Rate(3:00 - 4:00am EST) EU Manufacturing PMI Reports, UK MPC Speaks; (4:30am EST) UK Retail Sales; (8:30am EST) US Unemployment Claims; and (10:00am EST) US Philly Fed Manufacturing Index.
5. Fri. Dec. 17, 2010 - (4:00am EST) EU German Ifo Business Climate.
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 assessing and exploiting PIP opportunities as they arise.
Enjoy trading and good luck everyone!
Trade with Mr. GREEN for $49$ for a 1 week trial. Don’t miss out on more PIPS!!!
For those who join with this special, the service costs only $179$/month after the trial expires, unless you cancel the membership. Trades are issued in real time, including exact entries, exits and detailed explanations. The service costs $179 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 information posted here or on this website.
No comments:
Post a Comment