Double crossed!

TGIF folks!!

E$ price action unfolded as forecast and the following technical signals have reinforced the bullish scenario:
1. Bullish piercing candlestick - a reversal signal
2. E$ closed high enough for an open today to be above upper trend line
3. There are a couple more signals but since market has already taken off, let's stay focus on the profit taking part which is more crucial.

By the way, as I am typing, the last known stop at 1.2930/40 has just been cleared.

Taking the recent high of 1.31718 and yesterday's low of 1.2828, the fibonacci retracement ratio are as follow:
61.8% - 1.3040
50.0% - 1.3000
38.2% - 1.2960
One should mark down around 10 pips as a guide for profit-taking basing on the above 3 levels unless you are seated right infront of the screen to monitor the price action. Another level to watch is 1.2975 and 1.3100 (news induced). In the next couple of weeks, we may be stucked within 1.2828 to 1.3100 as E$ consolidates further.

Trailing stop should be moved to 1.2880 and adjusted accordingly through the day.

All the best and have a great weekend ahead!!

E$ Daily chart - The signals

Though still trapped, but....

Good afternoon folks!!

After spending almost 8 daily sessions of unwinding from the overbought condition, E$ has probably found a base after flushing out a bunch of sell stops to 1.2835 low overnight. It looked precarious when it was near the support trend line yesterday as momentum was all pointing down. 1.2800/20 ("Caught in between...", 26 Sep Wed) is crucial, as it is a pivot level and breaking and closing below could end all hopes for any meaningful rebound. I must admit that I felt uncomfortable because I still have the conviction to buy the E$ on dips for 1.3000 by this week. All I needed was for E$ to hold that line in the sand for several hours and the probability of a rebound would have increased significantly. A couple of technical signals kept my hope alive. They are the bullish divergence in the intraday momentum and the bullish cross between the MA21 & MA200 and MA50 & MA100 on the daily chart. The following economic data should trigger a whipsaw market allowing for opportunity to buy the dip; German Unemployment Change (1555hr Sin/HK), Eurozone Retail PMI (1610hr) and finally US Durable Goods + GDP (2030hr).

Stop loss orders can be found at 1.2780, 1.2800, 1.2825 & 1.2930/40 and large limit order at 1.2835.

Technically, intraday indicator is at o/b level as a result of the overnight rebound. Momentum has also reversed from down to consolidation with scope for a move higher. Lower TL support is at around 1.2840/50 and upper TL at 1.2925/30 (see chart below).
From here, I expect a possible sell-off from around current level of 1.2890 on the back of the european data and then market rebound off 1.2840/50 and test 1.2925/30 during the NY session. I will look to buy dip with risk to 1.2790 or 1.2760 for a break to 1.3000 by Friday.

All the best!!

E$ Daily chart - Supported on lower trend line 

Caught in between....

Good morning folks!

I must admit it is getting boring now as the range tightens to 1.2890 - 1.2950 today (see chart). Yesterday, market talk has it that there was gamma interest on either side of 1.2900 with expiry rolling off at NY cut. However, from the looks of things, it seemed like it may not have expired yet. Frankly, its getting really tough now and getting in the market is more like betting in the casino.

Order book is as follows with stops at 1.2810/00, 1.2870 & 1.2888/90 and large limit orders at 1.2850/55 & 1.2880/85.

Technically, intraday indicator is at o/s level though not extreme. Momentum is flat with a slight hint of turning up coupled with mild sign of bullish divergence. Daily o/b condition continues to unwind as E$ closed lower on a day to day basis and weekly momentum is still pointing down. If someone point a gun at my head now, I would place a 55/45 chance to go long E$ to retest 1.3000 today. However, I prefer to wait out for clearer signals before reacting.

All the best, commandos!

Update1: E$ is heading towards the critical 1.2800/20 support and momentum still seem to be pointing down for now (current 1.2840). A break and close below that level would expose E$ to a possible test of the 1.24/25 region. No recommendations for now. Update will be delayed tomorrow.

E$ 4hourly chart - Awaiting to break out

Time up!

Good morning folks!!

Indeed the only motivation yesterday was to seek out the stops at 1.2920 and 1.2900. But E$ managed to hold 1.2891 despite rumours of stop loss orders in the 1.2880/85 region. Heard there was reserve money interest and E$ bounce off to close the day at 1.2930.

Since there isn't much to report on, I shall share with all my longer term view of how I see the E$. E$'s daily indicator which was in the o/b zone is starting to unwind following these recent days consolidation and I expect this to continue for another couple of weeks within 1.2800 - 1.3170. I do not have any technical indications of an end to the E$'s bull trend. Instead, I see a healthy consolidation after the recent parabolic rally for the next phase of the bull run to tackle the tough resistance band of 1.3400-1.3500. The long term dilution in the value of USD through QEternity is far reaching and I am not surprised to see E$ heading towards 1.4000 in the months ahead.

Order book is quite empty. The only ones are 1.2880/85 for stop and large limit buy at 1.2850/55.

Technically, intraday indicator has gone into o/s levels and market should continue to unwind that condition. There are also signs of bullish divergence and this will re-enforce my view of buying the dip yesterday. Momentum is also starting to turn from consolidation to up. No change in the expected range, 1.2890/910 to 1.3040.

All the best and tomorrow's update will be delayed. Cheers!

E$ 8Hourly chart - Staying above

Stop seeking!

Goood Monday morning folks!! What a weekend!!! Hamilton looked set to win the Singapore F1 GP but his car failed him only to hand the trophy over to Vettel who drove a flawless race. On golf, when everyone was betting between Rory or Tiger to win the FedEx Cup, Brandt came from behind to walk away with the US$11mil paycheck!

Back to the market on Friday, E$ was rejected around the 50% Fibonacci ratio mark after printing a high of 1.3048 amid a very volatile environment, all due to poor liquidity. Focus remains fixed on Spain but the Troika will take a week break from negotiation and that should switch its mode to range consolidation for now with market seeking out stop loss orders in the process. Only potential mover to look forward to is the German Ifo business climate data at 1600hrs (Sin/HK).

Latest update of stop orders:1.2900 & 1.2920 and large limit orders are heard to reside at 1.2850/55, 1.2920, 1.3045/50, 1.3075/85 & 1.3100.

Technically, intraday indicator is in o/s levels though not extreme. Intraday momentum is suggesting range consolidation. Today's opening below 1.3000 should put E$ under initial pressure to test the 1.2900/20 support level and this is reinforced by the inside week bar from last week against the week before last (see chart). If that support band holds, we should see E$ gets suck back into the range.
For today, I expect range to be contained between 1.2890/1.2910 to 1.3040 (1.3100 news induced). I prefer to buy on dips with risk to 1.2840. Always remember to use trailing stops to protect your gains.

All the best and have a great week ahead.

E$ Weekly chart - Retesting trend line?

Have we found the base?

TGIF friends!!!! Singapore F1 GP weekend starts today, that's why I woke up at 5.30am to prepare this blog and hopefully make my budget for today before I head out  :)

Market flushed out most of the weak longs on this sell-off and touched a low of 1.2919. Bullish divergence has emerged and this signals a potential near term base and expect E$ to rebound into the defined range of 1.2910/20 to 1.3160/70 for now. I may have wasted an opportunity to go long the E$ the day before yesterday but the sell signal was consistently reliable and in the end was well rewarded. Admittedly, targeting E$ to hit 1.28ish was an extreme call to mentally prepare myself in the event of an overwhelming piece of news. Nonetheless, I am still very happy with my trade.

From yesterday's book, the only stop left can be found at 1.3060. Large limit orders were heard to reside at 1.2855/60 and 1.3020/30.

Technically, intraday indicator is close to o/s levels. With E$ hovering around the lower band of yesterday's range and with momentum turning from down to consolidation, it offers E$ some room towards the upside. E$'s ability to close at 1.2968 yesterday is a positive signal and this should provide some kind of support for at least the first half of the trading session.
For today, I believe the E$ should retrace this week's losses targeting the Fibonacci ratio levels, particularly the 61.8% mark. Risk should be contained to yesterday's low.

All the best and have a great weekend ahead.... one thing for sure, I know I will!!  :)

E$ Hourly chart - Fibonacci Retracement Ratio

For solid footing....

Good morning folks, one more day to the Singapore F1!!!

Indeed, E$ came off to the support level at 1.2990/1.3010 and it subsequently rebounded to a high of 1.3076. My recommendation to buy dip was called off because a conflicting bear technical signal emerged and I am willing to forego an opportunity than to make an exception and in the process create confusion in my calls in the future. Though E$ bounced off the low of 1.2993 during the early NY session, it has not re-captured the pivot at 1.3085 where it could have opened its door for the recent high to be retested.

Order book is getting busy again and stop loss orders were residing at 1.2970/80, 1.3085, 1.3115/25 & 1.3180. Large limit orders were reported at 1.2930/35, 1.2980, 1.3165/75 & 1.3200.

Technically, E$ closed a 'doji' yesterday and it indicates that market is uncertain and took a neutral stance closing at or near its opening price. Intraday overbought/oversold indicator is neither in extreme zone though the daily and weekly ones are in o/b level. Momentum is starting to point to consolidation > down. As I have mentioned in 'Comfort zone' (19 Sep Wed), I expect further consolidation before its next wave higher. But with the latest signal, it has increased the probability of a deeper correction into 1.2770/1.2800 before it resumes its next bull target of 1.34/35.
For today, I prefer to be on the short side with risk to 1.3090 and looking at 2 levels for profit-taking, 1.2970/80 and 1.2850 (looks abit far tho :))

All the best!

E$ 8hourly chart - Recent price action too steep