Sunday, 30 May 2010

Euro$....I missed this one..Ohhh dear!!!

Oh dear! I took my eye of the ball on Friday afternoon....I got caught up in the short term Euro rally and never stopped long enough to look at the bigger picture which was staring me in the face...multiple price failures (on multiple forks..see the red in the Metatrader chart and its the same in Ensign which i am not bothering to reproduce here as it's a single data feed) to reach the CL. You will be happy to know i paid the full price and although not a massive drop in the grand scheme of things & markets at approx 13:30 USA (East Coast) time 19:30 my time in France the fundamental news that Fitch had downgraded Spain sovereign debt by 'one notch' sent the market into free fall. My buy orders below the market were filled and stopped out at (obviously and not unreasonably) painfully below my order levels/limits.....Ouch! However sensible money management means that even this is a lesson i can smile about...just, and the week on balance still had huge potential re the $CHF trades BUT i now presume my thoughts of a Euro reversal are over and out the window and we will go lower if we take out the previous lows at 1.2150 area..perhaps considerably lower if this happens before price tries again on the upside..unless and it is a big unless we hold on the larger forks LMLP and rally towards the CL.I have seen stranger things happen. But the bottom line here is it doesn't look good as price has failed to get to the CL in just about every single ML that you can draw in the above TF's and higher.
Whenever i loose objectivity like this i go back to the E-signal daily/weekly/monthly charts and do a full 'work out' and try to find new potential support levels...Not of course for a trade entry but purely for possible potential future support either from ML's or RL's etc. Revised long term possibilties for the USD against the majors to be posted on this blog after i have studied the possibilities.

PS: Here's the detail on a 1 min chart ( the red lines are reaction lines not Median lines ) and it doesn't look much on a larger TF like 30 min but it was still an 80 basis point drop!

As with most weekends i provide something not related to technical trading so here is an old favourite from my generation

Wednesday, 26 May 2010

$CHF continued.....out of shorts and long on RL

Expect some volatility but i am long on this aqua blue RL and if we hold could see a decent rally to fill the mountain ....maybe upto the UMLP of the blue schiff ML set ( see earlier post)

$CHF continued.....It's a Schiff ML

Here is the fork that defined the recent swing high after the bounce late yesterday evening and overnight in Asia. Its a Schiff fork (in blue)but yesterday i used the same wave to make a Mod Schiff ML which also was pretty accurate. Price failed to get to the CL of the charcoal ML set ( which is the pre schiffed fork) so we should be going lower again. Incidentally below is the same set of RL's and warning lines i used yesterday in the downward sell off which still works and i refer to as the 'seed' fork and is now BC in the Schiff ML set. I have seen this before and was always amazed how long these lines continued to effect price action...I guess until we move into a new fork.

Tuesday, 25 May 2010

$CHF mapped with RL's

here's a update on 1 and 5 min charts showing some perfect price action. If only it was always this easy! Long for a expected small bounce for the $ until we see further weakness


perfect ML set with warning line and reaction lines in brick red

Friday, 21 May 2010

short on the RL

now we are through the two RL's and headed south by way of the turquoise LMLP

The result was a breakout to the downside and a profitable trade but the low was around 1.1450 not the 1.1400 i expected and then price was all over the place ending around 1.1525

A big day for $ Swiss......

This may look a mess BUT it shows all active ML's and more importantly reaction lines ( dark red/claret). I am bearish of the USD vs CHF after a recent rapid rise. Price action has petered out on the upside and we have a series of diminishing tops with lower lows but price has been stuck in a sideways range for the last few days. I believe we will see a rapid downward movement towards the 1.14 level. I have a trade sellstop entry based on a retouch on the most recent RL and used stochs/B-Line stochs and Macd to tune the entry. Here are the charts as of 5 mins ago

Wednesday, 19 May 2010

Gold ML price failure

carrying on form previous posts we now have the reaction line above and a price failure at the CL in the blue fork.

Short $CHF ..right here right now

The conventional Andrews ML is the larger of the two and the smaller is a schiff ML from the top of the long candle. $ looking very tired here and stochs lining up for a RT plus we have reg & hidden divergence and 'double tops' forming.

Tuesday, 18 May 2010

Outcome of both setups Gold & $Jpy..Successful

Both trades presented over the weekend were spot on.
Gold was full of pure reaction line trades as per my suggested short on the green UMLP which would have reaped a good profit but now we are in a slightly adjusted fork and the current short term green fork RL is carrying gold upwards along its axis.It's a bit distorted in the above chart but if get down to a low TF it's pure magic to watch. I would look to get short gold again on the UMLP nearer the long term RL.
The $ against the Yen was also a perfect price failure and the trigger line /Hagopian rule worked like a textbook trade even though it was late Sunday and at a very antisocial hour! Since then the $ has rallied and is looking very shaky near the long term UMLP and at the phyc level of 93.00 where i have resting short orders but more of that to come in later posts.

Sunday, 16 May 2010

Gold update

Please refer to yesterday's post first re $JPY
Further to my short post about Gold on Friday and the excellent 30$ fall we saw on Friday afternoon i will explain why i was short gold and why i think we may see further weakness this coming week. Firstly please look at the daily chart below with reaction lines inserted and then look at the 60 min chart to it's right. You can see the effect the RL is having on price and i have been watching golds recent relentless climb looking for a possible time and place for a sell off . After the last upward effort by price action when we barely made new highs (by one buck only!) we now have possible double tops/'pipe tops' (at least in 60 & 240 min TF's and it is possible they are valid as D-Top's on the daily chart as well). One thing is not in doubt and that is the effect of the RL.........

Now have a look at the 15 minute chart below showing Fridays price action and the red daily RL. It runs almost along the same axis as the green downsloping forks CL & the aqua blue CL. Add to this the fact that we are near to the red UMLP in the long term daily chart and another long term yellow UMLP. Reaction lines can be dangerous and price often 'pops' straight up through them and then starts using them as support to climb away upwards but we have already been above the RL when we formed the RHS double top but could not convincingly make new highs/higher highs and have fallen back and made a lower low and (to me) this indicates price weakness and a possible reversal.

Now in the last chart above(right hand side) i have added a recent fork & reaction lines and used alternative pivots and changed slightly the position of the daily overhead RL very slightly (below 30 mins Metatrader sometimes cannot show RL's) and 'Hey Presto' we see that Friday's low was the second reaction line in the down sloping green fork in the 15 min TF chart. From this i suspect that price will be carried higher to one of the UMLP's or the intersection of the two reaction lines. This maybe a lower high and possibly another short position but as yet i see no high probability entry but definitely worth watching. Should price zoom through the overhead reaction line then it usually returns for a retouch which can be seen in the daily chart on the previous RL. This would be an opportunity to get long if my so called possible retracement comes to nothing... so either way there could be a way into the market.

Saturday, 15 May 2010

$ ¥....Yet another very high probability setup

Last weekend i presented a extremely high probability $CHF trade setup with price failure/Hagopian's law being used and i said that you could just trade these highly reliable setups by searching major currency pairs and futures markets in all time frames* and running a highly profitable account. This weekend i present yet another superb trade entry/setup for Sunday evening/Monday morning.There is only one drawback which i will mention soon. Firstly i present my case. Firstly the general picture in long/medium term USDJPY.

The pink and light blue forks are mod Schiffed. The current green dominant ML set has two warning lines. Now here comes (below) a more recent picture of price action in lower TF's......

This (above) is USDJPY in 10 & 15 min. Here you can see the recent $ fall and concentrate on the two upsloping red and blue ML's. The second image i have added Bollinger bands and annotated the chart plus added the blue trigger line. You can see both price failures and the first re-touch on the bottom of the blue LMLP. Now price closed on Friday night on the red LMLP, which also happens to be the exact position of the blue trigger line. If you know your "Andrews" you will know why i am so excited/interested in this. This is a classic short entry and by the looks of it you could have a stop of 10 pts. There is one drawback.....The same drawback that screwed up last weekends $CHF similar setup...The Asian market opens a hour or two before before my Metatader platform starts trading 11 PM(Euro time) Sunday evening. On the E-signal chart you can see price petering out on Friday evening in the USA but on the Metatrader chart you can see price just stops bang on the LMLP and also at the trigger line and on the UMLP of the grey DS fork (deep red in MT). The Bollinger bands all look good in all TF's except in the 30 min charts and the Stochastic's are in a superb position on my B-line window with the 35-10-1 stochastic low down on the 'floor' and the 5-3-3 and 9-3-3 right on the 'crest of the wave'. My advice is to see the opening in Asia and if the line holds get short.

* I have found to my cost that price failures at the CL and retouches on the LMLP and trigger line trades do not seem to work at micro time frames such as 1 min, 2 min and 3 min and sometimes 5 mins. For some reason price action at this level is not reliable enough to trade these setups and i have found that the price failures do lead to a small fall but then instead of a retouch price can reverse upwards back into the fork and stay there often beware and stay safe in 10,15min time frames upwards.

Lastly, you could add a new ML set now that we have a new swing low. It makes little difference if price opens up on Sunday evening lower but if we see price rise through the closing /trigger line area (and making any short sale at the trigger line impossible) up to the confluence of the new green CL & pink LMLP and thin blue CL then i would again look for a short entry.
12:15 Sunday/Monday morning.... Let the gap close b4 any short position is taken

If you want more than this excellent trade then you must subscribe to my email notification service which notifies you of intra day trade setups of price failures and other ML high probability setups similar to the above as they occur.

Otherwise as with most weekends i try to provide some light entertainment away from the markets..Here are two great soul songs from the 70s
The Staple Singers
and another favourite

Friday, 14 May 2010

Gold..getting a bit over confident?

As i write we are seeing a nice little bounce up to the 38.2% Fib RT on gold after a nice sell-off. This has been a very busy week and especially today..hence my lack of posts and as i sit here with a full ashtray and a thumping headache from too much screen time, i am considering all the price action i have seen today. $ weakness against the J-yen, $ strength against the Swissy but overall i still cant get my head round the Euro and it's relentless fall. I suppose i should have had a bit of the short action over the last few weeks but i have not touched it with a 'barge pole'. The main reason being if i can't see an active fork and price action between the lines and the fork then i have no idea of price direction other than the general trend. In other words there is no way in to the market with a high probability trade setup...for me at least. I struggle with timing of all my trades and if you read most of the blog posts you will see that my analysis is more often than not right and i am rightly proud of being able to see the right 'map' of multiple ML's which i use in all time frames ..However, that means nothing because if you entry is ill timed then it doesn't matter which way the market is going you just get stopped out unless you are one of those people who has enough money to trade high TF's and use massive stops.I am not like that and timing is probably the most important discipline i need to work on. Not just impatience which is also a trade killer but the study of bar/candle price action is paramount and to spend 8-12 hrs a day infront of your screens does teach you about price structure and patterns. You know when you have entered a trade correctly because price rarely goes against you for any length of time and you are usually able to bring your stop to B/E very quickly.

Tuesday, 11 May 2010

USD CHF trades.. The result.

Well, you can see that my reasoning or moreover Andrews rule re price failure/trigger lines was absolutely spot-on. However i only traded the opening of the Sunday night Asian session and that was a long position filling the opening gap buying at 1.10 and selling at 1.1040. The problem was the expected fall came in the mid Asian session and i had to go to bed by 1am to get up at 6am to get my daughter to school, by the time i woke up at 6am it was all over and there was "another game in town". As i said in the weekend posts you could very easily search all major currency pairs/time frames for just these price failures and trade them as a high probability approach. The result is reliable. I am flat on $CHF but think yesterdays rally maybe becoming tired as we have had no decent RT. A simple Fib RT from points 1,2 & 3 (above) gives us a 0.382 RT to the red UMLP but it looks to me as though we will form another wave ( we also have a lower high -so far) so maybe price is at the top now plus both stochs and MACD show regular divergence as price made the recent high..but it is too soon to tell.

Sunday, 9 May 2010

Update on the $ CHF setup to follow.................

OK....the reason for the angry face is the market has (as i expected) opened up much lower but we may still get a retouch on the 1hr TF on the trigger line BUT my broker FX Pro & FXCM doesn't open for another 50 mins. More/update to come. I am also very worried about USD vs JPY which looks very week after Fridays massive there may be a large USD correction underway.
Here is the first two hours of the Asian session. The Euro has gapped up and i think we may see price fill the gap so there will be planty of time (hopefully) to go to bed and then get short in the London/Euro trading session tomorrow/Monday.

11:07 pm iam long Usd/CHF looking for a bounce back to to the trigger line area to close the gap where i expect to go short in the Euro/UK session.10pt stop.

And heres what i am worried about with US$ vs JPY... we have compromised the long term LMLP of the rally since late 2009 & have not reached the obvious doesn't bode well.
PS: The thin red fork is a reverse ML set re Andrews ( see the re-touch!)

Saturday, 8 May 2010

Your weekend treat plus a trade from heaven for Sunday night/ Monday morning

USD Swiss pair in 3min E-Signal Chart current uptill Fridays midnight European closing.

I have been trading USD/CHF (successfully i should add) the last few days since the original UMLP short trade on Wednesday and now i can share with you perhaps the perfect setup which devloped on Friday and could be a setup for Sunday night Monday morning provided certain criteria are met.

First of all follow the link for this Video/Music by The Verve and play.....and at the same time open the charts below and follow my commentary below the charts.

Firstly, it maybe a good idea to read my post of Mon March 22nd
But if you are impatient here are the basics in a bullet list:

1. (Since the recent high of 1.1246) Price is in a downtrend and down sloping ML set (RED) and has made a new SL (1.1014) taking out the 1.1040 level and consecutive lower S Highs. But remember the red ML set is within an upsloping green ML set so this is only a short term reversal but well overdue in my opinion and remember what has happened to the Euro and other USD based currency pairs recently so the US$ is overdue a correction even though i remain overall bullish.

2. The retracement is so far limited having been down to 40%( 1.1014)if we only count just the recent up move since March 3rd and price is now stuck between the Fibonacci .25% and 38.2% levels.

3.Using the last two swing lows (on a 10 min chart below) as P2 both cases price has failed to reach the centre line.

4. Price naturally want to gravitate towards the red centre line (and the UMLP has been tested twice with excellent results) and with our consecutively lower highs we are due for a new swing low.

5. Using Hagopians law we can wait and see if price comes to the trigger line of either of these two forks. Price has already fallen though the blue LMLP and closed late Friday just a whisker below the black LMLP. I closed all my positions late Friday due to recent gapping moves on the Sunday Asian opening and there is always a chance (remember the EU ministerial meeting to discuss the Euro ahead of the markets opening) that price could gap up & shoot up to the black CL which case all this is in vain...However, if we get to Monday European trading with price just around these levels and near the trigger lines then i would go short on a break of the lower(fat pink) trigger line.

6. If you go short on a break of the black LMLP ther is always a chance of a retest and the stop level may not give you a decent risk/reward ratio, so the trigger line approach is better and safer

7. What is my objective? Well a new swing low below 1.1014 is more than possible. The stop level

for a trade of the lower trigger line will be about 1.1270 ie, just over 10 pips and trade size will be two lots of 100k.

8. The actual trade entry will be timed using Ensigns B-line/Buffy template on a 3 and 5 and 10 min TF.

10. In summary i hope i have shown a possible high probability trade setup ahead of time. Of course i may look a complete fool on Monday morning or worse...i might have a losing trade but i can tell you that my success with these types of trades is high and you could run an effective account if you just concentrated on finding price failures in ML sets in multiple time frames and different major currency pairs.

Euro$ ...The prognosis looks like we have a new swing low

Here are two very simple studies on Euro$ monthly charts going way back. Simple forks/Median lines (the red forks are Mod Schiff...again using obvious pivots) which to me indicate that we may have our new swing low. I have included the grey ML set even though price has 'left the building' as it must be considered the most important historic recent fork as it has caputured the vast majority of price action if you include the 'handle' and price has now returned to the UMLP.
The two ML's in play seem to be the black upsloping( this is the most important as we already have several touches on the LMLP and two on the CL) and the red up/Sl Mod schiff. The other red Dn/Sl Mod Schiff is included as it describes perfectly last years swing high but as price has not reached the CL we are going higher provided we do not go down to 0.8000 !!. Price could drop through the black LMLP below the red CL but i consider this unlikely as have a look at the Bollinger Bands and Macd indicators and the market is already heavvily over extended to the downside...The divergence is also there on the weekly chart and on the daily chart even more from these two charts basic analysis concludes we could have reached the low on the euro.

Thursday, 6 May 2010

$ CHF closed position

Closed all shorts at this LMLP around the 1.1090 level

Short USD CHF...again!

12.46............update time for a bounce before the US comes in and we go lower? ( see Ensign ML & inds). I have taken profit/ 1 lot of 3

Short USD again....see the long term UMLP of several different and assorted Mod Schiff forks/ML's and price has currently retraced 23.6% Fib of the recent vertical move since the 1.0730 area on May 3rd. Postion taken at 8am London time (9am CET). Partial profits to be taken at 1.1085
Entry level enginered at the UMLP using multiple stochs and Bollinger bands on multiple low time frames and also a retouch of the UMLP(aqua blue)