Carrying on from previous posts concerning the USDX and €$
we now have price touching the RL. This should tell us if price is going to now fall away down Southwards or if we are going to see a first attempt to break up out through the UMLP. RL behavior often produces a retouch as price falls through the RL and then comes back to touch the line before continuing on the direction it came from. One question that has always puzzled me is why with some RL's price appears to pass through the line but then reacts correctly on the opposite side of the r-line and rises/falls (as the case may be with either a supporting/upsloping RL or resisting/down sloping RL) but the wrong side of the line? For this reason it is not yet definite as to the effect of this RL on price, but i can say is that there is categorically an effect. When you add the whole picture together ( ie levels €$ @1.40, £$@1.60 etc), it seems highly probable that this could be a turning/reversal point but only a fool would enter a long $ position based on the above alone. A break up through the UMLP above .7820 with nice long bars with good separation and provided we have seen price RT (to maybe .382 and also hold above the pink CL -after an initial attempt and failure to breach the blue mod Schiff UMLP ) then i would look for a pattern/indicator based long entry. Incidentally the blue mod Schiff fork runs parallel to the downsloping daily RL that has restrained price since the 9th September at P2 of that particular fork .
Tuesday, 12 October 2010
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Fantastic blog!
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