€$ Back to test support/RL 1.3220 ?

Could be a busy day....Looks now highly probable we go down to test the Rl.
If we go sharply down it could test the aqua blue ML, now at 1.3190 which provided support yesterday.

1300 hrs (CET) €$

And an hour later ahead of the US opening ( 2pm now my time) have a look at the Ensign 120 min chart in more detail which i posted this morning. Also is the Dx through the RL? Looks like it...perhaps more pressure for the Euro this afternoon?
(original post was the bottom MT chart but i have added to save on number of individual postings)























Following on at 1300hrs

€$ & USDX

OK, Here we are Friday morning after the euro held the RL from yesterday. I was somewhat premature in announcing the breakthrough and 1.3180 was an insufficient penetration of the r-line. Price rallied late yesterday and overnight and we find ourselves at levels of 1.3350.
What is obvious is that price is still stuck in the range i mentioned during the course of this week.
The DX failed to take out the CL of the blue fork and has collapsed back but price action is still in play in the black up-sloping fork and we are on the LMLP now which is a .618 Fib RT and €$ is at various CL's and UMLP's at 1.3350. One of those forks is a pink D/S fork drawn from obvious pivots & i have been watching this fork recently. What maybe of concern (to those who think the USD will rise) is that there has been no CL touch on this fork. Price is currently falling away from the pink UMLP ( shown in MT chart) but this is common for a first attempt. I expect to see the $ strengthen this morning from these levels but by how much is difficult to say. If the DX breaks down through the black LMLP and €$ rallies up through 1.3350 then we will see another complete cycle of the orange horizontal fork in the DX chart and the level indicated in my Ensign chart would be a possible level to look for the top of this cycle- if of course we do no see a conclusive break out either way. Various EU meetings today re the future single currency bailout plans & US leading indicators for Nov ...i still can't see the USD in such a negative light as many & so I still favour the US$ and my outlook for a continued $ reversal but it is possible we are going to continue in this range until maybe after the Christmas/New Year period as volume declines and major players wind down their books and dealers think about the office party and family and a rest.

EURUSD

EURUSD

Perhaps a small bounce of the WL upto the RL at 45° or the weekly RL from earlier posts ?(shown horizontal in this chart)......then down.

€$...BINGO!

OK, As expected we go lower. We could now see a touch or kiss back on any of these reaction/warning/median lines but in particular i would suggest the RL from the earlier post.
That should be your opportunity to get short ( if not already short) so look for an trade entry setup. Now the DX should reach the CL arrowed in the E-Signal chart which i discussed this morning...the 80.80-81.50 level.

EURUSD

Still ranging ahead of a break out and currently on the LMLP of the blue fork.










And this chart below shows my old friend- the reaction line i mentioned in previous posts.

€$ & USDX

Carrying on from yesterday i am posting this chart clearly showing the long term reaction line i first posted last week when price made a three touches on this line and bounced- very sharply directly off this reaction line on monday. This RL originates from an obvious Andrews fork in the weekly TF ( P0 26/12/04 1.3667?, P113/07/08 1.6074? & P2 13/11/05 1.1634?) and as such exerts a more powerful influence over price action in my opinion. Also price has oscillated around this upsloping RL since it first encountered it in May this year and for all i know it maybe responsible for the Euro reversal which started in May.
We now find price back on this RL and when it goes down through it which i expect it will soon, the fall could be brutal and sharp. However before then we could easily make one or more mountain/hill cycles upwards and back down. Remember the DX is stuck in a similar pattern ranging between good support at 79.00 and resistance at 80.80
So how sure am i that the DX will break through 80.75/81.00 and the €uro will fall below the 1.3200 level?
I am as sure as i have ever been and have presented a serious case for US$ reversal since early Sept BUT as with all markets i would not preempt price action but would consider a short Euro pos if we saw price rally for another 'loop' before it comes back to test this RL again. We have retraced 100% of this weeks rally and this is about the 5th serious attempt at penetrating this RL. If price action keeps coming back to test this RL (and also failed spectacularly at breaching 1.3500 on the upside) then the market is telling us something. Add to this the mauve/magenta CL failure in the daily €$ chart and then look at the fundamentals which are simply shocking.......conclusion? Lower Euro and a DX break above 81.50.

A great example of reaction lines at work.

€$ & USDX...What's going on?

OK, here are a mixed bag of charts of the USDX and Euro vs U$. It appears that the recent high just under 1.3500 was a touch on a centre line shown in the simple E-Signal chart as a black DS fork. I confess i was taken aback by the energy we saw in Mondays € rally and have not seen that sort of energy since before we peaked at 1.4280. But if you look at the E-Signal EURUSD chart you will see that price must make it to the magenta pink CL to remain in the 'game' and between the magenta pink CL and the current price lies the RL that runs right through the daily chart and caused the original resistance and failure & fall at 1.4280.
I feared several times over the last weeks that i had misjudged the USD and that maybe we are seeing a simple A-B-C correction in the USDX before a continuing descent.
I still hold fast on my 4+ month appraisal on the USDX reversal & that it will soon take out the 81.00 level but after nearly 3 goes it has retreated but so far we have seen good support at 79.00. The DX now battles with the downward sloping RL. However a third bash at 79.00 would have me running for the doors and i suspect we would send us significantly lower. 79.00 represent a .382 Fib RT from the 4th Nov low at 75.76 which is nice n shallow for continued upward movement. We seem to be stuck in a bit of a range 79.20-80.80 on the DX and good support on €$ under 1.3200...However even if we see €$ upto 1.3500 it still remains vunerable and the Eurozone fundamentals are simply shocking especially in the light of ever increasing positive data out of the US.
The bottom line is that i am flat and out of both these markets and will sit on my hands and watch price until i can see a more clearly defined trend.







































Laslty EURGBP following on from yesterday.....looking a bit over-stretched? I am not sure but there is a really nice bullish pattern in the 240 min chart with a wide double bottom (p0 & p2 in yesterdays chart) and we have seen a nice strong trend up from the .8350 area.

EURUSD

Simple- if you are using the right pivots?
(All ML's/WL's drawn automatically by custom indicator)







The previous chart in 5min TF

Important €$ chart

Here is a simple multiple fork 60 min chart of €$.
Notice that only one RL is drawn( extended beyond the LMLP). It comes from the most basic U-S fork that can be drawn in this years rally from the low below 1.20 as P0 to the next pivots P3 & p4. This fork has one RL drawn. It is shown here in E-Signal as red brown line.
Here is a relevant link
If price fails to get above 1.3500 and thus to the pink CL then we are surely at the top of the current Euro cycle. If not and over the next few days a different scenario pans out then i suggest we may see Euro$ up to the high 1.30's ( 1.37?)and it could mean that the $ will weaken. I still however favour the USD.


Possible trade set up ( below)5.14 Central Euro Time
Watch for a break either up or down ( below two views of the same scenario with different ML's & RL's) Normally - but not always- breakout occurs in direction from which market came from-in this case down. Yesterday there was an identical opportunity as the Euro went up.

EURGBP & €$

We could have a spectacular CL failure here in EurGbp. I have shown forks off all the major pivots and you can see each one delineates a seperate SH or SL. The Mod Schiff is in light blue. It does not matter if price reaches all of these. If it does not reach the Andrews fork then a reverse is highly probable. To add the reaction lines would move you one step closer to a trade plan/setup/ entry (but i have not had the time). One reason i have posted this is because there is absolutely no doubt or confusion over the ultimate P0 pivot. Below a simple fork with RL in €$ and some further low Tf charts showing the support we need to break through to go lower. Also in the DX ( see previous post & the DX H1 MT chart.Price has rallied up and hot the underside of the yellow RL. at 79.85

USDX & €$...cont

Carrying on from this morning
Spot the difference between the location of the reaction lines in these two charts...1 min and 5 mins ( my observation about object/RL shift explained here)











After US data we seem to have the Euro under some pressure after it's impressive rally in the last 24hrs ( would you buy Euros at 1.3450 -1.3500? I would not touch them with a bargepole at these levels). Re the DX charts...you cn see that the March DX chart gives us a hold on the LMLP in the MT chart but this is no so in the continious E-signal chart. If we see price action continue i will look for a long US$ position on the first shallow retracement. More to come