Wednesday, 29 February 2012

Gold...classic CL failure.....Aus der traum mein Herren?...

The dream is over for Gold? This looks pretty serious!!
With reference to Gold please see below this famous caption from Winter 1944 in the Ardennes! ( and how wrong they were!)

Slaughter in the EURUSD..What an absolute nightmare today.. I cut my short loss and then had a meeting out of the office mid afternoon and missed the action and had cut my short.....Now we are going back to just below 1.3300 at 1.3290..perhaps lower. A proper post on this pair to come/follow plus what i am/will be looking for for a possible - entry.

SELL March Soybeans at 1316-00 or higher with a stop at 1318-00 This is a major reveral area. Look at the MACD and Stochs..B-line & ribbons....this market is way overbrought and needs a 20 to 40 cent correction back to 1280-00

Thursday, 23 February 2012

Why historical forks are so important..yet again

This line marks the limit of todays move up and is a great place to look for a reversal of trend/contratrend trade entry. Draw this fork yourslef

Saturday, 18 February 2012

EurUsd...anatomy of a reversal

Wednesday Morning i was at my screen watching the European/London session kick off from 8am here in France and 7am in London (the server time in the chart is GMT+2 or Eastern European time) so with my coffee and pastry was watching minute bar by bar. The facts were that we had fallen sharply since the previous post and price seemed to be getting laboured and tired. The descent was slowing and becoming almost sideways. There was some structure form median and reaction lines but this means nothing as we have no way of knowing where price will turn until it gives us hints and indications by its behaviour. Also we were bang on the 1.30 level and just below. What would London do after the overnight continued sell off in Asia? What i saw was continued attempts to push it lower and this was with little success...a few more pips lower we went then bounced but failed to make a HH as price was trapped by the DS reaction line as can be seen below.

Watching all this live can never be replaced by retrospective analysis because the longer you watch live the more you lean or can 'gauge' from the behaviour as it progresses. It was becoming obvious to me that we were going to breach 1.30 where the reaction line ( & green ML) laygo lower but also i was aware that we may break back up out above 1.30 where i was looking for a potential long term 'long' position trade plus a short term long if it all went 'tits up' and we only saw a 20 or 40 pip rise before coming back down.
Price broke lower to 1.2986 where two identical bars( 5 min chart) on the green ML at 1400 server time was i thought a perfect rejection of going lower... however persitance to go lower was not over and as if with increased effort from price to go lower (as volume increased) gave us a new low at 1.2973. I had almost reisgned myself to a further fall sell off down to 1.2950/60 ( and you know how quickly we can move lower under such circumstances) and had almost given up looking for a reversal here when we made a mini double bottom on/just below the RL at 1.2976 at 1502 ( server time).......This was bullish but we needed a HH and to take out the 'roof' of the 'roman arch' of this mini double bottom at the juncture of the 3 reaction lines. The 'poke' bar came about 15 mins later - up to ( and then through) the reaction line at 15.19 server time. This was then follwed by some uncertain bars (but all higher) and a few mins later another 2 spike bars showed us that something was changing. This was the ideal point for a long entry using the reaction line and roof of the arch/double bottom as a place to put the stop under around 1.2986. Sure enough price retraces 100% to 1.2990 and retouched the reaction line and then the game changed and we were off in a new direction with a damm good bar up. If you had watched it live like i did (and perhaps you did) it gave me an understanding that cannot be gained from viewing the chart now. I observed the slowing of the descent, The urge to go lower and continious attempts to go lower , but all were thawted with just a painful few pips progress and then the general acceptance by price that the downside was over and all the energy/momentum that had been gathered on the way down like a coiled spring was ready to be expended in a new direction and then as a final effort the mini double bottom but with a higher low and the downtrend was dead. Fascinating and exhausting to watch!! But i have only mentioned the pure price action what about indicators? What were they telling me?What about forks and reaction lines?
On their own they tell me nothing and without watching the price action they are all simply pure 'fluff' and can tell me whatever i want to see.
There was some divergence ( 5m in and higher TF) but so what...on its own this is wholly unrelaible. I can draw mini forks but again only watching can reveal the subtle change in behaviour the preceeds a change in trend.

Perhaps at a stretch you could call this a 'over and under' divergence setup in the 10 min chart below but its not cleancut case( is the 7-3-3 below the 21-10-4? by a whisker?)...however if you add the two together then you have more evidence for a reversal but no proof in advance...but I had more clarity from watching the several hour long episode that was this bottom and at the end of it felt as tired and exhausted as price did trying to go lower BUT i could see & feel that the very dynamic of price's behaviour was changing and no indicator can give you that. Infact to be sure even as we made successive higher highs i still had no reason to believe we would not fails and fall again ( hence my position of a keeper and a short term profit. In the end i closed one lot at 1.3055 and the second at 1.3087 ...I lack the confidence to run a really large profit on trades and even though i look at this as a success if i look at my trading overall and all the energy that goes into it i would have made double/triple etc if i had learnt to leave my positions alone and not get obsessive about them. Infact some of my greatest trades have been when i am out of the office and away from the screens and cannot interfere with the course of the trade!!

I guess i must also ask the question....did i need to watch this bottom/reversal forming? Would it not have been simpler to wait until i saw the change in direction and then pick a long entry in the trend direction on the first or subsequent minor retracement? The answer is yes and no. Yes it would have been 'easier' but not as rewarding as i believe there is no substitiute for watching bar by bar.

Tuesday, 14 February 2012

EurUsd....will it? Won't it?.....continued...cont

Perfect symmetry.. The black fork shares the same LMLP as the CL of the magenta fork. Support lies at 1.3044 at this line

EurUsd....will it? Won't it?.....continued

Looks like the answer is 'No, it won't'! There was a trade in there but alas it didnt take it as i have other markets to focus on today.

EurUsd....will it? Won't it?

Theres a definative objective here and what with the data coming later today we may see either a meltdown ( failure to reach the CL at 1.3240) or a surge back up to the 1.3280 1.3300 area. Persoanlly i favour the upside in part becuase of the failure to reach the grey CL (Esignal) in the D/S fork...however i do not like the look of the ribbon stochastics in the daily charts (Ensign) but then price can do what it likes, when it likes and they will follow (but its worth bearing in mind that they are on the way down but this fact is offset by the Bline remaining in the zone). If we start to form a top here at 1.3200 we could have a short position but i will watch to see how tired price becomes at this level but if it fails to deal with 1.3200 we could see a sharp retracement but I suspect we will not test the overnight lows.

Sunday, 12 February 2012

EURUSD...So good ive posted this for thought? Where is the true location of any line?

If I had known about this anomaly (on the same simple chart displayed both below in log
and arithmetic scales on the 18th January) I would have made a serious position trade here. I have seen this phenomenon many times before and it begs the question.. where is the true location of any linear object within a chart and even more important the raltion of one or more lines to each a Median line set where there is a defined mathematical relationship between each of the lines in the fork. This fact is revealed when you remove the fork as a mathematical entity from the chart and replace it with superimposed simple trend lines. Try this yourself. ( Remember i have always used arith charts and still work in them 99% of the time but always hit the log button and then the % scale button to view the different locations that are displayed).

Simple normal (arithmetic) scaling:

The same chart below but with a log scale

The above two charts were posted last week but here is a link to the very basic mathermatics we are considering.....This Esignal version 10.6 has three options. Arithemetic/Log ( full log not semi log) and then percentage .below is as of today Sunday 12 February 2012 and shows both sets of lines in the arith scale but the thinner green lines are the logarithmic locations.

Friday, 10 February 2012

EURUSD tailor made entry using Schiff fork in micro TF

This should be self explanatory....once the trade is entered you can revert to higher time frame templates. Here there is a CL failure at the confluence of the downsloping UMLP and its Schiff blue CL

Wednesday, 8 February 2012

Corn...chart clarified,,,,,,continued

Is this a bullish candle or what? Return to 600 looks unlikely and a breach up and over 650 would tie in to my overall view of sharp rising commodity prices in 2012....after all look at your charts between October 11 and Jan12 plus here LME Nickel below.

Corn...chart clarified

Just incase you can't get your head round the Corn charts below here the simple controlling swing and the reaction line that i refered to below but you probably cant guess which one it is. Also if you read this blog you will know that i am preoccupied with line location..the idea that where a line is in the 4hr is not the same as in the 60 min...see the reaction line above. The RL is not touching (but close) in the high time frame 240 min but in the 60 min its pierced the r-line....this is what i refer to and for a tight entry and no false signals you ( I) need to know exactly where the line is and where the reaction ( support/resistance) will be.

EURUSD & Corn March12

The euro has continually failed to break out after its stellar rise but its got ahead of itself and the continuing uncertainty of fundamentals leads me to think we may see a retracement below 1.3200 or a powerful move up over 1.3285.....

Corn is another matter: It simply is range bound and makes for some great trades if you get them( entries) right

Below the daily ( Arith)

Below the log scale reveals reaction lines constraining the range

Below the March contract (CFD)

Another template below

And yet another below, but they all have downsloping reaction lines of value over 85D

Is this a fully blown move back to below 600 or is this a retracement before an continuation move back up over 650? I do not know but both Wheat and beans look tired Heres march wheat below:

Tuesday, 7 February 2012


small scalp (short)

Thursday, 2 February 2012

Corn H12

This is March12 Corn after the opening today 2nd Feb and following on from this mornings and yesterdays posting and short trade.
Here is a downsloping fork drawn off pivots from the last few days in the 30 min TF. The effect of the confluence of the up sloping dominent fork in blue ( with 1st WL in red)

Corn ( March 12)....continued.The bigger picture

Here is 5,15,30,60, 240, min and daily charts. The daily chart has had the low time frame forks removed and is included to draw the comparison with the E-signal charts in the previous posting and to show the bigger picture. Position closed 635.25