Euro$ Thursday 15th April

OK, here are two Ensign 377 tick Euro$ charts with reaction lines. On the RHS is a Metatrader 60min. The aqua/blue up sloping ML is the one represented in Ensign chart. We are at a very important point for price direction having nearly closed the gap( see monday's post) from the Sunday/Monday Asian overnight trading session ( the gap was due to the Greek debt debacle i am told...but who cares about fundamentals) and we are under a reaction line and on the centre line of the aqua blue ML set.
If we get over the RL and then re-test it- and hold the RL, then i favour the upside and will go long if an indicator tailored entry point can be found. The Stop will be the centre line/reaction line some 10 pips below. If we cant get through the RL then we are going lower and the same approach at this point using the confluence of the CL & RL could give you a setup with indicator confirmation.

Euro$ & GBP both on overhead reaction line resistance

Sterling $ 240 and 30 min






Euro$ 240 & 30 min

Crude Oil (CL#K) Result

Following on from the last posting on this blog yesterday PM, the reaction line was as effective as any Median Line and above is the resulting change in price direction. The fact that the reaction line follows the same/almost identical path as the first lower warning line from the Red up sloping ML set in the esignal chart (right above) is not lost on me.

Where from here for Crude Oil? If price does not return to the centre line in the blue Schiff then it is going higher. There is either a big shake out coming (which would need a price drop of over 4 $ to get to the blue Schiff centre line) or we test the UMLP and go through higher.

May Crude Oil Reaction Line support + trade

May 2010 Crude Oil showing a 240 min chart and a 5 min. Price has fallen as anticipated ( see Fridays post & trade) from the UMLP of the Schiff Median Line set. The diagonal red line is the first reaction line and price has arrived at the confluence of the centre line of the red up sloping ML set and the reaction line from the blue Schiff ML set. The 5 min charts shows the support from the reaction line (sadly the red centre line doesn't show due to distortion at very low TF's) and one the LMLP of a very low time frame ML green dotted down sloping ML set and the short term objective is the green centre line then i would not be surprised to see price return & oscillate around/above the reaction line until at some point either breaking through and continuing to the Schiff blue CL or going higher.

Gold update

As i expected last Friday ( see previous post) price ran out of energy & has reversed/corrected (after a steep rise) on the upper median line parallel at the confluence point of the reaction line and now follows the reaction line downward. At the time of writing price is bang on the 23.6% Fib retracement but we may see a small rally first as price has just touched the reaction line and may find support there.If price goes lower next target is to take out 1144.00$ area on the downside which is not far from the centre line.

June E-Mini S&P........The end maybe in sight

This is a market i avoid like the plague but i have watched, confounded by the strength of price and can find no downward sloping Median Lines. However this is the UMLP of a pretty obvious ML set. There is regular divergence on the daily chart on RSI, CCI and Macd...... What will price do here?

Trade the gap...Euro$

Overnight the Euro gapped up nearly 200 basis points. Although what i wrote about on Friday has come to pass and the Euro vs US$ has i believe bottomed (with a beautiful formation) and rallied strongly & i am short while the gap from the Asian session is being closed. The market gapped up (look at the stochastics) and hit the UMLP on the aqua blue Mod Schiff median line set and has reversed .I would look to take profits on my short position at 1.3520 and look to buy at 1.3450-1.3500 but that all depends on price action between now and then.







All eyes are on May CRUDE OIL (see previous post) and cash/spot GOLD (also see previous post)..... May crude needs to take out the swing low at 84.12 and Gold is over the reaction line i mentioned on friday and was on the Upper Median Line Parallel and i am watching to see what happens when the gap is closed.
Euro$ trade stopped out at break even

Gold...prelude to a setup?

Cash Gold- 240min & 30 min. We are on the green UMLP and at the confluence of a reaction line( the touch on the UMLP cannot get much better than this...look at the 240min chart) after what has been a meteoric rise in just over a week. This on it's own means nothing but this ML set has displayed good price activity around the centre line and at all previous reaction lines. We may still go higher but we already have Macd/RSI/CCI divergence( & the Stoch is flat at over 95) and the market is looking distinctly toppy to me. It's too early to go short and i am always very wary of selling short on the upper median line parallel in a up sloping median line set but there's a Mod Schiff 5 min ML i am watching as confirmation(see below).

Crude Oil (May 2010)..Update 2

Well....This Schiff UMLP worked a treat but we still have not taken out the previous swing low at $84.38.... so the jury is still out BUT the day is young.

Euro $ update 3

Price has reached the centre line and i have/would take partial profits here as we are bang just under the first reaction line(dashed dull red) of this ML green upsloping ML set.

Euro$ update2

Euro on the move....even as i write. small TF ML's drawn in dotted lines to aid& ID supp/res

Crude update

This is the adjusted Schiff ML set (see previous post). Is somthing is going on here at the UMLP or is this just a small dip? I have no intention of trading this line now but will watch the opening of NY in 1hr30. Personally i favour the original Schiff or the yellow UMLP.

Crude Oil

This is May crude Oil. The bue down sloping ML set is a classic Schiff ML ( from P0) and fits well with recent price action on it's UMLP. It maybe a one -off line of resistance and break through as we are a long way from the blue centre line and if price can't make it there then it's going higher.....or (especially as it's Friday) we could have a sell off which i think is a distinct possibility as we have come from the 79.50 area to 87$ in a little over a week to 10 days. If you use the SL to the left of lower pivot/P1 (with the same Schiff ML set) then price is right on the UMLP at this level and no previous bar has penetrated the UMLP. The Yellow UMLP is more important & is from an obvious Andrews ML set drawn on the daily chart with P0 at 83.94 on 11 Jan and P1 at 69.50 on 5 Feb and the recent P2 swing H at 87.07 on 6 April.

Euro$ update

Looks like price is on it's way to the green centre line and there are alot of long term short positions to be covered that will (in my opinion) carry it there. Initial resistance mid morning Euro/UK session at the two reaction lines and expect price to drop back but then continue in what promises to be one of those volatile Friday afternoon sessions.

Euro$

Support for Euro$ on the lower median line parallel of my long term modified Schiff ( thick scarlet)...albeit a bit unorthadox but still viable and within the rules of Andrews.To see P0P1P2 refer to small e-signal image on yesterday,Wednesday April 8th.

In the 60 min chart i have used simple Fib time zone expansion using the swing low on the LHS as point 0 then point one was the first swing high and then it all fell into place with the swing high at 1.3590 as point 2 and so on... which gave us the point yesterday & today. Entry point for a long trade?...perhaps a retouch of the scarlet LMLP. The green up sloping ML set that has been drawn ( many would say prematurely) was included because P1, P2 and the half way point between is perfectly described by the Fib time zones. There is a long way to go before a previous swing high is taken out and this ML set is viable plus there are two red reaction lines that may prove too strong resistance for price but overall i remain optimistic. The fact is not lost on me that one of the reaction lines is from the long term ML set on which lower ML parallel price has found support( you can see it dashed deep red on the 240 min chart on the thick lower scarlet ML parallel at 45 degrees in bottom RH corner buy the Fib time number 4)......this could be a turning point.

$ ¥..Reaction lines .......again.

Two Metatrader charts of USD JPY...daily & 240min ( i favour MT because the custom indicator i use for ML's draws reaction lines, innerlines Fib or %, trigger lines which is not possible to the same degree with Ensign ( i am new to this platform and there might be an add-on available) or E-signal).

Price has fallen from the UMLP/Reaction line confluence area and followed the angle of the red Reaction Line and now we have arrived at the green centre line after a 38.2%Fib RT (from the Swing Low of 90.00 area on 23 March to the recent S-High at 94.70 area). Will price hold on the centre line and then penetrate the reaction line are start to use it as support? Or could it just as easily retrace back to 92.00 ?

If you look at the daily chart you will see two median lines sets. Both have reaction lines drawn in and these reaction lines always have a dramatic effect on price and are a crucial timing & support & resistance,reversal tool for potential trade setups.

Euro$

Here is an Ensign 60 min chart with a downsloping ML set with reaction lines that captures the recent swing high at 1.3589 on the UMLP and shows price today having touched the centre line and held for the moment at least. If we form a new swing low above the previous March 26 swing low of 1.3266 then this would look a very attractive buy( given a good trade setup /entry) for a bounce upto the 1.3450 area.

Gold

A Metatrader 240min and 60min chart. In the 240 min price rises sharply and touches centre line and has dropped back. In the 60 min chart another smaller ML set (in Magenta/purple) that duplicates the same frequency as the larger ML set shows several touches on the fork and centre line. In addition there are some vertical time cycle lines not doing a bad job of picking out recent swing highs and lows. A 23.6% Fib retracement would bring us back to the magenta centre line at about the 1135$ area but this is not a market that i want to be caught very short of until we have an confirmation that we are undergoing anything more than a small retracement.... but i still think there are still possible short trades for a few bucks if you entered above 1148.00$

Euro $ Wednesday 7th April 14:40

60min Euro$

This looks as though we are on the lower ML parallel but will we hold here? If we do (and i suspect we will) there are buckets of other longer term ML's that could provide support at this area and below.

$ JPY

Another reaction line (feint dashed red in top RH side) in this 240 min Metatrader chart with green up sloping ML set. Price nearly touches the UMLP after a nice sharp trend upwards from below the centre line (& re-touch) but price falls away along & just before touching the reaction line.

Crude Oil

Update CHFJPY Reaction Line trade

Here are two set of charts. E-signal daily and 60 min and Metatrader daily and 60 min..both showthe same pair (CHFJPY) . The E-signal composite feed is more accurate. The background to the trade can be found in last weeks numerous posts on the subject. The reaction line now acts as resistance. My weakness on this trade was impatience as i was initially stopped out as i entered too early but re-entered the trade on a break down away from the reaction line with a affordable stop (now at break even).Objective the long term Magenta/Purple centre line.

£/$ You Know you have got it right when......

Here are two £/$ charts. Both on Metatrader. One daily and one 240min. Two different ML sets. Both showing inner lines and both showing reaction lines (BC parallels at distance of A to the middle of B/C). They all have other median lines running across the screen....usually from a higher timeframe and as you can see all these lines interact with price. However i am interested in these two charts with the Reaction lines (in red) as they provide advance warning of a possible price turn around. To me this is exactly the same as price walking into a brick wall !...looking back at some recent examples i can see reaction lines at many crucial reversals this week and as with my example this week on CHFJPY( see previous posts).Trades are possible but lower time frames (unless you want a stop so far from your entry that you can drive a bus between entry and stop) are more suitable. In the 240min Sterling$ chart you can see that price turns and runs out of energy at the exact intersection of the centre line and the reaction line. In the daily chart price finds support after a monster decline and reverses on the reaction line (although i have other MLs providing support here but these are omitted from this chart for the sake of clarity).





Whats happening with price here in the 240min chart does not mean that price will be held back and continue to fall...It may pop over the reaction line and start using it as support but the reaction line will continue to act on price until price/time pass away towards the next reaction line. Remember that there will be many ML sets in multiple TF's that are not drawn here that all have reaction lines and to draw them all on a single time frame would look like a birds nest..however i have individual charts for 30,60,240min and daily & weekly where i plot multiple ML's & reaction lines to provide an composite market map which can be used to identify possible reversal trade entry and exits areas. The bottom line here is that reaction lines offer you an advance warning of an area of higher probablilty reversal.


If anyone requires the free Metatrader custom indicator for drawing reaction lines( plus Schiff,Mod Schiff, innerlines,triggerlines etc) please ask.

US$ CHF

This is a updated short term pair of ML's shown in 240 &60 min with reaction lines. Although today's large whipsaw movement is probably not over and many would say that it is too early to draw a ML set using the single bar/candle low at 1.0434...just look how it works!... with price touches all up the handle and the centre line almost hit as well. The Blue P0 is debateble and i have used the swing low nearest to P1-P2( to guage the first possible reaction line zone) but it extends back perfectly to the previous swing low (illustrated with a dotted blue line).

ChfJpy...Reaction line hold price @ 92.00

See previous posts re CHF JPY

CHF/JPY ....possible - trade coming up

Carrying on from my look at this pair over the weekend there is another possible opportunity about to present itself for a short trade of a down sloping UMLP of the red Median Line set. More importantly the timing of this trade is indicated in the MetaTrader chart by the red reaction line in the Aqua/Blue upsloping ML set in the daily chart. Price has certainly run out of energy on this red UMLP and personally i am not waiting for price to touch the reaction line which i calculate is either today or tomorrow (Good Friday) but will be using a trade setup combining a pattern and indicators (which show regular and hidden bearish divergence in multiple timeframes for this currency pair).