Euro bubbles onward

The chart shows an almost perfect breakfast trade setup. A high volume activity spike with an engulfing 15 minute candle started a move at 7.00 am that has just hit 200 pips at a round number and two Fib resistance points.

Yesterday, the Euro looked to test a multi-low but shied away from breaking below 1.39. It is now looking that there could be unfinished business at that level. For now the US$ is weak and we are staying with the trend, content to take these morning moves.

Markets are very thin again this week and consequently postion sizes are somewhat smaller than usual as the whipsawing in evidence last week could well continue.

George@clickevents.co.uk

Christmas Trading

The strength Cable showed early yesterday was short lived, followed by a sharp run down below the lows having briefly touched $1.49. Right now, $1.47 is the key level to hold, if it breaks then off we go again.

However, sentiment is so universally bearish and markets so often do the opposite of the consensus opinion, that I will be keeping a close eye if these keys levels hold.

Against the Euro 95 is still holding and is not yet a foregone conclusion that parity will follow. The potential MPR pattern has still to play out, either way.

These thinly traded Christmas markets are certainly exciting with increased volatility, moves are exagerated and stops easily picked off so take care!

Have a Happy Christmas and wishing you a Prosperous New Year.

George H.

This Correction looks serious

Cable is picking up strength this morning in these thin holiday markets and the EURGBP pair correction is now getting underway.

Resistance at 95 has pushed price back that has developed a multi Point Reversal pattern that could send the pair back down by a few hundred pips.

Review of Euro, Oil and Gold

The week ended with some very tradeable moves on the Euro. The weeks upmove proved unsustainable and Friday resulted in the sell off seen on this chart. This morning and afternoon move will have brought plenty of Christmas cheer to traders who caught either, or both, of the moves.

Looking ahead, we are keeping a close eye on both Crude Oil, that has now retraced most of the major upmove, and Gold, that many say is on the way to $2,000. The video review is now available to members at http://www.tradersclass.net/

Momentum and the Euro

Without a doubt the Euro is a one way bet this week after nine up days in a row, but is it just a one way bet? The chart shows the move but there are now several technical factors, including the round number at 9500 and the extension of this wave 5, that suggest some caution here.

As I write, the US$ is flirting with new lows against what is currently perceived as the most sound economic area in the world. The interest rate differential is now so far in favour of the Euro and add in the perception of the total lack of the US regulators knowledge of what is going on in their own back yard and it is no wonder that the US currency is being sold.

The latest http://www.tradersclass.net/ video is available to paid up members that reminds us that 1 + 1 still adds up to 2 despite these massives currency swings.

Onward to Parity?

And it's yet another day that the Euro hits a new high against the poor old British Pound. The chart shows a clear five wave structure so far, and now that wave five has extended 150% of wave one, I am reminded that markets never move in an uninterrupted straight line for ever!

The market seems to have parity at 1:1 in it's sights and, despite the above, there is no good reason to do anything other than stay with the trend - for now and until a reliable topping pattern develops.

TradersClass members can view the video updates on the Euro vs US$ and also the Swissy, both published at http://www.tradersclass.net/

Weekend Video Update

The weekend update for www.tradersclass.net members features the EuroJappy Fib Bands, the Euro, Jappy and Aussie with the S&P 500 and a follow up on the Swissy following this week's decline and rally.

The regular, Traders Class member login, will change this week. Individual logins for each member will be emailed.

Regards

George

Swissy Performs

The Swissy set up yet another BAT pattern this morning with a strong rally that sliced through potential resistance until the pattern kicked in.

Eventually a Multi-Point reversal formed with a false upside break. Target1 and Target 2, the low of the previous move, has been hit for a useful morning move.

TradersClass members, go to http://www.tradersclass.net/, log in with the generic login and watch the weekend video showing the Swissy performing with Waves, Fib, BAT and Gartley patterns. Any problem logging in email me george@clickevents.co.uk

Catching the morning move

Whilst the Euro and Cable look massively oversold against the US$ but keep going down, swing traders need to be alert to a bounce back that could come at any time.

Safer trades are to gather several modest moves during the main morining trading session that can add up to some significant pips. This morning the Euro put in small, false downside breakout, before recovering above the early morning trading range. As you can see from the chart this classic pattern also shows how the colour charts and gravity line managed the trade entry as price bounced off the blue line.

The next Forex trading workshop at the end of the month will cover these techniques in detail, click for info.

I am taking a week off from Saturday to relax and chill on an island off Toulon in France, my wife has insisted I don't look at a screen all week!

Euro

Well, Cable found no friends yesterday after an early morning scalp trade it was all downhill. Whilst Cable tumble, the Euro remained relatively stable and this morning it's showing signs of a recovery, held back by the shooting stars shown on the chart.

Despite markets bouncing around and so often appearing to defy logic, there are always plenty of opportunities and short scalp trades producing 20-40 pips keep presenting themselves. The major trend is less important for these trades when a combination of identifying a consolidation pattern, ideally at a fib retracement area together with evidence of strength or weakness from volume or basic price action is all that is needed. Plus, of course the trader has to be prepared to press the button without delay to both grab the opportunity quickly but also protect profits and avoid losses!

Cable recovering

The Euro gave us a useful intra-day run and now that UK banks are now uderwritten by the state, has given Cable the edge over the other troubled economies.

The chart pattern is developing with this potential base that could give us the start of a bounce back.

What a difference a day makes

The Euro is bouncing back this am forming a 'Cup and Handle' that just has the Sunday night gap in it's sights.

The Australian rate cut overnight has now set the marker for the UK to follow suit with a substantial rate cut.

And that's it for the Euro...

The Swissy bounced down through support and is now pushing against resistance as the Euro tanked overnight. The chart shows Cable and the Euro with Cable steadying as it bounces around the lower end of this major support zone. Short term charts are throwing in confusing signals in this very oversold area.

The bigger political picture has now revealed the fragility of the European accord with Germany looking after it's own interests at the expense of other members of the community. This weekend could prove to have been one of historical note for the future of the Euro.

In limbo

It's Non Farm day again that causes excitement on the first Friday of every month, figures due at 1.30pm UK time. Add to this the continuing uncertainty over the US bail out package,and it's no suprise that currency markets are going nowhere this morning.

The Swiss Franc shows how it tried to make a new high yesterday and resistance kicked in as it formed a double top on the daily chart. A break, either above resistance or below support, is needed.

Jappy Strengthens

This could be time for the USDJPY pair to move down. This morning it has gone nowhere, sitting within a plateau formation.

If it can move below the low of the day so far - 105.70, we could see some good downside moves.

Washington Wrangles

Whilst the Euro still looks vulnerable to a sell off, I am reminded of the old adage, Buy the Rumour, Sell the Fact.

The big rescue plan is now mired in negotiaitions and, supposing is eventually passed and approved, there could be a flurry of bullishness for the US economy and so the $ would strengthen. Alternatively, the markets could react once the 'good' news is out and the opposite would play out for the US$.

Marking time

Will they or won't they is the question on everyones lips as we await the US Congress decision on the bank rescue plan. Consequently the US$ is in a dither with false breaks one way then the other.

An ideal market for scalpers who take these 15-40 pip pops in their stride and make a good living doing these several times throughout the day without caring which way the big trend is going.

Still Blue

Cable has been charging ahead but then paused. The Colour Charts are still blue, add to that the currect 240min candle that is engulfing the previous one. Supposing this Candle doesn't reverse, it tells us the up move is not over yet.

Colour Chart Trade

On a morning when the FX market can't quite make up its mind, the Colour Charts managed a useful 45 pips or so . There were two entry points and one clear exit that just needed the trader to spot the change in colour.

The next FX workshop will fully explain how to apply the charts and find these morning trades.

http://www.clickevents.co.uk/forex-trading-seminar.htm

First trade of the day

Overnight, the majors made some big moves as the US$ gained from some semblance of stability returning.

The Euro bounced up nicely from a support zone for a very useful 60+ pip run.

Marking Time

After the excitement comes the pause. The Euro and the other majors, are in consolidation mode today and, whilst they have given us some useful scalping trades, the next trend has yet to show itself.

Above the blue line, or below this range, then I am getting interested but not before.

In praise of the Euro and Yen

There is nothing like a little volatility now and again and we have certainly had plenty in the last few days. Whilst Cable is pausing and correcting from its big move on Friday, one of my favorite pairs is the EURJPY.

This one has a typical daily move of 150-200+ pips, as the chart shows it moves in trends with useful rallies and corrections that enable the careful trader to jump aboard. Some traders prefer slow and steady movers but this pair, whilst needing wider stops, can generate the pips quickly.

Attempting a base

The Swissy correction soon ran out of steam and both the Euro and Swiss made new lows against the US$ that shows no real sign of stopping its bull run just yet.

However, right now, Cable is attempting a base at this 1.75 long term support level ahead of the MPC this morning. Others to look at include the EURGBP (down) and possible basing action with the EURCHF.

Swissy, what next?

Cable popped down through the lows later yesterday but is now right back up at levels from yesterday morning. Has the US$ gone far enough for now? If so, there are plenty of snap back candidates with the Aussie Dollar high on the list.

The USDCHF (Swissy) has been pushed back from an area of major resistance at 1.14 and the chart shows a possible reversal in the making. It is supported at the red line showing a double touch bottom, if that goes, then a correction could be well worth trading.

Quite a night

Following the NFP last Friday, Cable then completed a clear 'Cup & Handle' pattern on the 15 min chart than ran for an hour or so and it followed with an a-b-c correction and another saucer bottom.

The Fx market got it all wrong with the first reaction to the US Fannie and Fredie bail out that gave a 300 pip run this morning from an MPR top. So should we keep selling Cable today? The answer is in weighing up the odds of a break down through the Friday low as opposed to a potential bounce back.

Given that Cable has run through more than it's average daily range so far the odds favour at least a pause here.

Non Farm Payrolls today

Traditionally, NFP day is one to avoid as this monthly announcement can cause dramatic swings. Trading in the early morning and after the figures at 1.30pm is considered safer!

The EURCHF trade from earlier this week became a break out trade as the range broke and from yesterday Cable popped down to within a whisker of the 1.75 level at 3.00 am this morning as expected.

Right now it is setting up a very tidy saucer bottom that just might uoside potential - but watch out for NFP suprises.

Cable ranges

Whilst the EUECHF pair is flirting with the lows of the range at am all important round number, attention was on Cable on the interest rate day.

The morning trade moved up from a good base that followed all the multi point reversal rules. The chart then shows the pullback with a continuation candle and the it was all over with the final Shooting Star.

Today's expected rate statement and US figures has done nothing except to bring cable back to almost where to started today. However, there still seems to be more for the Dollar to do and students of the Bat pattern will have seen the target area on the weekly charts, not to far from 1.75.

Potential Range Play

The Swiss France has continued its run this morning and sooner or later we will get a reversal but there is no strong signal yet from the major currencies - with the possible exception of the Yen that is partially matching Dollar strength.

However, there are other crosses. For 5 months the EURCHF has been in a trading range that could of course break out. But equally, when price has reached the extremities it has bounced back. This is one to watch for clear signs of a bounce or break down.

Swiss Franc Weakens

The USDCHF daily chart shows just ho far it has moved as the US$ has strengthened against the major currencies.

Resistance lines showed the consolidation area as an intial target that is now below current levels. Price action has been positive throughout this area and there seems to be more to come.

USDCAD follows through

10540 was taken out cleanly and the rally gave us well over 100 pips. What next? Today is Labor Day in the US so trading in general is likely to be thin.

The USDCAD pair is now flirting with previous highs and several resistance factors here including Fib's, pattern prediction reached and so on could limit further upside today or set up a retracement. For now, we have seen a very acceptable profit for the taking.

The latest correlation video has now been re-uploaded and is ready for TC members here.

Maybe more to go?

USDCAD strength came in yesterday from the base pattern that held and the rally could have more to go. The next hurdle is a break of 10540.

There is the possibility that the USDCAD will be rejected here of course, particularly if Oil rallies. It has been sent back twice before from here and we could then see a double top pattern develop.

USDCAD

The Loonie daily chart shows a multi-day consolidation that is about to be resolved. The balance seems to favour CAD strength with a break out on this chart to the downside that could be good for at least 100 pips or more as the oil price looks to have stopped falling, an Oil price rally is good for the CAD.

There could still be rallies in the US$ from here of course that may present useful opportunities to sell at higher levels.

Cable strength?

The failed hammer gave some good day trades yesterday and today there is no downside follow through - so far. Evidence of consolidation is building up with the 240 min chart showing this continuation hammer.

The US$ is in lock step with a major correlated market right now and the latest TradersClass video, available later today, shows how to take advantage while it lasts.

Pattern failure

Back to the trading desks this morning following the UK bank holiday to find a candle hammer. However, as trading is now unfolding this could fail. Cable needs to drop below the lower tail and this type of failure frequently results in a good move.

The failure is never a foregone conclusion of course, as we saw two Hammers form last week that followed through for a one day rally, they were short lived but the fact that we are seeing several of these form suggest that bounce back potential is still very high.

USDCAD bounce

The Euro follow through to the downside yesterday gave a useful 45+ pips and then rallied strongly for another 40+. The video of the days Euro moves with volume is now avaialable to TradersClass members, http://www.tradersclass.net/.

The USD is attempting a bounce against the CAD this morning but volume activity is yet to confirm the move. Following the strong down day a bounce is highly likely but a break of this double touch bottom would see us selling this pair.

False Break

The Euro break now has some of the characteristics of a False Break Reversal, so uless support is is found very soon the long tail, Shooting Star, candle shown here points the way to lower levels.

Today's the Day

Yesterday provided a further consolidation day when scalp trades were the way to trade. This morning has seen a break above this week's range and 1.4780.

This rally could well have further to run unwinding some of the sharp fall from last week.

Watch the Euro

The Euro and Cable made a good run later in the day yesterday and the charts show a strong rally may still develop.

The hourly chart needs a move above 1.4780 to break the trend line and set up for the rally.

Sideways Day

On a day when there is very little momentum in either direction, it is useful to take a look at additional techniques that can help us with the detective work of fathoming the next direction.

This short video shows how activity charts can point us in the right direction: http://www.tradersclass.net/fxvideos/volcadswf/

Consolidation time

After the fall comes the bounce. If this turns out to be a flat, 'dead cat bounce' or a major retracement remains to be seen, but further falls in Cable are less likely today.

The 240 minute chart shows this is the longest period of consolidation so far this month and the change in colour of the blue candles suggests more to go during this consolidation phase. The Gravity line is also flat now and for a sustained rally, it also needs to turn blue.

Longer View

The US Dollar has become a one way bet and these major re-alignments brings some incredible swing trade profits. Day traders have to fight the tendency to attempt trading every little correction when the only game in town is to Swing trade the long move.

At some point soon there will of course be a convincing bounce back and the trick is to take profits along the way and be ready for the correction at major support.

So just where is this support? The weekly chart of Cable show there is a cluster of potential support points at the curent levels. If, and/or when this area breaks, the way seems clear all the way down to the 2006 lows at $1.75.

Swissy takes off

The USDCHF pair has been wandering but not selling off today and late this afternoon it may well have resumed its clime as the US$ strengthens and the Swiss Franc weakens.

The 15 min chart shows an early entry opportunity but further low risk entries may present themselves if we get some pull back corrections.

More basing activity

After the mini bounce in the Euro that just gave a scalping profit of 20+ pips.

There is further basing evidence in the Euro, Cable and Aussie, etc. All have the potential to retrace if they can get out of the base area.

And now the Euro

The Jappy trade produced over 150 pips and this morning it could be the turn of the Euro for a bounce back trade.

The decline has moved a long,long way in just a few days and the 240 min chart is showing clear signs that it is not going lower yet. This may be just a temporary reversal but good for a trade or two.

Jappy Strengthening

Despite the big four putting in new lows against the US$, the Japanese yen didn't take part.

This morning it's the strong one and the USDJPY pair just might make a break below the yellow line.

Correction Day

After the sea change that occurred with the US$ last week, it's time for a pause. The majors today are recovering a little against the dollar and the chart of the USDCHF shows just how far extended the move became.

The Swissy hit the Fib extension resistance area at 10850 and has made a useful correction back this morning giving 60+ pips before breakfast.

Onward and upward

The Swissy has just moved another 240+ pips from the 10510 area and this running trend of US dollar strength could well have much more to run.

However, there will be bounce backs from time to time so taking profits along the way and then adding back in can build a large position whilst taking and preserving profits along the way. The blue arrows show clear add in areas on this 8 hour chart and many more can be seen by focussing right down to the 15 min charts.

Enjoy the trend!

And the Swissy performs

The USD against the Swiss France showed little sign of selling off early this morning and continued to make higher lows before moving sharply higher for an excellent day and multi day trade.

Right now, the blue lines show the wave mutiple target has been hit for today and is in the region of the previous daily highs so we are not expecting too much more action in this session.

Swiss Franc update

The USD against the Swiss Franc made a new high earlier today but has yet to follow through.

Technically, it has moved up strongly in recent days and has formed a series of waves that, as the chart shows may have completed with the yellow lines at equal lengths.

Also, price has retreated a good many times from this area and the hourly chart had formed two bear candles.

If the next days trading does not follow through on the upside, the combination of factors above will conclude today's price acation is a False Break that is highly likely to become a reversal.

On the move

This morning the Swissy is following through with the start of a weakening phase that could see a running trend as well as a useful day trade.

Where next for the Swiss Franc

Whilst the Euro continues to show signs of a further move down unless a temporary rally kicks in this week, the GBPCHF weekly chart show just how far down the GBP has moved over the last year. The general consensus is of course that the UK Britsh Pound is a very much weaker currency than the Swiss Franc.

Three up weeks in a row has brought price back to the resistance area that has stopped previous rally attempts, so some further sideways action is likely before another attempt at a break out.

That the Swiss France has been so strong over the year is no surprise given its historical role as the worlds safe haven currency. However, recent events have tarnished the reputation with the UBS announcing a mega million write down with the rumour of more to come resulting from dodgy sub prime deals. This sort of thing just won't do from what was perceived as the safest currency in the world.

Euro waves

At 1.30pm London time today, the Euro exploded upside on the US employment numbers were worse than expected. The chart shows the lastest candle correcting back strongly so what happens next?

Elliott Wave watchers will spot the blue lines showing a clear five decline that came to rest at a support area. After a five wave move comes an a-b-c correction, so which wave do you believe is shown as the last candle?.