ChrisJust another Blogs.forexfloor.com weblog

EURUSD – The Bi-Polar Pair
After selling off for most of the year, the pair has formed its first 3 week gains on a closing basis.  But whats most interesting about it is the pair literally has not gone anywhere forming the ‘dueling swords’ formation after double bottoming off the yearly low while ponging off the Kumo bottom.  Ultimately we feel the Kumo is too thick and at best the pair will climb to the flat bottom coming up where it will get sold off again.  For now, bulls can enter off the lows just below 1.3300 while bears can sell at the kumo top.

GBPUSD – Trying but Complex Structure Ahead
After bouncing off the yearly lows where we suggest 3 weeks ago to take buy positions, the pair has entered the Kumo but is hanging out on the lower fringe.  It bounced off the Tenkan using it as support to start this week and may test that line again which is falling.  The 20ema is also coming up above so will act as resistance and likely reject the 1st attempt.  The flat Kijun and strange but thick kumo structure suggests any gains will be hard fought and the line of least resistance is to the downside although the Kumo structure suggest more complex price action with a mild downward bias.  For now, we feel the only real play this week is to take the 1st touch selling off the 20ema for a move back down to 1.5300.

AUDUSD – Threatening the Expanding Triangle
After taking on some losses from the Goldie Sachs risk aversion theme to end last week, the pair threatened to break back into the expanding triangle.  However it has since bounced off it perfectly and should it make some gains in the next London/NY session, the pair could be headed back for the 09′ highs at .9412.  With the Tenkan, 20ema and Kijun below, we feel the pair will be well supported on dips and should it break back into the triangle, it may trap some bears thinking a pattern failure only to bounce back up from those lines.  For now, its tough to add new bullish positions unless taking a touchdown on any of those lines or the triangle top for a possible 9400 touch and hopefully an eventual break of 9500 for  a retest of the 08′ highs at 9800.

USDCAD – Back to Back?
Attempting to do something it has not done in a long time, the USDCAD is attempting to make back to back weekly gains.  Although we think the strong gains last week were merely a product of the Goldman Sachs suit causing a short term risk aversion play, the pair could make some more weekly gains.  However with the Tenkan, 20ema and Kijun all tracking down and not far above, we feel any gains will be short lived as they have held and rejected the pair on virtually every attempt except one which resulted in a strong failure that sent the pair selling back in Feb. of this year for 6 of 9 weeks touching off parity.  For now, the parity level holds but with this type of Kumo, we feel its only a matter of time before it gives way.  If it gets back to the lines – look for a sell back down to even-steven.

EURAUD – Possible Play of the Falling Tenkan?
Ever since this pair topped at 2.1000 back in 2008, the pair has been in a virtual free-fall selling off every 2 out of 3 weeks.  Last week it formed a bullish candle as the AUDUSD sold off massively during the risk aversion theme that blazed through the markets last friday.  But what is most interesting to us is how the Tenkan has held virtually every attempt save one to reject the pair back down for more weekly losses.  The one time it got past it, it hit the 20ema and began selling again so we feel the defenses are in place and the AUD is likely to outpace the EURO for some time now.  Should the pair give us another touch on the falling Tenkan, we like shorting this pair for a move back down to 1.4500 which 330pips from the white line.

This is just some of the techniques and methods we use to trade the markets.  If you are serious about learning how to trade and advancing your learning curve, then check out our courses such as the Advanced Ichimoku and Price Action Courses for further training where you can also join a community of traders and get permanent access to our forum for continual education.  For more information about our services, visit http://2ndskiesforex.com

EURUSD – A retest of the 10′ lows likely
As we wrote last week;
From an Ichimoku standpoint, the Tenkan is likely to limit upside gains and is currently posted just above the 61.8% rejection of the last downside swing from 1.3815 to 1.3421 so these levels should hold.

This is exactly what happened last week as the pair had a high of 1.3590 coming within a dozen or so pips from the Tenkan/ Kumo bottom and rejected at the end of the week while following it up this week with nothing but sales.  The pair is now pressing against last weeks low and the Tenkan will likely again hold any upside rallies to the mid 1.3550’s for those looking to short on a rally.  Now the pair looks set to challenge both the yearly lows at 1.3267 and should it break this level – the 1.3075 area before running into any buying pressure.  We are looking for nothing but shorts at this point and feel the pair could be headed for some serious losses in the coming months.

GBPUSD – Back Down to the Yearly Lows?
As suggested last week;

The good thing is if you want ot be a bull, now is a good time as the pair is really close to the 10′ lows and gives traders a really nice risk to reward setup for going long.

The pair rallied last week off the yearly lows to bounce 400pips so hopefully the bulls got to make something off this move as we suggested.  The pair has since rejected off the Tenkan just like the EURUSD
has and its possible the pair will make another run down to 1.5000 and the lows around 1.4800 where the bulls will undergo another stress test of their mettle.  At this point, we feel bulls and bears will have to wait to take any decent positions since the prices are now off the highs and lows.  With the range being so clearly outlined, we suggest only taking intraday plays with a greater favor towards the short side.

AUDUSD – Attempting to Break the Expanding Triangle
After being stuck within an expanding triangle for the last 5months, the Aussie looks like its about to make a legitimate break of the pattern.  After bouncing off the Tenkan 3 weeks ago, the pair is pressing heavily against the upper trendline for the pattern.  It does have 2 other stops to clear beyond this line at the 10′ highs at .9327 and the 09′ highs at .9403.  Beyond that there is the big figure at 9500 and then parity.  Considering how well the pair has held up while the dollar has rallied, also combined with the super thick Kumo below and possible upcoming Tenkan / Kijun cross, we feel the pair is likely headed for another run to the upside should it break and close above the upper trendline.

USDCAD – Will it break Parity?
Considering the pair has sold off 7 out of the last 10 weeks and rejected off the 20ema 2x in the last month, we feel the pair is likely headed for further downside.  All three lines (tenkan, 20ema and kijun) are all falling at a strong angle so even though there is no new signal, the current downside signal in play remains.  Moves back up to 1.0200 should be considered as good rejection plays to short the pair again.  Also breaks of parity with closes below on a daily candle will also trigger fresh sales.

EURJPY – Previous Ceiling = Possible Floor?
Just when the pair was set to make another good upside push, the pair got slammed to start the week and is already down about 240pips.   The pair literally opened and sold off from the beginning suggesting last weeks break and close above the 20ema may have been a false reality and created a bull trap.  The pair was stuck in a range between 120.00 and 125.00 for 2mos and is rapidly approaching the previous range ceiling at the big figure.  Should this level collapse – the pair could be set for another run down back to 120.00 but will have to get past the Tenkan first where some longs may be parked.  The alternate scenario is the 125.00 floor holds and sends the pair back up but considering how strong and impulsive the fall is, we’d rather wait for a 2nd touch or double bottom a day after the 1st touch before we consider putting any longs up.

This is just some of the techniques and methods we use to trade the markets.  If you are serious about learning how to trade and advancing your learning curve, then check out our courses such as the Advanced Ichimoku and Price Action Courses for further training where you can also join a community of traders and get permanent access to our forum for continual education.  For more information about our services, visit http://2ndskiesforex.com

EURUSD - Short term base in place
After now 5 failed attempts to close below the weekly Kumo and 5 rejections with the last one forming a higher low, there appears to be a short term base in on the pair at 1.3500.  To note the pair has yet to on a weekly and daily basis close below 1.3500 so there is some traders willing to make a stand here.  With that said, we now have a clear line in the sand with buy orders possible at 1.3500 with stops below the lows and targets set to 1.3700.  This also means any closes below the lows will likely start a new wave of selling for the pair but for now, short term gains may be had on a re-test of the big figure.  Upside will have to contend with the falling Tenkan which should be its first test.  The pair is inside the Kumo which is rather larger meaning we are in a directionless market until price emerges on another side.  It should also be noted the pair posted its 1st weekly gain in over 10 weeks.

GBPUSD - Double Rejection off the Lows - Next Move is Tricky
This is one of the more interesting charts technically.  The pair formed a serious rejection in the previous week which suggested there were some buyers in place supporting it as it was the fiercest rejection to date on the downside.  This was followed up with a similar probe which produced a higher low suggesting the hype may be real.  However to star this week the pair is pushing lower from the start so what we need is a third test to the downside which either a) make a higher low, or b) make the same low.

In either case, both are acceptable setups for buys to find their way back to 1.5200 and possibly to the fib projections between 1.5425 and 1.5475 so there are some strong upside targets in the waiting.  Keep in mind beyond that there is a falling Kumo until the middle of April which should hamper upside gains.

AUDUSD - Trudging along, steady as she goes
Inside an apparent expanding triangle (one of the worst price action patterns out there) the pair is possibly headed for a trendline which is potentially the basis for the price pattern.  Notice my three skeptical words in there (apparent, possibly, potentially).  I use them because these patterns are not only horrible to trade, but also very dubious and we would need a 3rd touchdown on the upside trendline to verify it.  If the line is for real, then around .9250/75 the pair could run into an upside test.  It has been climbing 4 of the last 5 weeks which is a solid showing and out of all the majors, its holding up the best against the USD to start this week.  Any dips should be contained by the Kijun/20ema levels around .8960 so there is a chance for a small buying opportunity with light positions.  The harbinger in this one is its virtually in the middle of the range which is not super exciting.  Other than that, the Kijun and Tenkan are flat so the pair is moreso coasting then boasting.  Eventually we feel the pair will run into the Kumo which will carry the pair back up for a 2nd attack on the 09′ highs.

USDCAD - New Sheriff in Town
Well, after three attempts and 6mos later, the pair finally broke the 1.0200 barrier and closed below it.  We feel this is probably the real deal so we are now only looking at downside plays.  The trick is where?  We could get aggressive and sell around the mid 1.02’s which is the most aggressive option on the table.  Another play is to wait for the 20ema to continue its song as its been holding the pair for some time.  Thus, any retracements back to this level are likely good sell opportunities to take profit 1st at the 1.0200 level and then play for a larger move down while protecting stops at this point.  The Kumo is massive and should hold any upside moves around the 1.0700 level and with the Kijun and Tenkan flat, the current overall drift is clearly to the downside so we will wait for our retracements and then look for shorts on the pair, perhaps even targeting the parity level by mid-April

EURJPY - Strong Base in at 120.00
Two rejections and two failed attempts to close below the 120 barrier have sent the pair back to the other big figure at 125.00 for a real upside test.  What is interesting to note is the pair had a very large selling week at the end of February only to form a higher low back to back weeks and come back to where it started.  Even though the downside action did in one week what took two weeks to the upside, the bottom line is this is a real challenge from the bulls.  The trouble here is both where the weekly highs line up and the Tenkan which happens to come in at the same level.  It is clear the 125 barrier is a hot button which should stir the order flow pot and really test the mettle of who is more serious.  The good thing is if you want to sell, the line is clear and if you feel like you want to buy, 120 now offers a good base or you can wait for a break and close above 125 for a move up to the 20ema at 127.50.

This is just some of the techniques and methods we use to trade the markets.  If you are serious about learning how to trade and advancing your learning curve, then check out our courses such as the Advanced Ichimoku and Price Action Courses for further training.  For more information about our services, visit http://2ndskiesforex.com