Euro Dollar Trend Line

The USD/CAD had a bearish day yesterday then hit support and bounced. Using our money management techniques most of you should have profited well from that. We have this on our watchlist again waiting for a suitable set up in addition to the USD/CHF.

The EUR/USD hit our trendline precisely and reversed (after the fakeout). This too is on our watchlist for Monday.

The CAD/JPY & NZD/JPY recently entered our buy zone and have provided profits but beware of the AUD/CHF which although has also entered the buy zone but is at the figure with a possible signal line divergence.

Hope you all have an enjoyable weekend.

FX Analyst
Anne Chapman

Euro Swissy MOB Level

The Euro Swiss Franc is at a resistance level. This level is based on MOB, proximity of two trend lines and a 0.618 fibonacci level.

There looks like a chart pattern head and shoulders formation in creation but as it is not complete we cannot assume that it will form. Alternative chart patter perspective is a spike and handle.

This cross is going into our watchlist and what we will wait for is a breakout bar (either direction) for an entry after applying our ESLT.


Chart courtesy of Advanced GET. Data provided by eSignal.

Good trading.

Forex Analysts
Javid Shaik & Anne Chapman

Bear Flag

Good morning.

The Euro took a hit yesterday and we could see further decline on this pair today. A contrarian view could be on offer.

We were asked if we could expain our forex anlaysis from yesterday on the bear stance of the Dallar Canadian so here it is.

The trend is down although more recently it is in a range. Short term it looks like we have a bear flag formation. The MACD did not converge. The figure is not far from currenct price action. Lastly, we have a sell signal on our strategies which incorporates a very tight stop loss.

Now, the truth of the matter is it does not matter from a discretionary trading point of view if this pair is going up or down, either way a profit can be established in most cases.


Chart courtesy of Advanced GET. Data provided by eSignal.

Good trading.

Forex Analyst
Javid Shaik

Dollar health

Welcome to another week of trading. Yesterday was a holiday here in the UK and in the US so volatility was quite low and not a day for trading.

We are looking at USDCAD for shorting as it is looking quite weak. The same applies to the USDCHF which recently produced a reversal signal. A BOB on the USDCHF below 1.0200 could provide some pips.

We are not providing charts on these two currencies today as they are quite easy designs to analyze. The fundamentals on both the Canadian Dollar and Swiss Franc seem quite strong.

Todays New Home Sales are forecasted for 522k. This should be interesting.

Until tomorrow, good trading.

Forex Analyst
Anne Chapman

Cable resistance

We have found resistance on Cable and have now closed this position. This pair is now on our watchlist and we will wait for a buy / sell signal to appear before entering a trade. We are coming to a squeeze so we could possibly see some range bound activity.

We will be away until the end of this week so our next update will be on Monday.

Good trading.

Forex Analysts
Javid Shaik & Anne Chapman

Pound profits

Good morning all.

It's time to take profits from the Pound Dollar trade if you are in it still. We are at the figure so lock in profits by moving up the stop loss.

The Euro Dollar has also hit the figure so if you are in this trade and we know a few of you decided to jump on this at the same time as the Cable based on the three musketeers then it might be a good time to lock in proifits.

The Dollar Canadian is breaking dowd today and should this continue then we have a support zone at 9920.

Good trading.

Forex Analysts
Javid Shaik & Anne Chapman

Expected figures

Good morning.

We are awaiting a couple of figures today and they are expected at 940 and 62. No new positions have been opened.

The GBPUSD is holding it's place but has not produced any bullish signals. It is range bound and hovering just above the support level. Today's figures could well have a bearing on that.

Next update will be on Monday morning, have a great weekend and enjoy the FA Cup.

Good trading.


Forex Analysts
Anne Chapman & Javid Shaik

Downside support tagged

The Pound Dollar has been in a downtrend and our post back in April mentioned the pair could see 1.94 zone. Here is that forex analysis.

We have hit the support level 4 times so it seems to be quite good but if we breach this area we could see even further weakness. A confluence of events involving MACD convergence, candle reversal and the figure plus obviously the support is a good long opportunity.

A couple of factors to be aware of relating to the above. The trend is down and Bernanke is speaking today. A long position at this stage is a big risk as it is against the trend but the stop itself contains a smaller risk.



Chart courtesy of Advanced GET. Data provided by eSignal.

Good trading.

Forex Analysts
Javid Shaik & Anne Chapman

Euro Kiwi

Take a look at the Euro New Zealand Dollar below. Stochastics shows overbought and we are at a previous resistance. Watch for a breakout with ESLT. Note the location of the MOB and moving average.


Chart courtesy of Advanced GET. Data provided by eSignal.

Good trading.

Forex Analysts
Javid Shaik & Anne Chapman

Aussie Dollar Resistance

The Australian Dollar has been in an uptrend and is up over a 1000 pips since this time last year.

Have we hit a top again? The resistance has been hit 3 times and is now in a triangle. The resistance is at the figure and MACD divergence should be noted aswell.

Wait for a breakout / breakdown then use our ESLT.


Chart courtesy of Advanced GET. Data provided by eSignal.

Forex Analysts
Anne Chapman & Javid Shaik

Pound Aussie

You may recall back in April we analyzed the Pound against Aussie Dollar. You can view the forex analysis here.

The price broke down after it squeezed and we have support at the MOB. Prior to that the 2.0500 zone could provide psychological support too.

At the moment we have a convergence going on and the last three bars have all been static. We have locked in our profits on this one but still think we could see further weakness longer term.


Chart courtesy of Advanced GET. Data provided by eSignal.

Good trading.

Forex Analysts
Javid Shaik & Anne Chapman

Yen Breakout

We have captured profits from the Dollar Yen this morning after yesterdays breakout. You can read yesterdays forex analysis here.

Some news out today regarding Canada and trade balance from the US also to be aware of.

Other than that it is a fairly quiet day so we can pack up shop quite early.


Chart courtesy of Advanced GET. Data provided by eSignal.

Good trading.

Forex Analysts
Javid Shaik & Anne Chapman

Euro downtrend & Yen breakout

The forex analysis on Friday stated the Euro could continue to 1.5350 which we have done. A BOB below this point then we could see 1.5000 zone.


Chart courtesy of Advanced GET. Data provided by eSignal.

Yesterday's forex analysis mentioned the Dollar Yen is in a squeeze and we are awaiting a breakout. Today we have had that breakout but as always be aware the fakeout possibility. Use our entry stop loss technique to combat this.


Chart courtesy of Advanced GET. Data provided by eSignal.


Good trading.

Forex Analysts
Anne Chapman & Javid Shaik

Waiting for breakout

As mentioned in yesterdays forex analysis we are in a squeeze on the USDJPY and are waiting for a breakout play on this pair.

The trend is clearly up but risk remains to the downside. We have a cluster resistance (based on previous support and fibonacci), trendline resistance, 35 trading bars since the low and MACD divergence.

With the squeeze taking place we could see a breakout in either direction so we need to apply the ESLT when this occurs.


Chart courtesy of Advanced GET. Data provided by eSignal.

Good trading.

Forex Analysts
Javid Shaik & Anne Chapman

Yen Squeeze

The Dollar Yen is coming into a squeeze but more importantly it is at a resistance and the figure today. Price has attempted to break the resistance in the last two trading days but with no joy.

MACD is diverging and Stochastics is overbought showing shorting opportunities. The flip side is the price can continue towards the next resistance level (shown on chart).

A trading opportunity is available but a filter should be used.


Chart courtesy of Advanced GET. Data provided by eSignal.

Forex Analysts
Javid Shaik & Anne Chapman

Bank Holiday Trading

Good morning. Hope you are all enjoying your extended weekend here in the UK.

The bank holiday is normaly quiet as far as trading is concerned on currency so this is a quick update for today.

The Euro as we know has dived over the last two weeks but we are approcaching a support and have a buy signal on a small time frame. This could just be a slight relief for the Euro before a continuation to the downside resumes.

Bernanke and Trichet will both be speaking tomorrow so be aware of this.

Next update will be tomorrow when the markets resume in full flow.

Good trading.

Forex Analysts
Anne Chapman & Javid Shaik

What will NFP bring us?

The forecast is -8ok, last month we had -80k and some financial traders are expecting -100k. Previous month was -63k and prior to that we had -17k. Doesnt look too healthy does it?

Irrespective of what the figure is for this month, it is crystal clear the US is not running on all cylinders. We think the US is in the embryonic stage of a recession. Oil prices are up, Gold is up (recent fall from the figure could be a breather), housing market is not doing too well currently.

So, from the above we should see the USD gain momentum to the downside right? Not necessarily, the USD has spent a lot of it's time in negative territory. We recently hit a 1 month low on the Euro Dollar pair and the sell off could continue towards 1.5350 region. Deal below that and 1.5000 will be the next support zone.

The 4 hour chart below shows a squeeze in progress on the Euro Dollar.



Chart courtesy of Advanced GET. Data provided by eSignal.

Good trading.

Forex Analysts
Javid Shaik & Anne Chapman

Euro Pound Trending Range

After all the news yesterday we have more to look forward to. Aside from that lets have a quick look at a technical set up on a chart.

The Euro Pound cross has been in a trending range since the beginning of this year after it's breakout at the end of last year. We are at an Ellipse and the bottom of the trending range with Stochastics oversold. This is a case of reversal now or a breakdown. We favour the reversal but as usual, we will wait for the market to deal it's hand before deciding the direction of our position.
Should we breakdown here then 7600 could be on the cards but also watch for the fakeout scenario. If we reverse then we could have 8000 in our sights.


Chart courtesy of Advanced GET. Data provided by eSignal.

Good trading.

Forex Analysts
Javid Shaik & Anne Chapman