Saturday, December 31, 2011

Greetings for the New Year 2012!



Megatrade101 wishes to thank all our viewers, friends and most especially to our subscribers here on Blogspot, Twitter, YouTube and on our website. And hope that this 2012 would bring a prosperous New Year to all of you and your Trades! We do appreciate your valuable time with us and that somehow our articles & videos has achieve our aim of providing useful forex insights and analysis to all. Thank you very much!

HAPPY NEW YEAR TO ALL!

Thursday, December 29, 2011

Update: EURGBP Cross & GBPUSD

The end result affecting the EURGBP cross rate have triggered an early technical corrective move higher just within its 21 day MA of 0.8418 after touching a Fibonacci rising Fan support at 61.8%. this coincides with the Euro's divergence created as prices moved lower on a daily basis. For that matter, with the GBPUSD falling to a low 1.5360 initially breaking a trading range support with a slight closing recovery at the 1.5410 1st weekly support level have influenced the initial recovery for the EURGBP cross rate closing at 0.8400. Thus signaling a pause and probable recovery is being set-up for a temporary correction for the coming week. However, we do not discount the probablity of a corrective move at the last trading day of the year as these low prices would meet liquidation with open interest for financial Euro futures. This goes the same for the Euro & the Pound. Please visit our website for a more indepth analysis of this article at http://www.megatrade101.com/  

Forex Trend Following in 2012 - EURO & USD

Without having to report a blow by blow account of the Foreign currency prices, the established trend from this trading year of 2011 would be a clear Trend Following in the opening trading year of 2012. Until such time that both sides of the continent's economies as well as political situations would realistically improve. However, there are mix of signals for an improving US economy somehow, the uncertain of contagion is still in the air as major markets ripples its effects in the global arena.
With the ECB's balance sheet of over 2.73trn , the adverse price reaction of the EURUSD in itself has triggered a massive 200 pips move and a build-up of this momentum towards the end of the year's trading that rippled across the board of the forex market. Although, regardless of these events or a lack of one from a thinly traded market is still a signal that the bias negative and bearish sentiments are present in the market. True enough, easier said when prices has moved; but the overwhelmingly bearish Trend for the European majors and the continuing strength that the USD is making just proves that this would spill over towards the new trading weeks of the coming year 2012. 
EURUSD DAILY

The psychological support of the EURUSD at 1.2880 seemingly looks weak with probable extensions at the 1.2560-1.2680 price levels. When these prices would be achieved would likely be towards the opening trading weeks ahead in January 2012. However, an orderly manner of depreciation would be seen with prices having a wider fluctuation on both directions. A word of caution should be exercised as the Euro prices heads lower; as a technical corrective divergence is being created and stay clear when such build-up of volumes and a lowering of open interest for the Euro futures may serve a temporary corrective price reversal due to position adjustments and year end book-squaring from a thinly traded market condition on the last trading day and opening week of January 2012. And this goes the same with the GBPUSD.
With that said, the correlation with the USDX currently at 80.63as of this writing; would have to go higher and hurdle the first resistance area of 81.38bp towards with its Elliot wave extension targets of 83.30 basis point. And continue just above that extension nearing the major monthly trend line resistance levels of 85.50 basis point on the high.
To date, it would be quite difficult to have projected time-line as to when these technical objectives & price levels can be achieve. This can only be speculated on by viewing the charts through the course of the coming weeks ahead together with the considerable fundamental conditions on both sides of the globe.
For now, Have a great New Year for 2012 and as always only the best for all your trades!

Tuesday, December 20, 2011

Forex Trading: Spot FX Vs. Futures SRO

EURO & USDX - 8+ Strategic Trading Techniques Applied

Most major currency pairs have reached their respective oversold and overbought areas as indicated by both the W% Range and the Relative Strength Index; where it measures the weakness and strength of its prices in a given period of time frame. Video Support: http://youtu.be/2yLP4XE_B3s
This has been the norm of the market prices, thereafter an expected correction to the opposite direction shall be made. The RSI commonly known for its relative strength index as a technical tool, is quite effective, especially where a combination of divergences and convergences are created by the prices from time to time. This is where we could identify two opposing directional lines between the RSI and the prices on the chart either using any of the chart types.
FIG. 1 DAILY EURUSD CHART

In keeping our reports and Market view as simple as possible; the Daily EURUSD shown above is within a Downward Channel since May of 2011 with a few major corrections in October. The point of Price Reversal from both May and October would have the supporting analysis based from the Financial Futures which would not have been reflected above as the equivalent Volumes and Open Interest data are not included unlike the chart of the EURO Futures and USDX in Figures 2 & 3 below. See the comparison and pls. pay close attention to the distinctions also mentioned in our Trading video.
The Japanese candlestick bar is the most reliable tool amongst the other charting systems applied today. Due to its uniqueness in Japanese bar analysis and interpretation as compared with the Western Bar system below in Fig. 2. With these alone, you are actually applying at least a minimum of three to eight (3-8) technical methods of trading analysis. As we do have applied a few tech tools such as the MACD, RSI, VOI, and the 3-line MA Cross over indicators on the chart. A clearer explanation is also mentioned in our video report and analysis. For a complete report pls. visit http://www.megatrade101.com/ and watch our supporting video below.


Forex Trading: Spot FX vs. Futures SRO- EURO & USDX - 8 Strategic Tradin...

Wednesday, December 14, 2011

FOREX: Behavioral Analysis EURO & USD

Fundamental and Technical analysis are just two of the basic forms used to enhance traders skills and improve the ratio of success in trading any market condition. Market Psychology however, plays a significant role in adding a true and meaningful basis in measuring the prevailing real sentiments behind what we all see in the market place even before any extensive reports that affect the prices.
EURUSD MONTHLY CHART
Applied Behavior Analysis
ABA by MEGATRADE101.com
In relation to the current market condition in the Currency Market, it is clear enough that the established trend had started since August of 2011with a corrective move in October for the Euro contrary to the US Dollar in the same period. From time to time, the perception on the market changes due to so many variable factors. A registered high and reversal price at 1.4940 last May 2011 has now completed its 61.8% FIBONACCI retracement levels currently at the 1.2989 and attempting to cover it extensions at the 1.2880 major support levels. The price levels are within the channel unless the extensions would fall below the 1.2880 which again should not be discounted. This may find some form of support with end of the year book-squaring and position adjustments that may also trigger some corrective moves thereafter and a consolidation period. This has been the orderly depreciation for the Euro to this levels without drastically hurting the market and investors. And a counter relief for the US Dollar to recover in a ladder-like manner the same way it did last December of 2009.
The gradual movement for the USDX as its counterpart have shown it wide market swings from both directions, confusing as it may seem but the steadier conditions for the USD to move higher were actually there, of course with some conflicting analysis along the way.
With that said, the price behavior of the USD have indicated these bullish signals so far by cloaking itself to be bearish from time to time. The corresponding low price established for the USDX at 73.45 basis point was indeed in line with the 1.4940 for the Euro. So for now the question as to what would be the objective price that both the USD and the Euro would settle at by the end of the trading year. Therefore, by which measure should we use to answer this question would really depend on the last trading week of the year. But surely, as we have mentioned in our previous market view report that the USDX will be above the 80.00 basis point level.
With so much articles, reports and versions as to why certain movements were made most of the time can be very confusing. That is why we try to minimize such noises in between and see through what is behind such actions even before these reports comes out. And this is where the degree of trading difficulty would depend on arriving at an informed trading decision that would hold true and correct in a specified period of time.
For this particular period of time, where we are nearing the end of the trading year the prevailing market sentiments have been established for sometime. Although, we have been caught in between the TUG of WAR in prices, a not so good economic review from both sides of the continent. And to top it all is the current political division from both the US and the Euro Zone that have influenced global markets and trade.

Wednesday, December 7, 2011

Market Analysis-SRO 1207

EURO-BPOUND-CROSS RATE
The daily configuration of the EURGBP reflects a more positive tone (bullish) from a support price level at 0.8500/10 (S2) and 0.8535/40 (S1) respectively. Prices has held above these levels contrary to the bearish weekly candlestick formation that defines its directional trend lower. However, this is only temporary before it continues its directional trend lower. 
The fundamental actions of a concerted central bank intervention supported these technical price levels equivalent to the 1.3180 EURUSD support which has been defended from further depreciation and the current summit meetings with the EU leaders to really find a resolution for the debt crisis. Thus the Tug of War between the two continents carefully watching the developments that ultimately affects the financial markets and spill over to Asia region. Otherwise, the only remaining concern is whether these rating agencies would downgrade a majority of these other countries as a whole since it has dragging the overall global economy to almost a stand still, so to speak. 
EURGBP DAILY 1207

On the other hand, the resistance levels for the EURGBP cross is at the 0.8660/80 (R1) and 0.8770 (R2) trading range levels. The curent price as of this writing is at 0.8598 slightly above the 21 day MA in line with the EURUSD attempting to drive the prices at its 1st resistance (R1) price of 1.3500. The slightly positive news from the EU zone is supporting this recent action in the European session after the Asian trading Wednesday. Though, this can only mean that a probable corrective move is in the making within a major bearish weekly chart for the cross. And this also holds true for the EURUSD major currency.
The GBPUSD has held its ground reflecting a limited upside for the EURGBP cross, though the potential for such upward correction is seen as of today. A mid-week move higher would not be discounted as trading volumes would appear and book-squaring may start as early has the middle of the month.
A complete report including the AUD-NZD-JPY-CHF analysis is found at http://www.megatrade101.com/

Monday, December 5, 2011

USDx TUG of WAR 2


The concentration of the market is currently focused on the successive meetings with the European leaders in trying to find countless ways to prevent a fallout of the Euro as the ill-effects of the debt crisis still prevails. The market conditions towards the end of the year's trading is critical.
However, after the round of central bank actions, most major participants would and players would have to go back to the drawing board where the technicals would be used to draw key price parameters and where key levels would be identified as such. Namely, the US dollar index still is our main focus. Please take the time to review our previous article before the thanksgiving holiday dated the 21th of November. The key levels to really pay a closer attention would be the the trading support levels at 77.90-78.10 range that should be able to hold.
This is in contrary to the assumed double top daily formation for the US Dollar Index. The correction is quite distinct and recognizable. However, we do not discount the higher bottoms of the 2nd leg. The typical market price reversal made last Oct. 27, 2011 at the 74. 72 should not be discounted with an initial top at 79.70 resistance price levels in line with the Oct. 04, 2011 price of 79.83 basis point. Thus making a visible double top formation on the daily chart formation. This is where the TUG OF WAR between bull and bears would be playing out towards the end and start of the 2012 trading year. Again, the probability of having an across the board recovery in currency value would still have a light at the end of the tunnel where not a lot would really be expecting. This includes the USDX to move higher above the 80.00 basis point eventual objective before the end of the year's trading.
US DOLLAR INDEX ( USDX) as of Dec. 05, 2011