Forex Trend following: Market Analysis EUR-GBP-USDX 1.30

Forex Market Analysis SRO 1.31

EUR-GBP-AUD-USDX

The general sentiments for most investors across the board have started the year 2012 in a good footing. With the stock market increasing in Asia particularly in China including Australia's confidence improving nearing its highest levels prompting the Aussie dollar working above the 1.0610 versus the US Dollar. It has kept it pace moving higher alongside with the NZDUSD at 0.8212 after a daily corrective move yesterday. While the USDJPY expecting some reports today has been performing positively nearing its intervention levels and currently at 76.13.

EURGBP CROSS DAILY

With a more positive tone coming from the Euro zone, the EURUSD have made its daily corrective move moving lower for the start of the trading day with a low at 1.3075 and worked its way back higher to the current 1.3160 as of this writing. In turn, the spill over in the EURGBP cross have also been positive maintaing above its weekly Pivotal price level of 0.8330 from the previous daily price break of 0.8290 registered last January 23, 2012. The daily candle formation from therefrom have showed the tug of war and increase volatility reflected with long wicks with an average HI/LO range of 80-100 pips in between trading & daily session where it would easily trigger stoploss amongst day traders if placed on the wrong side of the trade. The EURGBP cross close relation with the GBPUSD intrinsic behavior with this candle formation and steadier prices tend to move higher with daily negative signals. Currently, at the 0.8380 levels still within the rising channel would contiue to be above these levels towards the North American trading session. Likewise, it would maintain prices as long as the Euro moves steady with the GBPUSD making its corrective daily move moving higher behind the EURUSD. 

Please continue ... http://www.megatrade101.com/

Inverted Hammer confirms uptrend!

Technical Applications: A Rising Channel, Fibonacci 3 methods, W% Range, Momentum

EURGBP DAILY

In relation with the EURGBP cross, while we mentioned that the pivotal price of 0.8290 is a key level and any price above the 0.8350 will likewise be bullish for the cross in line with a continuing rally for the Euro base on any positive news in Europe. In the Jan 19 market view R1 is at 0.8360, R2 at 0.8441 levels which may meet some pullbacks on a daily session but the extensions would reach its FIB retracement levels of 23.6% and a cross-over on the FIB Fan resistance levels of 50%.

Thus making a probable correction can be made when it registers this prices on the way up. In addition, the equidistant channel resistance and extensions would be the next level where we would find the 0.8441 R2. with the daily technical chart would likewise reach the overbought levels of the Relative strength index. Please refer to market view January 18

The weekly EURGBP cross chart below from the previous week ending the 13th of January shows this signal set-up for the correction. As the inverted candlestick ' Hammer' bar represents that signal, however it is only viewing the weekly formation that its can be identified.

EURGBP WEEKLY

USDX further decline - a Major Corrective move

USDX WEEKLY

The FOMC dovish report has placed the USD under similar pressure that resulted in moving back lower below the 80.00 basis levels. Sentiments and commitment by the Fed members in keeping rates at its low levels for an extended period of time has been quite definitive. Investor's concern on inflationary pressures are seen even on the movement of the yellow metal as it moves higher for the week at the levels of USD 1728.00 per troy oz. That resulted to the USDX registering a 79.10 slightly above the more important 78.85 bp technical support.

Moreover, the technical perspective for the USDX have been established as a major corrective bearish move within a major uptrend. Recognizing the initial topping out formation in line with two of the major currency pairs in addition with the correlated cross rates, have signified that such a significant corrective move would extend further than most would actually expect.The USDX candlestick chart in Fig.1 shows that the continuation of a decline with daily pullbacks would be seen moving forward as the Tug of war between major players are in play. These movements were seen accordingly for the past couple of days with the Euro, Japanese Yen and the EURGBP cross in particular. Continuing analysis and chart... http://www.megatrade101.com/

Market Analysis for week 1.23

The highlights would weigh more on investors risk appetite and market sentiments on the US Dollar that would likewise be based on the coming 4th qtr. GDP report or even a mere hint of the Federal Reserve QE3 may really be a game changer for the Forex market.

EURUSD 01.23

The recent relief rally of the EURUSD last week from an impending debt crisis has dissipated for now until such time a more definitive answer for a solution is made. And this may find some pressure for the USD to continue its trend higher for the time being as evidence from its corrective downtrend. The higher opening price has provided room for the correction to continue in the European session.

However, after registering an 81.78bp high, the USDX has drifted lower to 80.00 and is confined to its lower support at 80.31 as of this writing. The critical price to watch for would be the 78.85-80.05 trading range and the shift in market sentiments are the key considerations moving forward.

Meanwhile, the Euro has enjoyed for now the decline of the USD in lieu of the dissiminating reports from the Euro zone. It is currently at the 1.2931 in the European opening showing signs of relief alongside the EURGBP cross rate still above its pivotal price at 0.8329 that a 2nd attempt is being set-up. Do expect a wider swing at the start of the trading week with some daily pullbacks from the daily highs. The earlier signs of this corrective move higher were ever present even before when the opening price gap occurred for the second time on January 15, 2012. Again, two considerations could be interpreted as an exhaustion gap or a second attempt for a run away which obviously didn't occur the following couple of trading days.
Please take note that the price behavior would never show when exactly such a price reversal would occur but can provide the insights only for those who has the due diligence of carefully studying the market from a series of events taking place and not merely on a per set-up basis. That is also why MegaTrade101 form of market analysis presentation is based on a continuing market condition as they occur quite different from others.

The complete report including AUDUSD & CHFJPY CROSS analysis at http://www.megatrade101.com/

HOW CAN WE BEST HELP YOU TRADE FOREX

KUNG HEI FAT CHOI

In celebrating the Chinese'Water Dragon' New Year 2012, MegaTrade101 would like to share its Forex Trading experience and strategy solutions to any degree of trading difficulty by sending us your questions or trading experience in the forex market through our contact tab or email us at info@megatrade101.com  

JS T Alexander will directly answer your trading questions via email. And likewise, MegaTrade101 will assess the market conditions on

...HOW WE CAN BEST HELP YOU TRADE THE FX MARKET with confidence!...

This will be for a limited period until the end of January 2012. All emails will be answered accordingly to the dates it will be received. All emails will be handled with strictest confidentiality and would not be made public. Please be patient with each response Thank you!
ONLY THE BEST FOR YOUR TRADES!

Disclaimer: No Guarantees or promises are made / claimed herein; as the Forex Market carries a high degree of risk and Loss of trading capital can equally occur.

Mid-week Analysis 1.18

EUR-GBP-USDX
The end-result of the report by the IMF to increase the lending capabilities to USD1Trillion have indeed made a difference in initially halting the bearish price action for the Euro. There were some heavy offers in the European trade before the news and some have reluctantly withdrew when the reports came out. Thus resulting to a corrective price movement higher for the EURUSD pulling back to the 1.2810/20 and is currently threatening the 1st resistance price level of 1.2880 in this couple of days trading activity.

EURUSD DAILY

Increased volume activity from profit-taking activities from earlier shorts added to the relief rally for the EURUSD and an equivalent decline for interest with the USDX which prompted the USDX to pull back lower to 80.48 as of this writing. However, on the technical stand point; this is a normal corrective action within an established trend. Remember, that current prices are within the major channel trend for the currency majors and any such correction may be seen as temporary, although with a significant price difference between the OHLC prices as well as a wider fluctuation on both directions before the end of each trading week.

While both currency pairs; EURUSD and GBPUSD are well within its bear trend the current price levels are slightly above their 21Day-MA, 1.2830 for the EURUSD and 1.5450 for the GBPUSD respectively. And this is accompanied by an increase in volume activity and interest. Besides, on the Asian opening at the start of the trading week, the 2nd price gap opening shown in the EURUSD daily price chart has indicated another attempt of an exhaustion and/or a run-away. On the contrary, the next couple of days trading showed a failure of a possible run-down of the prices which meant that a correction is probable than a possibility. And adding to this sentiment is the daily spinning top / candlestick bar for the GBPUSD. Likewise, the EURGBP cross weekly chart formation showing an inverted hammer; as another signal for a probable corrective movement was expected against all odds of a bear market sentiment. And these signals were indicated in our previous market view report dated the 16th of January 2012.

The extreme hysteria of the Euro market condition previously have already been adjusted by these recent corrective actions making the trading HI/LO price band wider and difficult to speculate as to when a turn around would occur for the continuation of the major trend. However, there would be limited speculative and bias offers near the 1.2880 that may be triggered in anticipation of a price reversal back to the downtrend. For now, the market's price behavior is apparently in a corrective phase with price directions moving wider this coming weeks.

As for the EURGBP cross, this price action has supported the contrary bear price movement from the low of 0.8250-a higher-low bottom level and at 0.8290-a pivotal price level that would fuel a bullish price action whenever the price settles above the 0.8390-0.8410 closing price range for the week. The current price for the EURGBP is at 0.8330 as of this writing. The continuation of the directional trend would be dependent upon the influence of the price action of the EURO and the US Dollar that would be taking the center stage of this market. Pls. refer to our website for a complete chart presentation at http://www.megatrade101.com/

S&P Downgrade vs. FX Tech. / Fund. Analysis

Fundamental:

With Standard & Poor’s downgraded the sovereign credit ratings of major 9 Euro Zone countries, in effect sent the Euro further down towards the closing market last Friday. Although, with the limited time left; with Monday being a Martin Luther King holiday, some traders had been pricing in such a possibility.

But a spill over for this short trading week would accelerate trading volatility, as expected for the third trading week of January. The credit rating's downgrade have coincide with our market outlook where the USDX rally would continue its advance. This would be the fuel to trigger this expected rally.

The net effect of negative stocks in the Asian markets have been seen today that may well seen over in the European market. But European leaders have been quick on their responsive statements addressing the structural reform needed to stabilize the crisis including a call to create a European credit rating agencies independent from the US. How this Tug of war have continued has not helped the market one bit. On the brighter side, investors shifting to a more flight to quality investments for the USD have been more favorable now compared from a few months back.

In a recent release by the US Commodity Futures Trading Commission (CFTC)showed that net Non-Commercial futures traders—typically large speculators—were the most net-short Euro against the US Dollar.A clear slow buildup of volumes and open interest for US Dollar bulls will be increasing with wide spread European investors hedging their portfolio and shifting cash flow investments from EURO/Gold denominated assets.

Technical:

The US Dollar largely expected to gain further with the USDX touching a new 81.60 basis pt. high will have to accelerate once the US financial futures open with Globex and ICE leading the initial trading after the MLK holiday. The next target objective for the USDX is at the 82.05/10 which could be achieve within the opening week. Trading activity on Tuesday-Wednesday trading session would be dictated by the US Dollar taking the lead with trading volumes in Asia and the European markets.....

For a complete report visit http://www.megatrade101.com/

Forex Trend Following continues...2

In between the reports, the currency majors were at pause while waiting for the next batch towards the end of the week. However,on the fundamental side of the equation; the recent Fed’s Beige Book statements indeed offered a more positive assessment of how the overall Federal Reserve report were widely interpreted.

By stating that US growth was, “modest to moderate” across most of the US states. while manufacturing maintained its expansion. The statement were more or less in line with the recent data and continued to imply that the US domestic recovery remains on track. And with that said, these statements have supported the technical charts for the major pairs.

On the other hand, the USDX again continued its advance after coming from a temporary correction with a low at 80.80 and rebounded back to the 81.50 levels and currently at 81.23 as of this writing. The US dollar advance by at least 1.05% against the British pound. While adding the Weaker than expected trade balance data out of the UK added to the downward pressure for the sterling / pound falling to a low 1.5305/10 range. And likewise awaiting ahead for the BoE interest rate decision expected to remain the same. A further downward pressure would open extensions at 1.5180 as the 2nd objective in line with the USDX higher than the previous established resistance at 82.05/10 basis point.

For a complete analysis, click on link
http://megatrade101.com/megatrade101/market-view

Forex prices stalls..

A Classic example of the currency market that stalls after a wide daily price move.

For a better understanding let us review the most recent market action in comparison with price alignments of the USDX.

After achieving its objective above the 81.10 with a high at 81.45 bp; with the USDCHF at 0.9550 and the EURUSD's opening price extension levels at the 1.2660/80, this combined price adjustment has made it possible for a daily corrective move for the 2nd trading week for January.This is also discussed in our recent educational Forex article on 'Market Timing in FX Trading' article below. 

The corrective move for the EURUSD at 1.2818 was an initial attempt for the start of the week where the 1st resistance price of 1.2880 will be tested as the current price level serves as a wide spread price differential from its 21 day MA of 1.2930. Currently the EURUSD is at 1.2737 pullback price from its high and relatively feeling the pressure for its weakness has caused the same price swing with the EURGBP from a high at 0.8286 and is at 0.8240 as of this writing. A contrary swing would not be discounted as net overly bias-bearish positions outweigh long outstanding positions versus the GBPUSD currency pair. Thus pushing the pressure favorable for shorts in the EURGBP cross rate within the mid-term downward trend.

A Tight range and lackluster trading across the board in forex market have lessened the activity as it comes mid-week in between the US Dec Retail sales, ECB rate decision and the University of Michigan Confidence figures.

Meanwhile, the AUDUSD & Kiwi has maintained their current status as currency leaders along side with the continued strength of the Japanese Yen. Although,traders and investors reluctance to take any further speculative positions with the Yen and the USDCHF is due to the probability of intervention by central banks and moreover the Euro's price vulnerability from the current meetings in Europe by Sarkozy & Merkel to finally try to resolve the crisis.

Market Timing in Forex Trading - MegaTrade101

This has always been the case for most traders and strategist whenever trading the Foreign Exchange Market. It would be nice to share some of the successful trades made specially these current market conditions. As they would be very useful for some who may be starting to feel how the FX market really moves when major economic numbers are released. However, there are a lot of worldwide reports to consider within a given period of time and to be able to cover all of them would be quite demanding for a trader.

As correlation in the currency market in particular are as important to every trade position marked in the market. The degree of trading difficulty is ever increasing by the day as uncertainty and unpredictability of wider price fluctuation will always be present. But in recent market conditions, the most impressive price reaction is a currency who has made a dramatic price movement either way and stalls.

This is when traders are contradicting either a follow through or a pullback would be made causing the trader's reluctance and patience to be tested. This also applies to those who are too eager or for those who happens to wait for a confirmation of a price break/confirmation signal. If this were true to the fact, then everyone would be considered a winner.

But the total opposite does happen and the next question would be ...where did I go wrong?

In the Foreign Exchange market, to improve market timing would really depend in developing a keen eye in spotting trade set-ups combined with identifying market behavioral patterns for each currency related trade, focused only on entry & exit price range. Naturally, this would only follow once a strategic trade plan has been established. A certain degree of elimination and process of deduction would always be in place before any trade execution is made. And that is being able to draw an informed and reasonable decision from the due diligence whether such trade plan is worth the risk/reward ratio given a specific period of time exposure in the market.

It is quite easy to enter into a trade at any given time especially if and when the market has enticed the trader to get into a trade by impulse. What is equally important is getting out of the trade alive with at least a fairly good gain. But there are some traders, even seasoned ones who tries to catch the market action in either direction and subsequently would place an order to trade feeling not to be left out for a chance and an opportunity of riding with the market sentiments.
For the complete article including the process of developing 'MARKET TIMING in FOREX TRADING' visit our website: http://megatrade101.com/megatrade101/fxminar 

• In addition, please refer to MEGATRADE101 - STRATEGIC FX TRADING TECHNIQUES

Asia Opens with a 'Trading Price Gap'

Although, the American trading session on the NFP and Jobs figures were the catalyst for fueling the USD rally; the Asian opening trading have resulted with price gaps particularly for the EURUSD, USDCHF, USDJPY and a couple of crosses the likes of GBPJPY including the EURGBP. The USDX is no exemption as this would tapper-off some daily gains from the previous closing last Friday. However, defining an exhaustion or continuation price gaps would depend on the succeeding and sustaining price action in the next few trading days. The highlights of last week's figures would continue to dominate investors sentiments that would push a favorable rally for the USD after its correction.

EURUSD DAILY

Daily corrective pullbacks are expected in-between trading sessions. The backdrop of market sentiments between the US and the European markets would still remain subdued and negative bias for the Euro until such time in the 1st quarter of the year. As for the EURUSD touching its initial support extensions at 1.2660/80 whereas, the normal 1st reaction for a self-corrective price to go higher is being set-up at the Asian opening towards the European trading sessions. This goes the same with the EURGBP cross and the GBPUSD. Meanwhile, North American traders would wait-it-out for further price action before making any market move at the start of the week where an expected spill over from last week's USD rally would pick-up. For a complete trading report and charting analysis including the USDCHF pair, please visit our website at:  http://www.megatrade11.com/

Moving forward, we do expect increase trading volatility and market action towards the 3rd trading week of this month. The continuation of the rally would have to start building-up after such corrective move along side the European majors. Foreseen to be short lived would really depend on the follow through volumes of market sentiments by major institutions. As retail speculative trades will always be out-paced by major forex hedgers and speculative institutional bank players in terms of volume transactions. 

NFP fuels USDX rally

With the completed correction for the US Dollar, measured by the USDX the initial target objective above the 81.10 basis point. This was indeed supported with the better than expected Non-Farm Payrolls & unemployment figures of 200k showing US jobs and economy improving than most have expected. Since investors on both sides of the continents have been so used to the negative reports may have been so reluctant to at least have a positive outlook did had been waiting for some actual facts before accepting the fact that things do change for the better after a worst case scenario.

USDCHF Rallies with USDX

Although, one thing needs to be considered that a certain price action and market play would never show the next best move and could simply through off the trade set-ups by misguiding price fluctuations before the news today. This is where technical figures have been supported by the fundamentals even before it happened. Where the USDX rallied to its best performance thus far along side with the USDCHF achieving its 1st resistance objective at 0.9550 and the GBPUSD at the 1.5350/75 range support. Pullbacks towards the closing for the week would be expected and wouldl justify the 2nd leg higher for the US dollar has been confirmed with the NFP report. As spill over for the coming week would depend on increase volume and volatility as we start the trading weeks ahead with vigor amongst the institutional players hereunto. 

Trend Continues, as correction concludes 1st phase

USDCHF DAILY as of 010512

The continuation of the rally for the USD can be seen as it is moving higher with a more influential force on the Swiss Franc or USDCHF working at the present price back to 0.9498. Its attempting to reach its initial target at the 0.9550 (R1) with a possible extension nearing the 0.9650 (R2) - 0.9720/50 (R3).

However, there would be no straight directional moves as volume and volatility would only build up towards the third trading week of January. Daily pullbacks for the USDCHF are expected nearing the 1st resistance levels with some price adjustments between the USDJPY as it moves contrary with each other. As the Japanese Yen moves closer to its intervention levels some speculative moves are expected. We would stay clear of the USDJPY and instead work with a cross related trade this coming weeks ahead with the EURGBP pairs, USDCHF and the Aussie.

We are expecting a continuation of a rally for the USD that would occur in the Asian session towards the European market for that particular time period as some major players may soon start building fresh positions for the year. As the 1st corrective phase before the actual rally takes place have been completed. We should be able to pay a closer attention as to volume build-up and open interest for financial futures; as this would set the pace for hedgers and institutions to play with the market before the end of the fist month's trading period ends. Keep track of the reports and price behavior as volatility would increase, so does price fluctuations on both sides would occur.

GBP-EUR-JPY-AUD-NZD Currency Leaders

Not necessarily in this order!

The start of the trading week has taken off with the expected corrective moves anticipated by way of the closing prices and behavioral movements of market since the opening of the US trading sessions. Although, the backdrop of the sentiments still remains bearish for the Euro in general the actual session highs for the European majors has been quite friendly for the bulls anticipating a correction. 

The EURUSD and the GBPUSD has performed well during the mid-week transition towards a full trading activity for the week. Reaching an initial high as of this writing at 1.3067 and 1.5650 respectively for both currency pairs after the USDX made its corrective move lower at the 79.60 basis point. This apparently coincides with the precious metals recovery back to USD1606.95/oz price levels from an established low at 1522.48 and oil back to the 102.24 price levels.

AUDUSD DAILY

Considering the market across the board, the Aussie and the Kiwi rallied to the 1.0370 and 0.7903 high respectively. The first trend line resistance levels for the Aussie is at the 1.0450/80 range and would meet some pullbacks on a day to day price movement. While the Kiwi may find legs to continue the rally alongside with the rest of the Asian currencies showing resiliency with the USD and gold movements. The trend line resistance for the NZDUSD above the 0.7790/00 has been penetrated while its maintains its prices just above the 0.7800 levels. However, any first trend line breakout may have a couple of daily pullbacks as it gathers pace to continue if and when the USDX goes back to the corrective price of 78.85 - 79.05basis point.

A complete mid-week report would be posted on our website at http://www.megatrade101.com/

Announcement: Ad Spaces available for 2012 on MegaTrade101.com Email us : info@megatrade101.com