Insight: #EURO @Greater Risk with #CABLE

China's move in cutting their reserve ratio prompted Chinese stocks moved lower influencing Asia markets to do the same. With the exception for the US market that is slightly in positive territory as of this writing. 

Euro zone inflation reports were negative than expectations with the EURUSD moving ever lower from the reports @1.0872 low that would lead ECB to further consider easing in March. Nearing the opening of the month, the Euro indeed retested the 1.0880  while resting at the lower band of its range. Its correlation with the EURGBP Cross would be a viable Cross trade strategy that meets the current market condition as an alternative pair with the most market potential. 

The tech side of the chart remains in negative tone along side CABLE prices that has further downside potential which would take some time to fully recover, as mentioned in our most recent market view. Although, a probable rise may also be reasonable as indicated in its overall picture, but would only be short-lived through their daily session trades.

CCY Corner: DXY CABLE EURGBP Correlation

The upward US GDP revision provided the lift for the USD closing higher and above @98.00 bp levels. The recent surge was seen as half-way through the previous decline from 100.21 high to the 95.23 low and recovered to its present price level @98.08. And the benchmark low of 95.05 – 95.23 low range is now considered to be the primary support for the USD-DXY.(cloud-chart) Note: Corrections made

CCY Corner: DXY CABLE EURGBP Correlation

Market at a Glance!

Market disruptions are trying to gain some footing in the market, as investors have been accustomed to central bank policy makers when it comes to interest rates and inflationary pressures that affects prices directly. On the other hand, with volatility abound market sensitivity will still prevail as the widened price range can continue.

In some point in time there would be a disconnect from having a too close of a relationship between stocks and oil prices. Apparently, with Walmart earnings affecting retailers has already overshadowed this scenario. This is what the market is focused on at the moment aside from the fact that a global slowdown in developed and emerging markets crossed the wires can possibly derail the recent rally. Will just have to wait for the market's reaction at the end of the closing week this Friday.  

Market Insight to Trends & Price Behavior

The normal behavior from a price alignment coming from a massive decline for the past month and half since the opening of the new trading year. Based simply on the last few weeks heading towards the new month of February, it had taken another linear cycle that prompted us to consider the probability of a pause and a pullback after the declines. 

And true enough, what the market has reflected over the past several days of gaining lost ground have proven to be correct. The question of sustainability persists given the fact that the price pullbacks in the currency and commodities market alone have started across the mainstream trading activity. This is a review of the four major trading market categories mentioned above. Click Link to continue

Market Insight to Trends & Price Behavior

The LAW OF TOTAL PROBABILITY ll

At times the Law of Probability do apply, knowing 'how to' is equally as important as to knowing 'when to' use the application in certain market conditions.

Being able to fundamentally relate marginal and conditional probabilities are essential to the equation; as market conditions changes at the same time that prices do. The process to achieve a higher degree of projected price accuracy comes by adding the next three methods to find where the price levels would be heading at. This is where going beyond charting and price action analysis goes hand in hand with market behavior.

This method only applies at certain market conditions where the we have found one of two applicable trade set-ups  on the decline and a cross rate still in the making. A clear example was the JPN225 @14770 and the USDJPY @110.97 on the massive decline. Where a price alignment have been identified which we have anticipated a reasonable correction currently reflected by the recent price recovery.


Refer to Link: Price Alignment Validated on Decline

Price Alignment Validated on Decline

USD Align With Market Decline

"The probability of returning market volatility after the China market holiday will be in focus as a similar trading scenario could occur upon opening of trading. A probable mirror image of new price cycle with new highs / lows & trend direction is anticipated after the USD Index (DXY) marked a new low @96.25. basis point"... Dated Feb 08, 2016

The Law of Total Probability at times do apply, its knowing how to is equally important!

The relative extension of the USD @95.23 low which fell short of its price objective @95.05; and was traded in two separate occasion. Which had pushed the boundaries for speculative positions out, as the effects of a pullback was eminently proven with the EURUSD, EURGBP and the USDJPY. As stated, the price alignment came through a massive decline across the board which have indicated that a reasonable pause or pullback would occur. Hence, that is what the market has offered on the early trading today.

As we have seen the JPN225 and the Hang Seng (HSI) indeed made a strong come back for the day's trading. As China's holiday proved to be a relief and this is what we meant stating that a mirror-image of the decline would eventually come as soon as China resumes their normal trading sessions.

JPN225

Japan's contraction and a price recovery by the JPN225 allowed the the USD (DXY) to open with a similar GAP pattern which supported an initial lift and a contrary price decline for the EURO & its cross rate. Yes, its after the fact, however the timing couldn't have been more appropriate as the price behavior and action reflected the trade set-up prior to today's session. Most instruments have already marked their respective caps and bottom price levels and expect a wider trading range, incremental during daily sessions yet adding it all up by each week ending can be substantial.

Related Video a Must See: How to measure up a price change or a rebound from a decline

Global Stocks Tsunami - Asian Trading Session as of 02.12.16

JPN225 Asian Trading Session
as of 02.12.16

@megatrade101- PRICE ALERT: watch & learn - Global Stocks Tsunami Brings Yen Repatriation Back as JPN225 trade Update: @14770 low in Asian session. 

Take away:
In addition Japan Finance Minister Taro Aso watching Yen's rapid appreciation that hinders BOJ monetary policy. Cautiously watch as we all have learned from previous experience that BOJ manages to pull some stops when it is most unexpected by the market.  And this is due to the fact that verbal intervention may have proven to be soft after coming from a holiday schedule.

Alternative CCY Hedge Strategy ETFs

ETFs v. USD weakness v. JPY strength are the right combination for this bear market, with the expected follow-through. The Effective Price Action Analysis & Market behavior are still in place as hysteria is boiling across the major global markets.

Making the right choices of instruments which are correlated that provides wealth preservation while building additional equity and staying liquid with assets well protected by an excellent strategy that serves as a layer of cushion in exceptional trading times.

A CIPHER3 Method Applied

 

INSIGHT: FX & Stock Indices Price Action

Marked Highs & Lows: The market's ability to set newer highs and lows is widely credited to the momentum and volatility of price action from a broad base combination of the US Dollar, the DOW JONES, SP500 & the JP NIKKEI 225 index and their respective correlated markets with OIL

The sequence of price movements on the USD; as defined with its trade weighted average DXY, which marked a new low @95.65 setting the market pace for the currency market to do the same. This already stated with the new low on the USDJPY @114.20. These initial moves were the first signal that a new cycle of alternating moves were in the making which we have anticipated in our most recent report. Let us define the series of price movement in their order and price sequence reaction.

INSIGHT: FX & Stock Indices Price Action

New Price Cycle Starts on CCY & STOCKS

USDJPY 

PRICE ALERT: 

• USDJPY @110.95 - 2nd NEW LOW European Trading Session Update as of Feb 11, 2016
• USDJPY @114.44 - 1st NEW LOW Asian Trading Session Update as of Feb 09, 2016

Based on our most recent expectation the market is geared in setting-up "New Highs & Lows" which have started as early as today trading in the US trading session. Admittedly, the market has gotten ahead as of today's price action highs & Lows. How short-lived a price recovery was that! 

Nevertheless, after the DXY @96.25 low; an initial contrary price move by the USDJPY that marked a new price low @115.17 - extension - (Higher Value) as of writing. This also reflected the flow of sentiments where a spill-over from the stock market's decline have also shown investors flight to safe-haven currency pairs. Related info on DXY Price Alignment

With similar bets shifting towards the precious metals on GOLD near @1200.00 New High Levels away from a renewed price decline on Oil. And other sectors from Technology, Financials other than Energy have been the main drivers of the decline: while the market awaits FED chair Janet Yellen's testimony for the week.

Its been quite a busy session again from the closing of the European session, as price action on the EURGBP cross has set its 2nd New High @0.7760 which may find some minor resistance while CABLE gathers momentum for the next leg lower as we have anticipated. However, these three currency pairs have also been the main focus as the market have been active since the opening bell. For now this is what we meant as the market has gotten ahead this time around.
       

Opening Price Gap

USD INDEX

The week long Lunar holiday will provide some breathing room for some investors for the stock market.  The week's mild US reports within a thinly traded market will be an opportune time for the USD price recovery along with its counterparts which already opened with a gap from their closing prices.  

The probability of returning market volatility after the China market holiday will be in focus as a similar trading scenario could occur upon opening of trading. A mirror image of  new price cycle of new highs / lows & trend direction is anticipated  to set the pace after the USD Index (DXY) marked a new low @96.25. basis point. Alternating currency moves after this week's US  data will clear uncertainty. New trade-set-ups would provide a better glimpse of the majors as it resumes normality in trading activity. 

Opening Price GAP

Behind the USD Decline Update - What's Next?

US DOLLAR INDEX (DXY)
As of 2.05.16

The market's volatility has kept investors, traders and analysts on their toes has price swings have been fixated on stocks and oil market price swings. Nonetheless, the FED's remarks on global uncertainty was the main catalyst that triggered the initial decline which was followed through with enough momentum for the USD to set a "NEW LOW" @96.25 as of the closing week of Feb. 05, 2016.

It is a fair assessment that the registered high of 2015 for the US Dollar Index (DXY) is well in place. Unless a renewed confidence would be clear to the market for a continuing rate increase; this price level would be the benchmark for the high on the USD. Although, a slight increase of 53% reported last Friday can well be sustained if and whenever the FED would do so in their next three meetings. Then the continued strength of the USD may likewise add pressure to the US economy.

Market Insight: Behind the Move - What's Next? Page 2 Update

RESPECTING MARKET VOLATILITY

"The Presence of Market Volatility Should Always Be Respected as it Happens & Be Willing to Adapt with its Extreme Price Swings"

The Benefits of a Professional Mentor & Veteran Trading Partner 

Sir Alexander of MegaTrade101 actively traded as an 'Independent Investor / Private Fund Manager" in the Commodity Futures, Foreign Exchange and the Equities markets including Global Indices & ETFs with reputable Institutional brokers only and with several 'Private Banking Relations' - Interbank levels from Asia, London and the US.

An Independent Consultant / Chief Investment Strategist for Asian & US based Private Equity Investment firms. Over the years, managed a combined 10 figure portfolio under management from 1989 to 2010. Prior to a semi heading towards a full retirement, is still actively responsible for training next in line client's trading account managers that would provide a higher level of trading experience moving forward. Fiduciary Duty to our clients is top priority with 'No Conflict of Interest' since there are no foreign / local affiliations and representations. 

Private Banking Relations: HSBC - Standard Chartered Bank - American Express - CitiBank - Barclay's Bank - Saxo Bank - Bank of Singapore - ANZBank

Let the market pick up the slack for MegaTrade101 Client / Investors training; while building trading confidence & consistently timing trade execution accurately more often than not! There are no training workshops alike, as we have overcome these markets for so many years. Therefore, we must be doing something right!

Investors Reacts to USD Decline

 Correction Validated 
DXY As of 2.04.16

Navigating Through Market Volatility:  The USD (DXY) is setting a new low @96.63 basis point, and the direct effect were reflected  with the EURUSD as it broke above its daily price consolidation levels @1.0880 and is currently @1.1180 as of writing. This can be attributed to the FED comments, which some traders see a more speculative reaction which can be considered overdone due to a rapid price decline.

Meanwhile, CABLE is barely keeping pace with the EURO with an exception that it registered a soft high @1.4665  as it's price move is limited due to mix fundamentals on the BREXIT floating in the market. And the same mild reaction is reflected with the EURGBP cross which has not made any serious attempt @0.7755 high which serves as the near term price resistance. The only time it would do so is whenever a probable corrective move for CABLE occurs as market volatility shifts with volume and investors flows in /out of stocks. CABLE attempts its range @1.4750 - 1.4830 which would be supported with enough momentum and volumes unless new fundamentals develops.

Correction in the making 
DXY As of 12.16.15

This is the 1st signal of the chart pattern of US Dollar as of 12.16.15 which is now being validated with two consecutive days of price declines. Although, the signals were there the overall picture remains intact but as we always say there will always be a major correction within a major trend.

Considering the decline is more fundamentally motivated the high from 2015 serves as the new high, while the current low @96.63 is being set as the fresh new low. The market insight here is the "Alternating Currency" moves which reverted back to the US Dollar along side the price recovery of OIL and GOLD.

This strategy applies when market shifts are in-front just waiting to be recognize. This USD decline is well respected where the financial USD (DXH16) & EURO (E6H16) Futures March 2016 contracts were properly utilized during the daily price consolidation period. Taking a cue from market volatility and other markets accessible for trading. Navigating SPOT / FUTURES Markets can best be managed knowing the CORRELATION of trading instruments accessible to tactical investors with self-directed accounts.  

Corrections on the date & Label were made on the charts. Thank you!

Best Reference Video: Forex Trading SPOT vs. FUTURES 

CORRELATION in the PRESENCE of VOLATILITY

To be effectively trading in the presence of market volatility, knowing how important it is in calculating or having a "Correlation Table" for each currency pairs being traded is a must have. Because currencies are priced in pairs, so no single pair trades completely independent of the other. However, not merely knowing how positive a high or negative low value is between the currency pairs but by going through the extra mile of selecting an alternative pair either a major pair or equivalent cross rate that can best be suited for certain market conditions is indeed a process.

That is also why, the first step in the process of trading the currency market, traders do require to have two or more currency related pairs to have an effective and successful trade during a volatile market. As the process only begins with one and are subjected to alternatives and ensure a layer of cushion in the event that such trades are not timely executed. These correlations do change over a period of time, which can be used to properly manage the overall portfolio amount of exposure in the market.

Thus, providing significant advantages for a tactical investor / trader that uses these information while trading related currency pairs that would move in a similar direction or counter trend direction. When such pairs do move in opposite direction, it can mean that certain external forces, normally fundamental factors and risk events may be driving these movements. And the increase in market volatility exists whenever price swings in both directions occur more often even within a near to short term sessions.

On the currency side whenever these conditions occur especially with a dramatic price change on the USDJPY and its correlated Yen crosses like the GBPJPY. And similar price action relative with the EURO, CABLE and the USD direction changed after reports from certain FED comments came unexpectedly. Thus moving the USD lower @96.20 low during the US trading session

COMPARATIVE INSIGHT #DJIA #PSEI #USDPHP

ATTENTION US - ASIAN INVESTORS & TRADERS

Taking a cue from market volatility with the @DOW and #SP500 price benchmark levels from our previous analysis, the #PSEI relief recovery from last week has now started to resume its downward trajectory.

The recent attempt towards the 6800-7000 range likewise were not a convincing rally which fizzled out as more foreign outflows weigh in the market. A similar case scenario have been building up even if the data on the Philippine GDP were in line with expectations; it was not enough to make a significant change in market sentiments to global slowdown on Asia Pacific economy.

The USDPHP after several weakness move heading slightly above 48.00 have gained some footing @47.50 levels while a resumption of its weakness can again be seen especially tied to the stock performance of the PSE Index. A closing below the 6500 levels will be still in negative territory heading towards the election season that may prove to weigh into the market. And any price recovery would be considered short-term. Consider looking @EPHE as a reference other than the traditional way looking @PSEI while comparing it with the @DOW Jones Industrial Average

Thus US-Asian investors would be well positioned to take advantage of related US markets that would offset overall negative value in PH stocks in their portfolio. The volume and liquidity of other markets relative to these moves are accessible knowing how to is a matter of due diligence and deriving a positive trading decision from a prism of market perspective analysis.

#DOW #SP500 #USD #JPN225 Resumes Declines

" Its been a quiet session for the start of the week as the figures last Friday would again be anticipated to be bearish for the USD in the near term contrary to the major uptrend that it is. And when fundamentals warrants a probable decline we would not be surprise to see a resumption of the decline. Overall market sentiments are still bearish for stocks and oil prices as reflected in today's price movements."

These levels on the DOW @16800 - 17000; S&P500 @1950 -2000 JPN225 @18080 - 18400 are the key prices that would make any difference in market outlook. The attempts were made from the upsurge but not as convincing as we have mentioned that the resumption we're seeing now is definitely not a surprise for the market to do. As USOIL have resumed its decline as indicated in the chart below.

LINK USOIL

 dwq4do82y8xi7.cloudfront.net/x/RQAUlWi2/

A Matter of Perspective Analysis ll

Applying 2 Leonardo's Theory
on Fibonacci Measurement plus
Sokyu Honman's Candlestick
Interpretation 

Interpreting a price pullback either coming from a decline or a rally still has two sides of the coin to be looked at. And that is how we view the recent price action that occurred from the stocks and currency markets.

This is in connection with our correlated information shared on the Aftermath of Market Volatility and A Matter of Perspective Analysis. There will always be two angles to view the next probable direction that would take place. But it all boils down to how one interprets it and be inclined to believe.

The rapid price change or similar pullbacks across the markets in general were considered to be a relief recovery from a battered stock market decline and with similar reaction from declining Oil prices. Once floating talks would appear in the market on production cuts from OPEC & Russia may tend to replicate an artificial market reaction that might for some reason can be a game changer.

With that said, on the currency side whenever these conditions occur especially with a dramatic price change on the USDJPY and its correlated Yen crosses it would be wise to consider how far such rebound can be sustained. The USD direction nearing the triple digit figure may provide a glimpse of reality either staying above these higher levels or simply closing lower by the end of a new trading week which should not be discounted from certain market comments when it arises unexpectedly.

This information would be quite useful: