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Technical & Behavioral Perspective: EURJPY

2012-02-08T06:27:00.000-08:00

EURJPY CROSS DAILY CHART

UPDATE : As of Feb 09- Expect increase volatility, follow-through price action and pullbacks in the next 2 trading days especially the trading sessions in European market towards the US American trading sessions on Friday for both majors & cross rates respectively!
The EURJPY candle configuration is quite interesting then prior to today's upward direction as fueled by the surge on the EURUSD, due to reports that there may already be a more likely deal addressing the Greek debt crisis. The technical perspective signaling a positive tone was the recovery on the EURUSD and simultaneously a move higher with the USDJPY.

A move for the USDJPY higher is a lost in Yen value. The break from a triangle formation came at 100.60/85 that followed through at current price of 101.99 from a rising equidistant channel application. Closing prices above these levels would still provide a positive tone thereafter with a further corrective daily moves on both directions giving a false reversal scenario.

A pause and consolidation after a dramatic move is likewise considered which would cause some traders to reluctantly create trade positions. A word of caution, never try to catch a rapid market movement as pullbacks would cause to trigger stop loss due to wide price fluctuation.

Forex Confirmation Analysis for Feb 6-8 LIVE

2012-02-07T10:33:00.000-08:00

Technical Perspective: GBPJPY

2012-02-06T09:57:00.000-08:00

GBPJPY Cross as of Feb. 06, 2012

On the Technical perspective; the GBPJPY started of with the GBPUSD initial price reversal at 117.53 low; with a higher bottom at 119.55 serving as a good support, likewise a double bottom price level within a rising channel. The GBPJPY is a 2nd cross rate currency pair that has very market potential which has been shadowing the GBPUSD on its 1st leg of a price reversal. While breaking its trendline resistance and its current working price of 121.15 is above the 21WK-MA of 120.85 as shown of this candle chart of the GBPJPY on a Daily formation. The MACD is now on a positive tone after the movement while the cross awaits some follow through from the GBPUSD. Its initial attempt to its previous high of 121.85 may find some temporary resistance unless a USDJPY recovery would out pace the GBPUSD on the way up. A market behavior of the GBPUSD correlation with the Japanese Yen vs. the USDX would be the primary focus for the coming weeks ahead.

EUR-GBP-USDx SRO 2.6-8

2012-02-04T03:51:00.000-08:00

Though the numbers were good, the structural fact of real unemployed US workers specially younger graduates as defined by some analyst does not sufficiently support such dramatic moves in the marketplace until the time for a follow-through would occur from hereunto.

EURUSD DAILY

As of week ending Feb. 03, 2012

After touching a higher at 1.3220 on 01.22 the EURUSD has had difficulty penetrating and serves as the initial resistance for now. A corrective move lower to 1.3025 from the past week have manage to hold its support while directional movements whipped-saw from the high-low to close at 1.3145 for the week ending the 3rd of Feb.The resiliency of the Euro is really supported by the EU leaders working real hard for a deal other than Germany's A Merkel meeting with China for some assistance. Although, a fundamentally bias news would justify that the EURUSD may have some legs technically speaking to move higher well above its initial resistance.Extensions is within a trading range of 1.3360 21Wk-MA and at 1.3480-1.3550 areas for the EURUSD.

GBPUSD DAILY

As of week ending Feb 03, 2012

Meanwhile, the GBPUSD first resistance levels have been marked at 1.5882 high with a low at 1.5705 support while closing for the week at 1.5815 well within its trading range. A spill over of contrary sentiments by bull players would likewise show in the opening trading days of next week. However, even with a daily up/down swings for the pairs would give way for the true direction near term trend to move higher.
A word of price and behavioral comparisons would be that there is a current price imbalance and discrepancy between the European pairs vs. the USD. Likewise causing an irregular market movements of price swings which can also been seen with the EURGBP cross rate. Until all three pairs are re-aligned with their corresponding objectives then such divergences in the Moving averages would be realized. Some due diligence is necessary to establish your trade decisions.

Now, in spite of the good report of the Job nos. at 243k the USD slightly manage to move higher with mixed reactions by traders and moved within the 77.60-79.57 trading range for the week and ending at the 78.95 just above its support levels. On the technical side, the 4 hourly chart formation of the prices compared with the Stoch/RSI technical combination have indicated an positive divergence resulting the USDx to move higher to 79.25 then closed for the week at 78.95. And the market's reaction for the past week have surely been a pause and a consolidation. The intra-day and week candle bar indicates that this week's price range has been a correction only before it resumes its near term bear direction.

Megatrade101 would likewise maintain our market outlook for the near term, where the USD is to move further south based on our market view report dated the 30th of January with daily correction higher from time to time on the opening trading days next week. As of this writing, no such indication for a price reversal change would occur for the USDX to go higher except on a daily price & session to session turnovers of the three major markets. Whenever the prices do move otherwise, we stand to be corrected. However, market conditons varies from time to time and whenever it does; alternative plans are in place to correct a speculative outlook by implementing trade decisions that can only prove that percentage trading will be the best strategy to outlive such a volatile market. Managing & controling losses will likewise protect the gains. Thus building equity on top of one's investment capital can and will always be used to pay off the losses and not coming from the principal funds.

These choppy behavior we have seen with the EURUSD, GBPUSD and particularly the cross EURGBP is a typical market behavior between the tug of war by the bull and bear players. Although, the candle configuration for both European pairs have been seen by other analysts to be carving out a top in prep for a downward direction. True enough to some extent, that we could see a daily consolidation with tight ranges while waiting for some news to trigger a rapid price fluctuation. Unfortunately, not even the jobs data really moved the Forex market. As investors shifted cash flow investments to the stocks which we saw have moved higher right after the report.

Issues to consider: inflation, unemployment figures, housing, Iran & Israel, Oil /Gold and the stock market /SP500

USD back lower from correction.

2012-02-01T06:13:00.000-08:00

Technical perspective: Fig.1

As of January 31

The USDX have indicated a slight recovery from its recent low at 78.74 well within our support trading range of 78.05-78.85 initial objective from the high of 81.78 basis point. The daily price movement would be in both directions as position adjustments takes place towards the opening of the new month of February and the closing trading days of the week. The USDX current outlook for the weekly intra-candle bar is within the range of the previous bar signaling a slight retracement from the downward movement resting on the support. However, the overall technical outlook is a near term bearish formation would continue until it finds a relative higher bottom for the index to continue its upward trend direction as shown on fig.1 chart.
The catalyst to trigger some momentum lower would eventually come from one of the fundamental reports expected this week especially for Thursday and Friday data. The significance of a slight correction higher as it opened for the new month of February at the 79.36 and currently working back down to the 78.85 mid-week support on a trading session to session basis and engulfing the corrective gain yesterday as of this writing.

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

2012-01-31T06:11:00.000-08:00

Forex Market Analysis SRO 1.31

2012-01-30T20:30:00.000-08:00

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!

2012-01-27T10:14:00.000-08:00

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

2012-01-26T08:13:00.000-08:00

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

2012-01-23T02:23:00.000-08:00

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

2012-01-21T02:46:00.000-08:00

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!
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Mid-week Analysis 1.18

2012-01-18T22:39:00.000-08:00

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

2012-01-15T23:36:00.000-08:00

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

2012-01-12T00:10:00.000-08:00

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.

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Forex prices stalls..

2012-01-10T22:25:00.000-08:00

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

2012-01-10T05:25:00.000-08:00

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'

2012-01-08T23:14:00.000-08:00

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

2012-01-06T09:23:00.000-08:00

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

2012-01-05T05:50:00.000-08:00

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

2012-01-03T09:16:00.000-08:00

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/

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Greetings for the New Year 2012!

2011-12-31T00:25:00.000-08:00

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!

Update: EURGBP Cross & GBPUSD

2011-12-29T21:04:00.000-08:00

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

2011-12-29T03:19:00.000-08:00

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!

Forex Trading: Spot FX Vs. Futures SRO

2011-12-20T03:38:00.000-08:00

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...

2011-12-20T03:13:00.000-08:00

FOREX: Behavioral Analysis EURO & USD

2011-12-14T05:40:00.000-08:00

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.

AUDUSD & US DOLLAR INDEX 1209

2011-12-09T02:38:00.000-08:00

Market Analysis-SRO 1207

2011-12-07T00:46:00.001-08:00

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/

USDx TUG of WAR 2

2011-12-05T07:55:00.001-08:00

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

Finally - A Concerted Central Bank Action

2011-11-30T07:59:00.001-08:00

When was the last time you remember a concerted effort of central banks in the market?
*For central banks aim for a joint intervention is simply to calm the markets. This is exactly what happened in the year 2000, and of course it could happen again whenever the real need arises. Intervention occurs when a central bank steps into the open market in an attempt to strengthen or weaken its own currency just like the intervention in 2000 was a concerted effort by the Group of Seven (G7) nations to stabilize the Euro.

*The Federal Reserve, the European Central Bank, the Bank of England and the central banks of Canada and Sweden effectively reduced primary lending rates by a half percentage point. Switzerland also cut its benchmark rate, while the Bank of Japan endorsed the moves without changing its rates. Thisoccured in October 08, 2008. And apparently, the Chinese central bank joined the effort — without explicitly saying it was doing so by reducing its key interest rate and lowering bank reserve requirements to free up cash for lending.
For a complete analysis supporting our Market view TUG OF WAR - USD, EURO & GBP in a Fundamental stand point visit http://www.megatrade101.com/ for the continuation of this report.

TUG OF WAR - USD, EURO & GBP

2011-11-29T11:13:00.001-08:00

With the TUG OF WAR, as in the ART OF WAR between the US Dollar and currency majors remains volatile, as we have seen on the opening Monday and Tuesday's corrective movement finally failed with the EURGBP cross rate giving way to its original directional trend lower.

After touching a short-live rally back to the 0.8603-0.8610 trading range as indicated with a circle on the chart Fig.A compared with the previous charts on Fig. 1&2. The continuation lower have been attributed to the steadier and corrective move of the Pound slightly higher compared with the lower Euro as of this update today the 28th of November 2011.

Currently, the EURGBP cross at 0.8533 below the S3 PIVOT support nearing its retest of the lower band

of 0.8380-0.8450 from its initial attempt as we gain closer to the end of the month's trading. However, the overlapping case scenario of closing month's trading within the mid-week closing month will provide a glimpse of the pre-market sentiment. The weekly candlestick bar will move in sync with the monthly bar's outlook giving a head start for the new month to open. This is a critical and important aspect of trading both Spot and futures, with the new month coming for December that would switch the nearby months forward. A closer look and analysis of both would be an advantage as a lot of traders do know the correlation of

Spot and Futures but without the distinct significance of an overlapping closing month. This is one of the trading tips that we suggest to seriously look into.

SEQUENCE OF MARKET BEHAVIOR & PRICE MOVEMENTS

Much Appreciation!

2011-11-27T21:01:00.001-08:00

MEGATRADE101.com

Wishes to thank all our viewers for making our Megatrade101 video

be included in YAHOO's Search for
TOP ARTICLE/VIDEO IN FOREX INVESTING.

STRATEGIC FX TRADING TECHNIQUES

PIVOT Price Levels for EURGBP Cross

2011-11-22T03:23:00.001-08:00

EURGBP DAILY as of 11.22.11

Identifying the Pivotal point for the EURGBP Cross rate after its continued downward trend momentum from the registered highs of 0.8820 down to the 0.8484 is very difficult. Although, based from our previous market view report dated the 1st of November where we called a probable low between 0.8420-0.8460. (Pls. refer to EURO, EURGBP & GBPJPY price reversal on our website)

The registered low then was at the 0.8484; not too far from our calculations and it was at the 23.6 Fibonacci support retracement levels providing a similar support. And thereafter, the 2nd re-test of that price extension dated the 10th of November and closed above the 0.8550 spinning top candlestick bar for the weekly have indicated a halt on the extension. The succeeding bar was not as signficant as the correlation with the negative news reports in the Euro Zone prevailed and still is up to this writing. As the obvious reports coming from both sides tries to outweigh trade investors to play the markets in a defensive mode. For a detailed technical outlook and analysis please visit: http://www.megatrade101.com/

Do expect some pullbacks in between trading session in Europe, Asia and the US as the coming Turkey holiday is just around the corner.

Only the best for your trades!

US Dollar Index Market Analysis

2011-11-20T22:51:00.001-08:00

For the past decade, with more e-trading developments and accessibility to the markets have made it easier to monitor market behavior during market holidays. The up-coming trading period before the Thanksgiving holiday would prove to be one of those times where a handful of institutional and majors players would again be in place. Although with an expected mix bag of market directional movements and the general trend developments into a bullish advance through the year end from thereon as a comparison as far back in 2008 that should not be discounted unless otherwise proven not to follow the cyclical pattern hereunto.

US Dollar Index Weekly Candlestick Chart

However,as for the US Dollar unexpected downward distortion after touching the 79.83 by dropping back down in October for a re-test of the 74.72 low was the appropriate corrective move in preparing for the 2nd leg higher where the market conditions are presently at. The backlash of news reports from both continents have been dragging this lagging recovery which should be respected from the market behavior. As price movements by market numbers doesn't lie. And the only way that we can stay unbias of any market analysis is to always trade with a level playing field in any given position(s) while in the market. For the Technical description & Analysis, please refer to our website at http://www.megatrade101.com/

The coming holiday trading conditions will certainly be a complicating factor for trading the US dollar. For the time-being, focusing our attention on the backdrop for financial strains; with the European market’s are particularly stressed; with both the EU and other major US Financial bank's exposure to the EU debt crisis have been a huge part of this global recovery. Money market funds have significantly reduced exposure to EU banks, though the ill-effects have nevertheless found their way into funding costs in the US system.

These are the underlying issues that we should consider to be critical rather than the ineffective event of risk aversion and appetite in the market place. The coming crucial reports this week; including the 2nd reading of the third (3Q) quarter GDP on TUES NOV. 22, the Fed minutes, the UK BOE MINUTES on WED. NOV. 23; US durable goods,the University of Michigan Consumer Confidence Nov.numbers and personal spending and on the EURO ZONE side would be Germany and the UK's Nov. 24 GDP figures.

All this reports would occur towards before and after the end of the trading week of the Thanksgiving holiday which would provide the market with an ever increasing volatility from lack of liquidity in a thinly traded market to position adjustments and liquidation for the rest of the month of November towards the end of the trading year. However, pay close attention to market behavior as these are the ripe times to consider.

Just a side precautionary note where we would like to quote the words of Gordon Gekko from the movie Wall Street - Money never sleeps..."bulls make money, bears make money...but pigs get slaughtered".

Only the best for your trades!

Forex Volatility Increases Squeezes GBPUSD Trade

2011-11-14T20:48:00.001-08:00

Review & Analysis: Increase Volatility

The contagion and ill-effects of the European crisis still haunts the financial and stock market in spite of the short lived relief of the political change of the interim governments in Greece and Italy. Meanwhile, the general sentiment which was fueled with fears amid political instability prior to and thereafter in Greece and Italy; not to mention the weak fundamentals from the trade deficit widening in the U.K. Which prompted the European majors to continue to head south of the charts. While the continued demand for the USD as primary & safety currency choice supported the US Dollar Index to hold above the 77.05 levels.

As early as the American trading sessions on Monday, have started and all through out the entire mid-trading sessions, the market price behavior particularly the GBPUSD have been really 'squeezed' with volatility and price extensions lower. Which have given back the gains that it had made from the previous day's trading. The obvious bull and bear spreads were traded heavily between major institutional players with at least 150-200pips in both directions for the past couple of days. Swing and day speculative traders would have found this extremely dangerous as more market capitulation were seen along the entire trading sessions.

GBPUSD Daily

The GBPUSD established trading range is between 1.5850 - 1.6160 inclusive of extensions from October 26, 2011. The wide range and consolidation period shows the ectreme uncertainty of bull and bear trades struggling to dominate the market especially with the movements of the past closing and opening days of the trading week. But the increase market shift of prices can change at any given notice coming towards the mid-end of the week's trading.

Currently, the GBPUSD is at the lower band of the support at 1.5883. Almost all traders and investors have concluded that even with the partial political resolution in Europe, it still does not change the fact that these countries in Eurozone would be heading to recessionary period for a longer period. Thus, the fundamentals would be for the European majors to be in the defensive. For more information about this review and analysis please visit out website at http://www.megatrade101.com/

EU Majors Confirms 11.01 Analysis

2011-11-09T06:47:00.000-08:00

USD influenced by EU-Italy Crisis

The price direction for the Euro today, half-way through the week re-confirms the Price reversal called last Nov 01. Its really not a matter of price but rather the re-affirmation of the overall market sentiment that has gauge investors shifting funds out of the Euro-zone. This has provided a price stability for the time being with the tight consolidation levels of the US dollar, as measured by the USDX Hi/Lo band where the current 77.42 basis point is nearing the high resistance band. The technical breakout may only occur with a strong momentum towards the end of the week's trading which would culminate with the release of the University of Michigan's confidence report on Friday.

When this happens a re-test of the 78.85 would likely be seen with extensions at the higher band and within breaking an inverted H/S formation that is reflected as a mirror imaged from the previous H/S daily chart formation. The high probability that the same would occur on the way higher when it happens. This has been a repeat only that the opposite circumstances would be inversely related to the down swing of the recent movement of the US dollar index when it touched a 74.72 low Oct. 27, 2011.

The location of the projected price direction when such a break higher would be beyond the Ichimoku Senkao Span A(green) breaking a neckline towards the next FIB retracement along the 78.85 basis point. Extensions higher would occur upon a completion of several daily pull backs until fresh volumes and price settlements would be made towards the week ahead. While the overlay STOCH/RSI still breaths positive with a 21/9 measure as compared to the T4-FIB 61.8% extension which would establish an overbought area if it attempts it in one spike upwards. This can only happen if and when a sudden unexpected event happens in both continents. But weigh in from the other is equally important. This can justify the technical outlook thus far.

Meanwhile, the current market situation with the EURUSD at 1.3603 low and 1.5932 low for the GBPUSD respectively has proven the investors prevailing market sentiments for the continuation of the US Dollar to move higher--another flight to quality safer bet versus the crisis in the Euro zone.

The defining analysis is based on the market's price behavior with a true reflection of the Price Page indicator which is indicative of the historical prices and price directional price extensions. As price extensions are derived from the average day & weekly trading range plus /minus the difference of the extended price higher/lower from the previous day/week's prices. And the number of days/weeks where such consolidation has occurred would be the measure of the directional trend higher/ lower.

Special Report: Trading the GBPCHF

2011-11-08T00:56:00.000-08:00

Is an alternate choice of the cross rates for the weeks to follow. The process of deduction based on the market's behavioral price movements has led to this preference. This process is not as easy as simply choosing which of the currency pairs would be appropriate to trade, aside from the market's potential that it would generate. The market psychology has played a vital role based not only from the current price trends, volumes and open interest; but including the historical correlations of each currency pair with a dominating and least dominant pair to choose from.

Trading the GBPCHF for the following weeks ahead has bottomed to two basic reasons in part of its technical overview from the chart patterns. One reason is that the British Pound has shown its resiliency for the past few months from its recovery price reversal which was at the 1.5270 GBPUSD rate which has sustained from October 06, 2011 extension & base price. Secondly, the USDCHF rate of 0.7071 has been the strongest appreciation for the Swiss Franc compared with the Japanese Yen's 75.55 intervention price levels. Timing market price movements is never easy, although a lot of traders and analysts have tried to anticipate such market speculative reactions but not everyone would have the distinct privilege of riding in one.

The GBPJPY trade of October 27 is one of those times where such an anticipation and a speculative decision was made prior to the Bank of Japan's intervention on the USDJPY rate. Luck and skill did play well and paying off for this trade which has been riding the price trend to this writing. The irony of the market's reaction before and after such volatile price action would 'stall' or others would term it simply as directionless as pairs would consolidate at a tight range. And the next move would come towards the closing of the week or month where position adjustments are made.

With trading heading towards the week, not much to really weigh except for the usual news wire crossing between the Euro zone with Greece, Italy and other contagion effects spilling over the rest of Europe. where a political divide and a financially strapped EU members are weighing a negative tone for the rest of the members as well. The other reports such as the German CPI to hold the same. While the ECB monthly economic report and the Bank of England's rate decision on November 10 and the US University of Michigan's confidence report may provide a clearer direction for other market participants and investors.

CCY CHOICES: GBPCHF STRATEGY

Long Position / on Market Condition Steady
Trend : Bullish ( UP ) after BOJ Intervention
Signal Indicator : Breaking a Channel / Trendline Resistance
Strategy : Using the USD Index as a Primary Indicator
Trade buying only on the way up from a correction
Exposure : 500,000 in leverage amt./ own discetion
Position: Long ( Buy ) on the way up with volumes * momentum
Current Price: 1.4250 as of 11.06
Entry / Exit : 1.4245 OB / 1.4680 OH
Risk / Tolerance : 1.4080 ( -165+/- ) on entry price +/-

Probable loss / Stoploss: 1.4000 ( -245+/- ) on entry price +/-
Potential Profit 1.4680 /even ( +435+/- ) OB on entry price
Rationality : 2.x from risk tolerance / Net Exposure pre-calculated versus overall trade position on margin requirement/maintenance / swaps / point value
Time Table : Within 1-2 week period + / -
Status: Closed / settlement based on net percentage gain or Loss on overall net position of trades within above period
Others: Using the USDCHF as cross hedge strategy for contingency

EURO, EURGBP & GBPJPY Forex Price Reversal

2011-11-01T08:03:00.000-07:00

Keeping pace with a rapid market after the unilateral BOJ intervention and now the EURO and EURGBP cross rates reversing their price directions lower is one of those unexpected market movements which we were referring to in our previous market view report on Oct.10-EURO & EURGBP key levels and the 'Mid-week Market Analysis 10.27'. As most Forex traders, hedge fund and portfolio managers were caught flat-footed on the main price reactions and repercussions that has spilled over across the board particularly the EURO and the EURGBP.

Currently, the EURUSD at 1.3650 with a low at the 1.3607 is struggling from the obvious market news on the EU debt crisis prompting the continued strength for the USDX to move higher now at the 77.52 basis point higher. Meanwhile, the cross rate EURGBP making its low at the 0.8546 with its initial objectives at this levels with extensions below the 0.8420/60 trading range.

Sequence of Trade & Applied Strategy:

The strategy in place since the 10.10 was after taking/settling the EURGBP short trade and simultaneously reversing to a long the EURGBP was the right move as prices have reached its extensions at the 0.8810. Although, our calculations were at the 0.8870 not too far from the registered high on the week of the 28th of October. Pls. refer to our market view on 10.27 above. Long EURGBP is Shorting GBP; hence long GBPJPY ( while USDX at 74.72 low and USDJPY 75.75 equilibrium price levels ) is hedging the GBP while buying the USDJPY as a cross trade strategy before the BOJ intervention. Cross referencing GBPJPY with the EURJPY was not an issue, since the EURO was more in the limelight.

Now with that said, the liquidation on the way down for the EURGBP as the GBPJPY rises is offsetting both positions while maximizing the market potential. The registered high on the GBPJPY is 127.27 with an intra-day corrective move lower, currently at the 124.76 as of this writing. And while the EURUSD and the EURGBP heading lower at 1.3674 and 0.8575 respectively. With extensions nearing their respective support levels but without discounting the possibility of further momentum as it moves forward the end of the week with NFP this coming Friday's report.

However, the momentum for the USDX to move higher was greater than just a probability; creating a sequence of short sell-EURGBP as shown on the chart makes more sense as the market lost confidence on a resolution to the EU crisis has driven the market prices for the EURO & EURGBP cross lower with much more conviction. Either way we have accomplished to level the playing field and would be able to tolerate any sudden and unexpected adverse price reaction in the market.

These strategies may be a lot more expensive and risky for others to manage. And there is no guarantee that the same results would occur as market conditions changes so rapidly that could also result in a negative balance on the account holder. Tolerance and risk factors should always be properly exercised.

Psychology & Market Behavior:

The market's behavior of stalling price market action and thereafter delivering rapid market prices in lightning speed is what makes the Foreign exchange market one of the most volatile and dangerous markets to deal with if not well prepared. As most trading platforms executing an entry and even stop loss would have difficulty in connecting with a busy line where most would not be executed at all. And wait for the next turn while prices have changed dramatically from your intended price action/order. We wouldn't be surprised really!

The sudden change of price direction and change of hands has made it clear that the market's ability the lat couple of days was susceptible and typical of price reversal on both directions. Catching unsuspecting players not knowing what hit them.

USDX vs.GBPJPY Cross Rates

2011-10-31T01:30:00.000-07:00

FX Timing USDJPY - Unilateral Intervention

2011-10-30T22:58:00.000-07:00

With the GBPJPY - Pound vs. Yen Cross Rate

The unilateral intervention by the Bank of Japan could never have been timed better from their previous market interventions. As other central banks supported BoJ intervention during the Tsunami / Nuclear disaster; today's move was triggered more towards market's over speculation as they have claimed that distorts with the economic fundamentals. The spike, as we termed it, then and now have been pricing in the 79.18/50 high and is maintaining at this levels.

The trading culture of Asian traders/strategist particularly the Bank of Japan has been known for their intervention skills of timing the market participants at the least expected time. Although, there is no real pattern that can be pin-pointed as to when such actions would be done, it is merely based on speculation as other traders would. However, with the length of trading experience these could be narrowed down with the kind of market behavior and price movement that currency pairs shows.

With that said, the GBPJPY was amongst the least expected cross rate pairs to move in closest line and correlation with the Japanese Yen. And obviously was not in the radars or market limelight during this time. This is simultaneously traded with the EURGBP cross rate as a cross trade from our long position as of the Oct 10 market view analysis. By following the sequential market analysis from October 10 to the 31th would provide a better understanding of our trade outlook and strategies applied.

As the Euro has been the dominant market moving pair due to the back and forth crisis between the sovereign debt and the US economy. Currently, the GBPJPY was the preferred pair even comparing it with the EURJPY, as most have stayed away from a bias bull market for the Euro especially with the G20 meeting thereafter.

Opening with the new month of November, overlay with the opening of the wee and closing day for the October month now stands to be volatile by the time US institutional players would come in after this Halloween weekend. The surprising move is what we have been anticipating and with some good choices between these currency pairs the GBPJPY couldn't have been a better choice. Please refer to our previous market view analysis dated 10.27 - Mid-Week Analysis.

Mid-week Market Analysis 2

2011-10-26T23:58:00.000-07:00

The market's increase volatility have shown price movements on both directions of the market place. As money flows between equities, asset class precious metals market, and the foreign currencies among institutional players. This has not been favorable with the US Dollar. As the US dollar index have now registered 75.75 low as of the Asian trading sessions towards the opening of European trading. Our opening market outlook dated the 24th of October have stated that the momentum would readily build-up as a probable break below the 75.85-76.05 range would cause prices for the EURUSD to make a follow-through heading higher when it has broken the intermediate resistance of 1.3880. Currently touching the 1.4014 high and is at the higher levels as of this writing.

EURUSD WEEKLKY CHART
As of 10.27

Apparently, as the market prices for the EURUSD and the EURGBP cross rates would now move higher throughout the coming sessions towards the American trading where we do expect a continuation of increase market price action and volatility to be aggressive. Daily price extensions and trading range for the EURUSD would be between the current levels with 1.4080-1.4110 range and as for the EURGBP cross would be seen at the extension range levels of 0.8750-0.8870 respectively.

These current two days of trading activity to follow will culminate higher as the upcoming report this Friday would also be the catalyst in the final direction for the US Dollar moving forward. However, a word of caution should be properly exercised from hereunto. As these are the typical market conditions where 'bait & trade' are done amongst the bigger institutional / hedge funds prior to closing of the week & turnover positions of the month.

In essence, watch for the market sentiments and volumes from the European trading hours that may trade the major pairs to their extreme extensions, then spill-over towards the American trading session before the major report on Friday would be release. By then the total opposite would get unsuspecting main street investors what hit them only after the market has moved opposite of the current market price swing.

Notable, compare the price behavior between the USD, Gold prices and oil as their correlation may also weigh for the USDX to move towards the end and opening of the new month by next week.

Market Analysis & Outllook

2011-10-24T21:26:00.000-07:00

The overall fundamental reports towards the end of the week between consumer confidence, rate decisions, US GDP ( Gross Domestic Product ) and the 2nd bout of G20 head of states meeting have moved the market almost in a speculative stance. Speculation has prevailed the market sentiments not to mention the position adjustments being made towards the end of the week and month of trading volatility. Risk appetite has remained with bias bullish for the European majors despite of the overwhelming sentiments of uncertainty contrary to a positive outlook that there will be a compromised resolution to the sovereign debt crisis.

US Dollar Index Daily Chart 10.24

The lack of conviction to re-establish its trend for the US Dollar remains in the market. The US Dollar Index has maintained its lower price levels as seen at the 76.14 basis point, relatively too close for comfort and the likely scenario as some traders may retest its lower band purely on a technical basis. The Daily candlestick formation shows the complex head and shoulders formation with the support levels found at the 75.85 - 76.05 daily range extensions. Take a closer look at the rising channel from its previous low where a consolidation was made prior to the rally that the US Dollar did before changing its course lower from the top.

However, who would take up the risk of selling the US Dollar at this levels is the question. The USDX does have an extension below the 76.05 which apparently would cause some probable market capitulation for short-sellers of the Euro. As the EURUSD have extended its price levels from the important 1.3880 and is now at the 1.3915 a slight break of its resistance line as indicated on the chart. Expect a volatile end of the week & month trading as position adjustments would be made. Volumes would suddenly appear within this period of trading sessions with investors makes and shift funds between asset class and liquidity positions by then.

Meanwhile the continued strength of the Japanese has been in the limelight although subdued by the European debt crisis and the rescheduled meeting this o|ct 26 from the G20 leaders. Currently, at the 76.05 levels with a registered low at 75.78 last Oct. 21; the sustaining imbalance between bulls and bears do remain as reluctance prevails in the Asia Pacific region of the outcome of the coming meeting. The bias technical bulls for the Yen to appreciate remains a stronghold by speculative institutions / banks in the market place. The technical configuration remains to the downside for the USDJPY as momentum deteriates and not a lot of speculative positions establish at this level.

USDX.1017 Follow-up Market Analysis

2011-10-18T04:44:00.000-07:00

Strategic Opening Week Analysis for the FX Market Oct. 17

2011-10-17T08:21:00.000-07:00

The highlight of the G20 meeting which may or may really not dictate the pace of the market will soon be seen this mid-trading week. Whereas the rescue package that may bring to a closing of the European Debt crisis is in full swing. Of course this is based on those reported issues that came about to even expand the bailout, an establishment of a recapitalization package and more importantly a reduction of as much as 50% of the Greek sovereign debt problem.

This has led some strategist and financial analyst to digest and course a plan of action especially for the FX market. The time frame we are looking at is the price behavior of the major pairs before the Oct. 23 and Nov. 03 where it is expected to be unveiled at the next G20 heads of state meeting.

Now between now and then, the initial market movement we have seen so far has been an overall corrective movement for the US Dollar and a considerable rally of the Euro from last week's trading. Except that the pullback of the US Dollar has been extended down to its previous low of 76.44 based on the US Dollar Index low establish at the opening of this week's trading. Pls. compare the inverse chart relation of these two pairs and see what you can derive from the market psychology of their market behavior at this early trading week.

The technical configuration of the USDX from the chart's perspective, as we have mentioned then on our 09.27 market view analysis, that the expected Ladder-like upward movement for the USD Index came true to its form. And completing the measurement of the previous consolidation channel and breaking away from the channel. Pls. refer to the Daily USDX Candlestick chart formation. Wile reaching a high at the 79.70/84 basis point on Oct. 04 trading. Had it not been for the fundamental news of Chancellor Merkel & Pres. Sarkozy support for the Euro, the rally would have found some impetus to move on but it did not.

EURO & EURGBP Cross-Key Price Levels

2011-10-10T07:51:00.000-07:00

The focus is on these two major pairs as the key pivotal and key prices established is well defined in spite of the market's volatility and wild price action from last week's trading. The 1.3345/50 levels for the EURUSD is a major support (S1) at this point of time. We have called a price objective on our 09.27 amrket view analysis at the 1.3180; although the extensions were set at the 1.3144/60 spread that moved last Oct. 03/04 daily price low. Henceforth, the current price levels now at 1.3650 has proven that these key prices to be supportive. A 500 pips move difference from the low from just a week ago.

The correlation on the EURGBP cross at those low prices were registered at the 0.8528/32 levels and a turn around has been seen This prompted our position to be adjusted prior to today's movement. With closing and taking our gains from our previous shorts dated 09.29 as shown on the left hand side and subsequently creating a long prior to today's price action higher has been quite fruitful. As the strategies applied were executed properly as the chart formation on the lower side proved to be quite profitable. And the current price for the EURGBP cross rate is at the 0.8710 as of this writing. As the weekly candlestick from last week's closing pulled back lower from liquidations of positions.

This is an encouraging signal where an inverted hammer resting on the weekly trend line support would be supportive at the early trading of the coming week. Cross trading between the Euro major and the EURGBP cross rate is an applied strategy that may be quite expensive to maintain but the trades and risk factors are well defined whenever an executed trade turns to be positive. However, not all spread trades would result to be a gain. Proper discretion should always be exercised when trading the Forex market.

FX Prices Spills-over EUR-GBP-AUD

2011-10-03T11:28:00.000-07:00

The USD's ability to hold as an alternativeflight to quality investment has not failed so far, as the contagion over the European Debt crisis weighed heavier. Although with some modest gains in the US economy, the serious threat for a slow down prevails in the mind of the investors and mainstreet.

The spill over effects on prices can be seen and felt as stocks deteriorating over confidence and the Foreign exchange market has affected the much of the Euro and Cable. EURUSD low has reached its extensions at the 1.3236 nearing our target objective of 1.3180 as written on our Follow-up Analysis 09.27 market view report.

In essence, our outlook remains well in place as we pursue our remaining positions on the EURGBP cross rate shown on the left hand side figure. Whereas the opening of the new month for the fourth quarter of the year would carry the negative market sentiments from last week's closing for the third quarter and for the month of September. The two earlier positions on the figure shows the the target objective at the 0.8550 which has been achieved as of this writing. We shall be assessing the volatility index, volumes and open interest on the futures inverse price chart and compare its configuration with the Inverse relation with the USD vs. the EURO. However, the next S2 target levels would well be at the 0.8405/10 range and extensions lower depending on the velocity of short-covering and speculative trades.

The current working price for the EURUSD at 1.3250 rests on an extension support from the previous week's low on January 16, 2011. Will extensions may trigger 1.3180 may find some light liquidation and speculateive longs merely based on oversold market conditons. This goes the same with Cable except that a probable corrective movement higher should not be discounted on a daily basis. A steadier market tone for Cable may well be investor's reluctance to follow through with speculative shorts at current market conditions.

Nonetheless, sustaining our AUDUSD call to continue it's downward trigectory since last month remains intact with the continued strength of the USDX as it gains momentum higher. The Ladder-like manner on the chart formation as we have aslo indicated from the above link report has shown its true colors. The daily candlestick bar formation on the US Dollar Index have shown as the support level S1 now would stand put at the 78.80 while gaining its strength towards the next R2 range levels of 81.05/10 basis point. Please visit our video support on the USDX 0919 Market Analysis / 8 Technical tools Applied on Youtube.

Trend Following EURGBP Cross

2011-09-30T01:15:00.000-07:00

The recent Euro recovery from its lows were simply a relief short lived rally with supporting evidence of Euro Zone leaders to support Greece and neighboring countries necessary to sustain stability in a crucial financial crisis that would reverberate throughout the financial markets.

The upward Euro extension to as high as 1.3689 met its 1st R1 in line with its 21 day moving average where certain pull backs as the corrective US dollar found some support at the 77.30/45 basis point pivotal price reversal. Currently at the 78.29 recovery level as of this writing.

The relative price reaction seen from the EURGBP cross came about when the price levels came touching the 0.8738/50 range resistance and currently working its way back south at the 0.8667 price level where a second attempt to the downside would occur as the end of the month liquidation and position adjustment for the third quarter of the year ends in a negative tone for the Euro Pound cross. Which so happens as the continuing down trend re-establishes its footing. There is no real sign of a continuing rally as almost all indicators have reaffirmed their bearish sentiments remain in the market place.

The daily chart configuration is a small version of the overall picture and likewise the inverse relation of the Euro vs. the US Dollar when considering the weekly candlestick formation. The monthly even looks better and more defined as the position for the next coming month for the fourth quarter would still continue. However, the opening of the new month would find some volatility that would hinder swing short term trades critical. Meaning, that to be able to successfully trade this market, one should bear the volatilty and account size as tolerance levels to remain in position would depend on the ability to define entry and exit points from wider price swings of the market.

Targets levels for the EURGBP cross would be prices much lower than what we currently are trading till the first week of October. The levels where it would meet some longer term support would be at the 0.8550/80 range unless any new incentives to perk the EURO higher says otherwise from hereunto.

Follow-Up Market Analysis as of 9.27

2011-09-27T22:52:00.000-07:00

Listed below are significant issues that best describes theForex market on our perspective:
For a complete analysis including the AUD-JPY pairs; visit http://megatrade101.com

* Based from our USDX 09.19 market view, the US dollar indexmet its initial R1/R2 at the 78.08 / 78.85. A wider price swing is expected inboth directions as it makes its way back higher with increasing volatilityahead of the end of the month position adjustments. However, we do expect aladder-like upswing for the US dollar moving forward to complete its seconddaily leg higher to the 81.10 or better in spite of the mix reports for the USeconomy.
* The precious metal's corrective and dramatic move lowerdown to the 1532.59 liquidation levels with increased volumes have met renewedexchange / arbitrary position adjustments from Euro denominated Gold positionsto flight to quality US dollar denominated assets. This also prompted US Stocksto change in both directions in spite of some mix reports also coming from theEuro zone. Although, a price and trend reversal had been previously called theUSD1510/50 range is an established support for the time being.
* Euro zone's relentless efforts of perking thedeteriorating EURUSD would have a lifeline of relief efforts European leadersin supporting the Debt crisis as the Euro's short stemmed recovery may prove tobe just a mid-week effort to support it. A further extension would haveprompted an all important price level of 1.3180 which was a striking distancefrom its previous low of 1.3361 extension that met some short-covering fromefforts made by Germany's Angela Merkell. On a technical perspective though,the 1.3350 support price seems to be holding a fresh incentives from thateffort brought about some slightly bullish players in the market. As the chartformation shows a parallel channel support at the said price levels. And adaily buying divergence occurred at these levels while it was moving lower. Donot discount the probability of a return to the lower prices for the next fewdays prior to the end of the month. Otherwise, any move higher would only be acorrective mode as the continuing pattern of bearishness still prevails in themarket sentiments.

USDX 0919. Market Analysis / 8 Technical Tools Applied

2011-09-20T02:46:00.000-07:00

Gap Strategy for USD-EUR-AUD

2011-09-19T05:33:00.000-07:00

The opening gap for the US Dollar showed it strength on the backdrop of the European crisis which also prompted the Euro and the Pound to open with a convincing gap that accelerated the continuation of the US dollar. In spite of the lower closing at the 76.54 and opened at 77.16 on a weekly basis would seem to be a corrective move before a downturn would continue. However, the daily open would fill-in that particular gap but the bulls would at the forefront as it looks on the European and American trading sessions.

Indeed, the third quarter of the the year would be identified as the price reversal phase for the USD. As the established low is currently at the 72.90-73.85 (S1-S2) trading range and the resistance levels would be at the 78.05-78.85 levels (R1-R2). The sideways consolidation of the USDX from the past several months would be the length of its corrective move and a secondary leg higher is currently in the making. However, these formations which can only be established on a technical formation may take some time to form. But the rally would continue after every lower price made before the upturn would re-establish its trend.

For a complete report and analysis including the USDX, EURGBP and AUDUSD currency outlook please re-visit our website at http://megatrade101.com/

FX Analytics - EUR/GBP/AUD

2011-09-13T04:39:00.000-07:00

The dynamics of the currency market has now proven to be continuing where we have actually left off from May of this year. with the EURUSD pair; from a registered high last May at 1.4940 was a first signal of a Price & Trend Reversal followed by a series of weekly volatility until a corrective move from the middle of July through the 3rd week of August, which showed a wide trading range from a low of 1.3836 to 1.4550.

This corresponded with the US dollar weakness only until the last week of August. The irony of the matter, was that the signal for a continuing bearish directional trend can only be identified on an overall monthly chart formation. However, the back and forth fundamentals between the US and Europe has made it difficult to find a perfectly good timing for traders meeting a wider trading range each day that almost averaged between 150-250 pips on both directions of the market. Where short term trades would easily be taken out.

EURUSD Weekly Chart

With that said, the EURUSD & GBPUSD has finally gave way to the downside with more velocity setting the pace for the US Dollar to really get a new lifeline for its recovery. The 72.90 basis point proved to be quite supportive in spite of the several attempts reaching the 73.40/50 levels before the much awaited recovery working at the 77.38 basis point as of this writing. Although, support prices for both pairs have come to a slight corrective mode where certain buyers have emerged from the past couple of weeks price drop. This correction would be short-lived while the fundamentals this week would dictate the immediate price direction. The GBP & EU zone core consumer price index for August followed by Jobless claims, and the US retail sales for the earlier part of the week may provide some hints before the US University of Michigan confidence report would be coming out.

Aussie Dollar Daily Chart

Meanwhile, the Aussie dollar has dropped to its lower levels currently at the 1.0280 and would be re-attempting to reach its previous low parity levels again within the next couple of weeks ahead or even earlier. The technical candlestick formation for the AUDUSD thus far shows its bearish signal as indicated on the left hand figure.

The probability to reach parity levels would be attempted in the next trading days ahead as it levels off while the US Dollar Index continues its rally.

Directional Trend EUR-GBP & Cross Rate.LIVE

2011-09-09T08:27:00.000-07:00

SNB EURCHF move effects on FX Prices...

2011-09-06T09:25:00.000-07:00

and its market behavior.

With the not surprising move by the SNB; market participants were simply caught flat-footed as the timing would not have been perfect for US Traders & institutional players by this move. The typical market behavior for a London shake/fake-out that we have been anticipating; but nearly came from the Swiss National Bank's move. This has been reflected from our previous market view post on the market price behavior. Although, there were already statements made prior to the move but the unexpected move was one over the speculative trades by the Swiss National Bank traders. Surely, some talk would give rise with the BOJ may follow suite with a similar strategy which may not likely occur.

But what does this all mean to the market's current behavior and effects after the fact?

As a matter of market analysis, price behavior would now depend on the volume and open interest entry on the financial futures by hedgers and options traders with a cross trade between the Euro vs. Swiss Franc. The relative cross trade since the present ceiling has been set; others would simply say... a pegged vs. Euro would favor major investments in Europe as a way to protect their interest; in case such news would emerge back from the European crisis would snowball towards this quarter ending.

Fact 1: EURCHF currently at the 1.2022 from a low of 1.0030 last Aug. 08, 2011 is in place. Extensions would be a small variable price level of 1.2335+/-, however such move would make the USDCHF more stable after the fact and remain at bay for the time being while waiting for some fresh news on the US side for a continued rally for the US Dollar Index. USDCHF is currently at the 0.8573 from a low of the day's opening at 0.7849 levels. Initially the good numbers from the ISM-US Manufacturing was another fundamental providing a new lifeline for the USD rally other than the flight to quality /safe haven investor's mindset.

The SNB move sent the USDX higher to its current levels and spill over effects continued for the European majors as the GBPUSD sets a low at the 1.5950 as of this writing. Coming through our initial market objective set between the 1.5870-1.5990 trading range. Overall short trade on the GBPUSD set previously dated last 08.25 Sell @1.6269 is currently net positive on the balance sheet. The continuing market sentiments would hold for now as the USDX continues to gather some more positive breath for a rally. This would only hold true to its form above the 75.50 levels to maintain.

Pls. review most recent market view analysis below and a complete report on our website http://megatrade101.com/

FX Analysis-Labor Day spill-over!

2011-09-05T09:52:00.000-07:00

Thin Labor holiday trading would simply mean a spill over of the closing sentiments and continuing trading activity from last Friday's closing. This would be a lowering price for the European majors as seen with today's price movements. The opening prices across the board already indicated an a gap where some players would take advantage of the US market holiday with just a few traders left over for position adjustment as the new month opens its trading towards the second week of trading activities. Re-emerging European contagion on the debt crisis has somehow been weighing in on the European currencies as it moves further lower beyond their active support levels.

With the Euro currently at the 1.4080 low attempting to cover an extension through the 1.3989-1.4010 initial objective at the start of the trading week. And the follow through price reaction by the GBPUSD at the 1.6089 working price from an initial low of 1.6060; whereas the extension of a low towards the 1.5875-1.5990 trading range that would be attempted for the week.

However, volumes and momentum would dictate the price movement and volatility after the North American sessions open after the holiday. However, the recent indication of a rally with the US Dollar Index showing its colors by bullish traders taking the risk of earlier longs from the start of the week registers a number above the 75.05-10 basis points. With a slight advantage on the opening prices and above its 75.10 levels of resistance. European institutions may figure a way to push USD higher even before the North American opens catching their counterparts flat-footed before then. But this is purely speculative as it could be a shakeout for bearish players still calling for that illusive double dip recession to make it official.

Inflation Adjusted Gold Price

2011-08-31T05:56:00.000-07:00

Gold Prices Daily chart Aug. 31, 2011
The "Hanging Man" Candlestick bar can
be seen on a weekly chart.

The technical configuration in Gold would favor speculative short sellers and hedge fund portfolio managers to manage variable risk and protect the downside risk after the weekly candlestick bar for the precious metal was formed. The weekly closing which apparently formed a 'hanging man'; where a sell-off occurred after registering a new high at USD1912.02/oz. and drove the prices lower to the USD1702.90. The price closed for the week ending the 26th of August closed at USD1827.26, which reflected some profit-taking and protective short-coverings during that period.

An increase in short sellers towards exchange traded funds (ETF) and options to cover previous long positions and hedge players to insure their profitability until the prices settles down for the time being. Some position adjustments were made that led to the quick price recovery towards the closing by some institutional players taking advantage of the wide price swing. Currently, the prices have stabilize at the USD1830.29+/- and the near term resistance is the previous high of 1912.02. Our previous calculation for inflation adjusted gold prices compared with the Dow Jones at 10550 was at USD1550.00/oz for Gold as the prices have been re-adjusted accordingly with the Dow at the current levels are just about right. Although, prices would keep its pace with the DJIA continue to move higher after the previous drop as the same did with Gold prices. The only assurance and strategies that is being played out to day is an increase in hedging strategies utilizing the ETF for long term position buyers of Gold investments.
For more articles on the Currency market, pls. visit our site at: http://megatrade101.com/

Euro Inverse HS vs. EURGBP Cross Rising Wedge

2011-08-30T07:32:00.000-07:00

The Euro Zone economic sentiment data on top of its negative confidence prompted the EURUSD to sustain a drop from its previous high of 1.4548 and currently at the 1.4395 as of this writing. This has provided the US dollar index a new lifeline at the start of the trading week and the end of the month. The key support range of the US dollar index from 73.40-73.85 has been quite resilient for the past weeks. However, on the upside the 74.40-75.10 is what needs to be watched, as this is the average trading range for the few past weeks.

As analyst and traders are waiting for some clues as to where the direction of the market would be from the FOMC, US Consumer confidence, the upcoming report from the NFP and the Euro Zone's Producer Price index within this week. These reports would probably be able to provide a firmer indicator that would break the market's trading range for most majors pairs. Although, volatility still remains high at present; as wider price fluctuations prevail before the actual directional trend would re-emerge at the closing of the week. Daily price changes can be confusing as it stalls after each move and changes direction within two to three days thereafter.

On the technical perspective, an initial price break on the upside for the Euro would normally meet a pullback as it builds volumes for fresh postions upon the entry of the new month. These would enable position adjustments towards the closing of each month. Other traders would view it as a false signal / breakout but true to its form the overall techncial formation of an inverse head & shoulders formation is very much in place. A typical bull trap where sellers would emerge during the same reaction on a daily basis. Meanwhile, the GBPUSD maintains its form and a sustaining weekly volume exists as prices continue to accelerate in a much slower pace like the Euro. This supports the intermediate upside trend for the EURGBP cross rate within a Directional Trend lower as a rising wedge is being formed on a weekly basis. The price extensions for the cross to retain this formation should not be higher than the 0.8865/85 levels for the closing week. Once this occurs and moves lower; the GBPUSD would gain momentum to move higher contrary to a Euro being steady to lower on a day to day basis. However, the inverse H&S formation for the Euro would only be contradicted with a continuing lower prices towards the 1.4285 price levels. That means a move for the USDX higher above the 75.10/20 basis point; which may not occur for now.

USD Trend Continues

2011-08-23T03:18:00.000-07:00

The US dollar lost its closing recovery steam after the closing Friday and continued its weakness in the European session heading for the North American trading. The US dollar index have lost ground and currently working at the 73.65 basis point. A breakout of its trading range would occur soon enough, although when the exact breaking point would be difficult to anticipate. The vulnerable 72.90 would be easily taken out as the corresponding European majors likewise continues to rally on.

Meanwhile, the EURUSD and the GBPUSD also headed higher currently at the 1.4471 and 1.6560 respectively; gaining momentum towards the start of the week's trading. The average swing trading range on a daily basis within the past weeks have maintained at least between 100-150 easily. Where a struggle between bulls and bears can be seen in the price behavior. A break higher for the GBPUSD and EURUSD would not be surprising the way price behavior is moving at current pace. So far the European pairs are taking the lead targeting the previous registered highs from the past month of June at the 1.4650-90 levels and 1.6720 levels respectively. Momentum and volume build up would trigger this targets.

Technical bull spreads between the Euro and Pound can be seen more during the closing movements of the past weeks; as the struggle between the institutional and speculative players have been mixed. A European or an American shake out would occur before the actual break of the trading range. A confirmation and follow through from the prices higher for the daily Euro would justify its complex daily inverted head and shoulders formation and a weekly bull chart still intact for this move. However, the likely scenario and market conditions is more towards the GBPUSD.

This has been keeping the EURGBP cross at bay and maintain a stronger psychological support price at the 0.8660 firm. With a low risk tolerance levels at current prices of 0.8721; an anticipated move lower still would not be discounted as the candlestick formations are not as convincing as the GBPUSD in itself. Although. the overall picture for the EURGBP cross is still bearish from its previous highs of 0.8880 resistance price. Earlier shorts at the 0.8990 high would may well prove to be the major resistance chart and price wise.

Forex Analysis: USDX-EURO-CABLE-EURGBP CROSS RATES-LIVE

2011-08-18T14:11:00.000-07:00

Technical Perspective - SRO - Majors/Cross Rates

2011-08-15T11:07:00.000-07:00

With the continued uncertainty of the directions in the financial markets; a technical perspective of the chart formation for the European currency pairs and the USD Index would be appropriate at this time. Setting aside the fundamentals for the time being; the USDX has moved lower back to the 73.80 levels and the bearish outlook on a day to day basis remains strong. These levels on a weekly Stochastics/RSI overlay proves to be vulnerable for a near term directional trend lower that would threaten the support levels. We, however would not be surprised whenever this happens prompting our trade team to take a speculative trade in anticipation of this market movement.

An inverse reflection is found also with the EURUSD chart formation. And the anticipated move shows the recovery of the Euro and the British Pound as heading North and may build momentum / volumes for the next few trading days ahead. currently at the 1.4439 and 1.6385 as of this writing. Although, the degree of difficulty has not change at all and the continued volatility would be seen ahead where a probable breakout would occur between the Euro, Pound and the US Dollar simultaneously. This market analysis would have to consider the Euro to react on the GDP numbers for the 2nd qtr.and the ECB as well.

The weekly MA-Long Divergence more the EURGBP Cross rate has indicated a positive tone for technical trades to be implemented prompting the influential movements for both the Euro and Cable to move higher. Although, we are inclined to believe that this has been a speculative curve for a probable weakness of the USD moving forward. No such confirmation however, it would be priced-in when the US dollar does move lower.

We would still prefer to cross trade the Pound, Euro with the cross rates at this time but would not disregard the Japanese Yen and Swiss Franc. Although, both currency pairs have to be treated as isolated cases since the fundamentals are entirely two different situations compared with the European and US market conditions. Meanwhile, the opening price gap of the USDCHF in the Asian sessions where technically sound and in line the previous candlestick formation encircled on the chart that already showed a signal of price reversal before hand. With the market sentiments from the SNB contentions of taking similar action in the market whenever necessary shows its grip on the recent prices. With prices opening at the 0.7898/00 from a Friday closing price of 0.7767 should not be discounted. the market price movement is critical for the next couple of trading days. However, a retracement or pullback is expected and this would have been a technical adjustment from any oversold areas for the past few weeks of bearish price direction.

Access to Primary & Secondary Markets

2011-08-13T03:28:00.000-07:00

Forex Trading Methodology2
Access to secondary markets are essential elements of a successful investment strategy. The degree of trading difficulty can be eased by having the accessibility to enable proper money management and hedging strategies that would lighten risk aversion and appetite in trading any financial markets. More particularly the Foreign exchange markets where volatility will always be ever present.

However, the ability to do so may be limited to other investors and traders alike if and when such information to meet the necessary requirements would not be suitable or readily available. As some investors do have to meet certain criteria in portfolio management by these financial institutions. These may certainly apply for some main street investors in the Foreign Exchange market where the level of sophistication in accessing secondary markets for that matter may or may not be to their liking. As it would entail costing more than what is already available and would still have no specific guarantees that a loss would be avoided.

The distinct and number 1 advantage of the Spot Foreign Exchange market is the high liquidity that it really provides the market. There are distinct advantages of other markets such as the Financial futures, Options and Forward rates openly available but the 'how to' manage the combination of these instruments into a more reliable earning mechanism that prevents other to apply is the crucial part. Although, being able to apply these strategies as other interbank strategist do; only depends on how much one would improve and find time to do due diligence on their market knowledge and skills to the next level of sophistication in trading these exceptional conditions today.

When a combination of trade decisions are made for speculation or an investment strategy, either way some are based on a Political outcome or simply economic fundamentals. And some are on technical foundation seen in the market place.
A complete article version is posted on our website at http://megatrade101.com/

Market Tight Squeeze - Forex Majors & Cross Rates

2011-08-10T09:33:00.000-07:00

As speculative traders/ investors of European majors have been squeezed with the roller coaster ride between institutional participants. With the markets ability to find bull and bear spreads where the volatility index continuously increasing daily; the battle between bull and bear traders in Europe have tighten their grip with investors in the North American sessions even after the Fed willingness to stay its course for rates lower until 2013.

Renewed Bond purchases have been the norm for the market investors contrary to the S&P's downgrade for the US; thus pushing the USDX to another rally after touching a 73.82 low and currently reaching a 74.75 lower high compared with the previous 3days high of 75.38. However, what is equally important is the ability of the USDX to stay above the 74.40-75.10 range for the week ending Aug.12 and the coming weeks ahead. These are the key levels to watch for the US Dollar Index; while the Gold prices is currently making a new high at the USD1797.87 as of this writing.

Apparently, with the Dow turning south from a positive tone earlier have been a contributory factor whereas investors shift funds as the continued uncertainty continues. Meanwhile, to top is all is the current concern on French banks as concerns on their huge debt and raised concern by the credit rating of the country which led to bank shares to plunge in double percentage figures.

The EURUSD and GBPUSD are currently headed lower the same manner where they came from a positive tone and is at 1.4195 and 1.6175 respective levels. Other than their technical outlook; as most have noted that the daily price movements have been a roller coaster with gains and loss attributed tot he continued volatility of the market. These conditions are not for those players with a minimal tolerance levels and scalping opportunities may well be left alone for the time being. Wide price swings may be attractive for others but as we always say...the market will always be there. These are exceptional trading times and to out class these market conditions takes a considerable due diligence and strategies in place.

However, maintaining our bias sentiment further confirms the Intermediate Trend for the European majors and cross rates is still bearish. Timing market entries and exits may take a higher degree of trading skills and experience as the wild price fluctuations will trigger most stop loss as easy as it would do with profit taking.

Further gains for Yen and Swiss Franc in value is seen as it has been making from the start of the week. Even after the BoJ intervention needless to say. Would not be surprise to retest lower price levels for USDJPY rates as well. As the Swiss Franc already have done so. Lagging indicators on these market rates would not be as suitable with heavier fundamentals weigh in more than technicals. Of course, other wise risk appetite is bigger than playing a smart market well with these current conditions. Stay clear temporarilyy and wait for a good market timing on better conditions.

Trading Exceptional Times

2011-08-09T04:31:00.000-07:00

These are obviously exceptional times in trading the foreign exchange markets. As we all have heard the different yet negative bottom line scenarios from the Earthquake Disaster in Japan; how investors reacted to the price fluctuation of the USDJPY, the Sovereign debt crisis in Europe with Greece, Italy and Spain; with the ECB previous rate decisions to purchasing Government Bonds to ease the contagion effects on the EURUSD. And now with the S&P's downgrade for the US have left almost all financial markets from Stocks in the red.

These are exceptional times particularly in trading the financial markets; where the volatility index have reached their highs and where investors loss of confidence is overwhelmingly felt worldwide which can be seen on the market's performances worldwide. How does one investor and trader prepare to trade during these times of uncertainty? That is just one of the many questions that needs to be address before making any trading decision.

Focusing on the Foreign Exchange market takes more than simply buying/selling a currency pair. As the correlations and other factors affecting them are tied up to a lot of current global issues. Whenever such issues are 'Politically oriented and influenced' do expect an increase in volatility and a roller coaster ride from the three major markets. However, with these clouds of uncertainty hoovering in the air; the distinct advantage for those who has the conviction and the unbias outlook /analysis may well be in a better position to focus and sees a clearer perspective of the market trends. There will always be conflicting factors, thus making price swings erratically. Price behavior dictates price action as a response or a mere reflection of outside / fundamental factors. Market psychology does have an important role isolated from both technical and ffundamental analysis. And this can only be found on studying the price movements and behavioral patterns reflected by prices.

Trend following the European Majors & Cross Rates

2011-08-08T04:31:00.000-07:00

The initial reaction in Asian/ European markets have obviously been negative from the S&P's downgrade AA+ for the US. The continuing beneficiary is still the Gold market, as prices for the yellow metals have reached the USD1715.35/oz. high. While the soft opening for the USDX held at the important levels of 74.40 basis point with a short lived low at the 73.97. The trading range between 73.28 and 75.10 are critical points of its range where any particular break through the high above and maintaining a close at the 75.50 will build momentum to the next target levels. Of course, this is the speculative outlook for bullish USD players. As a rush to flight to quality USD Treasuries may be the catalyst to a bull USD market. However, this would be contrary to investor's current preference for Gold. As most central banks have done so by increasing demand for the precious metal. A slight inclination of a report for increase margin requirements for Gold may somehow spook the market at any given time. Nonetheless, these fundamentals and market trend may not go away that soon.

The EURUSD has been given a short lifeline from the ECB purchasing Italian and Spanish Bonds and lent support for the Euro for the time being. However, the overall sentiments remain uncertain for the market participants. Although, we still remain true to our bias sentiments for the EURUSD & EURGBP cross to move lower. Particularly the EURGBP were a retest of breaking 0.8660 for the 2nd time maybe attained. As the previous week's low did moved to 0.8642 low and met some liquidation, profit-taking for others.

GBPUSD would be steadier to lower as it paces with the EURUSD from hereunto. But the technical outlook for the GBPUSD on chart formations is still bullish. Thus providing support for the EURGBP cross to move lower in an orderly fashion. We have decided to stay the course for the EURO and cross rate as it has been our benefactor providing us with the additional equity built in through the past months.

Meanwhile, USDJPY has given its signal of a probable price reversal for the coming week as the MOF in Japan have continuously talking intervention even after their move last intervention in the market place. 76.28 again, is a pre-WWII levels which will be the basis of support from hereunto. Although, as we also mentioned these are exceptional times and where exceptional price action happen. In essence, we still would not be surprised if and whenever prices again make an attempt to gain Yen strength for a 2nd swing. We'll have an open mind for USDJPY and USDCHF for the current week and observe more closely price behavior for the European majors and USD movements. Any sudden changes may well be lurking in the market place even as of this writing.

FX Prices Re-affirms Trend & Price Reversal

2011-08-04T07:11:00.000-07:00

The BOJ's intervention re-affirmed a much needed boost for USD bullish institutional players in the foreign exchange market. The timing could never be better as the registered low for USDJPY at the 76.28 was pre-WWII levels, although the much anticipated intervention finally gave through in line with the SNB move the day before the intervention. Much to the surprise which normally would take the BOJ a weekend action, but the pressure from the inner circle of the ministry and corporate exporters have proven to add more to the market pressure with the price levels.

Asia market have proven to be a little more lenient as it waited for the North American Sessions to come forth and made its follow through price movement for the USDJPY reaching the 80.22 chart resistance levels before making it corrective move lower to its current price at 79.41 as of this writing. That prompted the directional trend for the GBPUSD, EURUSD to retreat back down to 1.6285 & 1.4151 low respectively.

Such moves have spilled over the EURGBP cross rate as predicted to the 0.8671 ( real close from our objective at the 0.8660 dated Market view Analysis on Aug.02" Bear Sentiments for EURGBP Cross vs. USD". The probability of an attempt to the May 05 low of 0.8610 would be made. However, remember no such prices do move straight down or up without any play in between supports and resistances.

The highlight that we would like to emphasize is that no amount of technicals would be able to determine market factors currently overwhelmingly influencing the market place. Over-bought/sold areas, Oscillators, and other techn tools are mere guideline to use but would not a real determining factor for final decisions as most are aware that they are most lagging behind market prices. Due diligence on Market Behavior and price actions may well prove to be more useful without the bias charting analysis and positions on trades at times.

Although, market forces play these price swings with no mercy to the underlying retail speculators when such occurrence happens a day before the end of the trading week. The force of the market price can best be gauge on the opening of the USDX today a the 74.41 from the previous day's closing price of 73.92 basis point. Of course, the closing prices were more taken by the negative reports on the US GDP and the overall sentiments of the market.

And with this said; it still does not change the overall sentiments of the where the biggest economy is heading to. With the unemployment figures may provide some directions and clarity. Again, not a lot are expected for tomorrow's figures.

However, the price movements alone have been significant as they already re-affirms our outlook and analysis from the Price and Trend reversal call dated the 15th of June 2011. The degree of trading difficulty is ever increasing that adds fierce volatility in the market, as price swings wider every day.

Bear Sentiments for EUR/GBP Cross vs. USD

2011-08-01T10:07:00.000-07:00

The initial reaction from the Asian & European markets prior to the opening for the US North American session on the stocks were higher across the board; yet the USD have been pushing lower with position adjustment for the new month are being carried out in the forex market. This is in response to the positive news coming from Washington of a deal made and avoiding the first -probable default by the US government.

That initial market behavior could well be attributed to major players price adjustments with the continued corrective move of the Euro with extensions at the 1.4452 high along side the 0.8803 registered high of the EURGBP cross rate. With so much negative sentiments looming in the airwaves prior to the opening the excitement on the floor could not be helped and get noticed while a price turn around for the EURUSD after the opening bell was underway. The next best question would be for how long would this USD recovery last?

Based on our previous market review dated the 30th of July; the USD Index below the 73.85 -74.40 range surely signifies a continuation of the bear patterns. However, maintaining our bias EURGBP short side of the market has kept our commitment to maintain the position and place corrective stops whenever prices do move higher. The initial break from the USDX range above the 75.10/20 basis point would provide a leg higher and a probable follow-through when volumes do pick-up. This could only happen whenever positive news would come from either the NFP and unemployment figures this Friday. Although, prior to this are the reports for the BoE & BoJ rate decisions and the earlier retail sales figures from the Euro zone that would be well anticipated. However, the earlier week's report on the US GDP would not be discounted overall and would weigh in if the figures would be negative for the week end. Which means that only a close for the weekending the 5th of Aug above the 74.45-75.10 basis point range would re-affirm bullish institutional players to build-up momentum in the successive weeks to follow. Unless, of course a negative report would prevail before then.

A complete report and analysis for the EURUSD and EURGBP can be found on our market view report on the website.

What FX Price Behavior means vs. Techncial Chart Analysis

2011-07-30T03:28:00.000-07:00

Focus on EURGBP vs. GBPUSD

The US economic fundamentals from jobs/unemployment, real estate prices and the recent revision on the US GDP didn't provide any follow through recovery for the US Dollar. To top it all these reports, the political gridlock in Washington added more negative sentiments among all the global markets from stocks to the foreign exchange market. And this has led the US Dollar as indicated by the USD Index to move lower to an important psychological support price below the 73.85 basis point. With a low registered this week at 73.42 may well be defined as the key levels where traders would have reacted to a heavier selling pressure for the US dollar. However, not a lot of investors, market strategists and traders are willing to take any fresh short positions with the US currency. And still opted to continue supporting the precious metals market as new historical prices are dominating this week's trading sessions making a new high at the USD1632.79/oz.

We have seen the spread /straddle strategies applied between bull and bear Foreign exchange institutional traders on Spot and futures have added the volatility on market reactions. Although, in between market sessions investors have learned to take a sideline attitude while watching and waiting for the outcome of a struggling political vote. And more importantly as to how such a play would be made on both sides of the market.

The European cross rate of the EURGBP has been more resilient to these factors; although the corrective move of the Euro can be seen more compared with a steadier GBPUSD making a comeback to the 1.6490 levels, while the EURUSD reaching a 1.4536 high from a 1.4228 low for the week ending the 29th of July, 2011. The indirect trading effect of the EURGBP cross pick has withstand almost all the swing trades and volatility on a session to session levels and maintained its trend back to the 0.8750 closing price from a corrective move at the 0.8883 high in line with the corrective move of the Euro.

The price behavior of the Pound and the Euro in a bigger techncial perspective have been more in line with its bullish trend. Meaning, that inspite of their low price extensions, have found some support to recover due to the fundamentally oriented market pushing the US Dollar to do the same from its recovery. As we have mentioned, that the critical price for the USDX below the 74.40 and 73.85 range levels for the week would reinforce its bear signals. And this is contrary to its registered high of 76.70 made during the 2nd week of July.
For a complete report and analysis visit our website at http://megatrade101.com/

Volatility Remains High

2011-07-26T02:27:00.000-07:00

The Political bickering in congress has led the instability on the market between bulls and bears. However, the obvious weakness of the US dollar is due to this indecisiveness of an agreement in raising the debt ceiling. Although, the repercussions towards the financial markets worldwide are known to everyone concerned. As the deadline nears this August, the market susceptible to wide price fluctuations are increasingly present. Certain surprises would occur before and after the designated time table and would make the financial market investors more jittery as well as excited for major players (institutions) participating in the current conditions. This is no place to trade for retail investor or main street speculative investors who would only get caught flat footed in their daily trades.

With that said, the USDX registering 73.52 low with an opening gap at 73.70 from the Friday closing of 74.10 basis point have shown its weakness in reaction to the stalemate not being able to reach a reasonable agreement. Although, the opening gap could be treated a long opportunity for bulls with a substantially large portfolio to take short trades and generate a short gap trade between trading sessions from Europe and the North American sessions.

As the EURUSD have extended its gains, so did the rest of the majors across the board including the Aussie and the Kiwi. The USDJPY and especially the USCHF have seen strength as the market have pushed the majors to their recent highs in value against the US Dollar. Although, the critical levels for the US Dollar is seen from its current low it now boils down to making the right choices as to which currency pair to trade with. A confirmation before a trade would be the likely choice for others as it really boils down to risk aversion and risk appetite to a certain degree for every investor and trader who would play these market conditions.

However, these market conditions are not close enough to the previous market movements when the GBPUSD moved rapidly down when John Majors walked out from the ERM, the Chernobyl accident that led Gold and even sugar to skyrocket and the worst drought from the Ohio Mississippi basin that led the soybeans market go haywire.

When all is said and done the normal market conditions would be more suitable for smart investors and taking a sideline to relax is a smarter way to go. Markets will always be there! so choose wisely!

Market Timing resolves Trading Difficulty

2011-07-18T07:02:00.000-07:00

The degree of trading difficulty for the Foreign Exchange Market for the past few weeks have been gradually increasing together with the kind of volatility we can see on the price action alone. From a thinly traded market during short holiday trading from the fourth of July weekend have been at a steadier pace of volume increases and momentum build-up / declines as prices narrowly gain and looses its gains, as it quickly did within two to three day spreads. With other traders / analyst caught in between the haggling reports from the rippling contagion crisis in Europe, causing the prices relatively to move in both directions on a day to day basis. Although, the trend still remains intact during the end of the trading week, where the trend is still well identified for the European currency pairs including the cross rates. And with minor corrective movements as we go along the way.

With this week's thin market reports on both sides of the continent; the obvious market sentiments from the previous trading weeks would be the same, until any real serious fundamental would point otherwise. With price action within a wider trading range; the degree of having a successful trade would depend on a properly executed market timing on entry and exit strategies. However, the risk tolerance should be well defined in advance, as this market would not be suitable for short term trades that barely have enough for a negative tolerance while maintaining the respective positions. As wide price fluctuations can easily trigger a stop on both sides of the trade. This also goes the same way with having an appropriate amount of funds to risk for a wide and volatile market. If not, please do not even bother to consider any risk in exchange for the thrill of winning big, which may eventually turn in to a total loss of trading capital.

However, the relative trading analysis of timing the market weighs more in any successful trade. A trade decision to go long or short for a certain period of time needs to be well defined. Using the shorter time frames for entry and exit strategies would be appropriate. And segregating the charts into a daily, weekly & monthly basis should be able to determine the overall position and not the other way around. As everyone knows that each and every technical tool being used in most trading platforms are lagging indicators that portrays the action after the fact. Staying ahead of a lagging indicator would surely improve the winning ratio in every trade.

Knowing how to calculate these indicators forward/backwards outside of the embedded chart indicators; the likes of the simplest and commonly used trading tool like the Relative Strength Index (RSI), Moving Average Convergence /Divergence and George Lane's Stochastics would be very useful to know. This certainly would be a way of staying ahead of the competition; so to speak with other market participants when trading actively in the market place. By the time most traders would be coming in the market from their confirmation, you would then be coming out of the market ahead of the pack.

Although, the orientation of each trader and investor differs from one another. And knowing where one's comfort level of risk appetite and tolerance can only be enhanced by improving one's skills in trading by due diligence studies and obtaining the right information from reliable resources.

European Majors weak on Contagion

2011-07-11T23:21:00.000-07:00

The crisis on Greece and Italy has weighed heavier versus the US unemployment data last Friday that led the current directional trend lower for the Euro & the British Pound. Frantic investors shifting to the US Dollar for safe Haven and flight to quality have pushed the US dollar Index higher and have penetrated its initial trend line resistance above the 75.08/50 basis point level range.

Increase volatility have made other traders reluctant for the past week and month's trading to create further positions on both sides of the direction. As the past week's move for the EURUSD has tapped the 1.4566 level highs where a lot of bullish speculators have been holding their positions leading to buy in any price lower for the Euro. Unfortunately, the bearish signals were there except no one have anticipated such bearishness to make a follow through until it continued to move lower on the first trading day of this week.

On a technical perspective, it has been the USDX compared with its inverse counter part of the EURUSD was more identifiable where one could see the three piercing formations made from the past few weeks. And this can only be seen on the weekly charts of the USDX vs the EURUSD & the similar configuration with the EURGBP cross rates. Apparently, the 1st initial support from a rising Fibonacci fan formation for the EURUSD is at the currently low of 1.3910/30 and thereafter is the 1.3750-1.3880 range trading; where we would find some profit-taking may take place from earlier shorts from the 1.4180 previous support price levels, now the 2nd resistance from the 1.4080 price levels. An average trading range between 120-150 pips up and down price swings can be attributed to the increase volatility currently present in the market place.

A complete report is found on our website: www.megatrade101.com

Trend Following EUR-GBP Live.2.

2011-07-11T06:02:00.000-07:00

Volatility increase after 4th of July

2011-07-04T01:31:00.000-07:00

Not much market activity would be seen while the 4th of July weekend is celebrated. Apparently, thinner market may often be susceptible to wider price fluctuation soon after the holiday trading and the upcoming NFP and the ADP figures which some analyst attributing a slight pull back for unemployment numbers. Likewise , the continued discussions on Greece selective default are weighing on the market, although resolutions to these problems would be on the table for further discussion to avoid and actual defaults by Greece. But the highlight for the week would focus on the NFP figures.

Trading Strategies: Much of last week's market movements were clear, although, the much expected US Dollar decline were attributed to the strength of the Euro recovery as declining Gold prices and oil have contributed to investors shifting interest for the Euro rather than the precious metals. But in spite of the declining metal prices, it has not helped the US Dollar to continue it strength but rather maintained it gradual decline relevant to the weak data from last week that prompted the continued strength for the EURGBP cross rate to move back higher to the 0.9010-60 range levels. Thus supporting our market view report from last week's outlook "Focus on the EURGBP Cross & the EURUSD." Please refer to our video support for this market analysis.

The Asian opening lower for the the USD would continue to have a spillover effect for the mid-week prior to the NFP figures. Leaving enough room for the corrective move although, seen on a short term basis on a daily price movement for the European majors like the Euro. Currently, at the 1.4527 maintaining a fairly flat price due to the current market inactivity from US major investors. Whenever such corrective movements are made we, would be expecting a corrective move midway to an engulfing candlestick bar for the weekly for the Euro coupled with a EURGBP cross rate to move lower towards the mid-price range of 0.8860 or lower levels. Thus making a a bearish signal by the end of this week's trading activity.

The relative contrary movements from between the USDJPY & USDCHF may also be a influential factor for the Euro & Pound to likewise do similar price actions on a day to day basis heading towards the mid-week's trading activities. With the opening of the new month for July, position adjustments would be made clear before any real fresh position trade would be expected for the major participants. Besides, being the beginning of the 2rd quarter of the year's trading, whenever a mid-year ends with the USD lower a probability to follow its cyclical pattern to recover for the third quarter would be logical.

Thus maintaining our long term objective with a long term position for the USDCHF to make a come back. Choosing the USDCHF has been preferred rather taking the USDJPY. As a cross trade in the near future we would consider choosing the between the EURJPY and GBPJPY to maximize the market potential of our USDCHF long term objective as shown on the chart above. As such, positions taken would relatively depend on the size and allocation of trading portfolio that one has. However, we do not recommend that this strategies be applied for retail investors as it carries a higher degree of trading difficulty and risk tolerance to maintain 2 or three simultaneous positions in the market.

Focus on EURFBP Cross & EURUSD Live

2011-06-28T08:52:00.000-07:00

Focus on the EURGBP Cross Rate

2011-06-27T08:34:00.000-07:00

On a technical perspective the daily EURGBP daily chart formation has all the typical bullish signal in spite of the double top formation that it has been showing including the weekly formations. However, with the continuation of the volatility in the market, not to mention the back & forth scenario establish with the European debt crisis just adds to the wider price fluctuations seen through out the past few weeks.

Now with that said, the irony of the matter is that the idiosyncrasy of the GBPUSD / EURGBP has time and again been proven that such a formation would otherwise move to the direction higher than most would really expect. Currently, with the EURGBP taking its steps further higher is at the 0.8926. With a steadier Euro from fundamentally supported by iad for Greece ( for now) again have been quite supportive for the cross rate as well. The reaction counter to the USDX corrective movement at the 75.50 from a 75.96 high made it happen. The EURUSD steadier to normal higher move with a secondary move lower for the GBPUSD would fuel the next leg higher for the cross to attain it initial objective above the 0.9010 or better. Depending on the volumes and momentum build up would determine the time frame that this move would hold for the time being.

Plus the 'Rising Three Methods' identified on the candlestick formation would trigger technicians to re-establish long EURGBP positions the same way we have done so. This strategy is applied to maximize the profit and market potential of the EURGBP strength, with slight to lower corrective moves for the GBPUSD to fuel the direction higher. While the EURUSD holds just above the 38% Fibonacci rising fan formation as indicated on the chart. This has been our simple approach applied whenever such typical candlestick formation occurs. Keeping the short with protective trailing stops to liquidate/settle our shorts on the way up; while maintain a cross trade long ( short term daily basis) on the EURGBP to cover the probable loss on floating pips on the GBPUSD. Thus maximizing the market potential on both directions without having to sacrifice the quality of trades made from the past week of June 07 to the current time frame involve. Please refer to our continuing market strategies applied from June 07 from our market view analysis and the corresponding chart formation and video supporting these technical applications. However it may be, as the strategies made are with a substantial, managed and appropriate funds portfolio with a well defined risk appetite to follow whenever the opposite occurs.

3Comparative Charts EUR-GBP Live

2011-06-23T23:58:00.000-07:00

Euro reacts on Confidence vote!

2011-06-21T15:31:00.000-07:00

As the market anticipates a crucial decision for Greece government led by PM Georgios Papandreou will survive as he revamped his cabinet to make certain that a continued support for austerity would be made. That is inspite of the continued strikes and protest against the programs. This has prompted the EURUSD to move higher to 1.4432 and the cross rate on the EURGBP to move back upwards to the 0.8883 high respectively. Yet, the unconvincing rally can only be considered to be a correction from its low; as no other significant momentum build-up for the Euro to move further was indicated. the only exception was the negative figures on existing home sales that added to the USDX to move lower back below the 75.05 near term support price level.

With commercials still dominating the market place, we do expect a continuation of this near-term rally on a daily basis with wider trading ranges that may run out of steam nearing the closing of the month's trading. Although, the FOMC and the EU June 23-24 meeting would be dictating the direction for the market by then leaving a much wider room for volatility to increase significantly.

And even the precious metals and stocks have been the beneficiaries of this continued market condition after experiencing a roller coaster ride from the past week's trading. With Gold prices back up at the USD1550.00 levels from a low at USD1510.45 and the Dow Jones at the 12190.00 levels.

Weighing Fund vs. Tech

2011-06-21T06:09:00.000-07:00

Fundamental:

As volatility continues to increase speculative trades has been much lesser due to the wider trading ranges of the majors. This is equally true to the back & forth resolutions and market activity in the Euro Zone with Politics playing a greater role in determining the direction for the Euro. Meanwhile, the relief rally on the stocks have been seen with some reluctance from investors as the net change of the economy has not been that convincing. In spite of the USD recovery, a slow yet gradual momentum is still building for that much awaited USD rally from the past week that has led the Euro and the British Pound to move lower.

Although, a slight recovery is being made from the opening of the week's trading, the main focus would be the EU debt crisis weighing in on the market. Since the economic calendar for the US is fairly thin except for the existing home sales data expected. The upcoming June 23-24th meeting of EU leaders is being monitored well, as everyone is transfixed with Greece and their vote of confidence would help and ripple through the financial markets.

Technical:

Analysis back from the previous COT as released by the CFTC last June 14th; commercials were more prominent players in the market than that of speculative transactions and non-commercial participants. That is the very reason such volatility has been present were such position adjustments are made transforming a wider transition of prices from the previous highs of the European currencies and the lower US Dollar that led to the rapid recovery as seen from last week's movement. Keeping pace with commercials with speculative trades would be more risky as retail investors and traders would not have access to these information only after the release of the COT at the end of each trading week. The Volumes and Open Interest in the futures market would be a substitute although would not be able to replace the COT as it has more vital data/information to see. As almost all technical indicators are lagging behind and such confirmation remains after the fact or the market prices has moved.

Pls refer to a complete report and chart analysis in our website: www.megatrade101.com

FX Confirms Price & Trend Reversal

2011-06-15T10:35:00.000-07:00

The catalyst igniting the USD rally for investors flight to quality investments and position adjustments were simply derived from the EU crisis where its ripple effects on the stocks, combined with the political rampaged of protesters fueled the EURO go move much lower than most have expected. However, the mixture of reports from the US side didn't do much to help from the start. That is why we have mentioned before that the market's condition and behavior has been more on the fundamentals on the EU sovereign debt crisis again that has been taken the limelight from the market.

Although, the yellow metal has had a roller coaster ride from its low price levels of USD1,510 - 1,540.00 trading range adding to the turmoil of the market participants. Especially with the recent report from the COT whereby a majority of open interest for long Euro may obviously been scrambling towards the exits as prices continued to move lower back down to the 1.4180 and 1.6180 respectively for the GBPUSD.

Meanwhile, the USDX has garnered enough momentum from its recent correction of 74.38 and is currently at the 75.50 bp as of this writing. True enough, the price reversal was indeed the first signal where the initial bottom for the USDX is now at the 73.15 -74.20 range levels called from our recent market view analysis dated the 07th of June 2011. And this was initiated with a speculative trade short on the EURGBP and GBPUSD. Simultaneously, hedged with along USDCHF at the 0.8378 levels. this has been a strategy to be able to maximize the market's potential on both directions of the trade. Although. a bit more expensive to maintain as increasing risk appetite were made based simply on a pre-calculated risk factor where the USD was too close from its all time low levels. Please refer to market view analysis dated on the above date of the 07th of June for a complete report on our website.

Do expect that the rest of the week's trading towards the month end would be a bit more favorable for USD bullish players with wider fluctuations for the currency pairs from hereunto. A long as the USDX would maintain its levels above the 75.05-50 basis points plus other fundamentals favoring a flight to quality position trades against the Euro then expect a build=up of momentum, increase in open interest and volumes in the next few weeks of trading activity. Of course, there will never be any real guarantees whenever one deals with the volatile currency market. Exercise caution and sound financial advise before taking such risk.

USD, EUR, GBP Volatility Increases

2011-06-14T00:12:00.000-07:00

The market's price volatility on giving back its gains and losses has been the norm for the past several weeks with an average true range of about 120-150 pips on both directions of the market periodically done on a daily basis. As this also has been the trademark of institutional players dominating the market place.

Apparently, as seen on the corrective move on the US dollar Index touching a key point resistance price level of 74.80/90 basis point; have retreated back down to the current 74.40 corrective move. However, a second attempt would not be discounted on the next leg up as it gains momentum from position adjustments and fresh incentives for the coming week. Timing is obviously important. However, a struggle between bullish & bearish players between hedge funds and institutional banks has been dominant in the market place with a small percentage of speculative players barely surviving the wide trading range for the past week.

As the the USDX moved higher the previous week have pushed some forced liquidations from sellers turned bullish players of the EURO as the prices turned around reaching the 1.4321 from the previous registered high of 1.4695. currently, the EURUSD has turned around back up towards the 1.4458 as of this writing. And subsequently with the GBPUSD at the 1.6429.

The lack of synchronize trading price levels from the rest of the other major pairs have led to this correction while rebuilding the momentum for a follow-through in volumes have diminished open interest to increase. Unless some fresh incentives would lend to support the recent upward US Dollar rally then the obvius retreat would still maintain. Although, we would be watching price and market behavior more closely for any signals that may state otherwise.

For a complete report and analysis; pls. visit our website: www.megatrade101.com

EUR /GBP Price Reversal

2011-06-10T08:38:00.000-07:00

Bloomberg's survey of market sentiments in stocks and the overall economic outlook have been more on the sluggish economy from jobs, housing and consumers feeling the pinch on commodity prices including the cost of oil causing a spike on the gas pumps have limited the market the ability to sustain its growth. With stocks tumbling to its support levels on the 12K levels made it all possible for traders to short on rallies.

However, the real cause for the European currencies to move lower was the arguments between the ECB and the other European leaders on the debt crisis. It has affected the Euro more than seeing a strength on the USD. Which obviously have been the case. In spite of the negative numbers from last week's report still prompted the USD to recover for a very timely. manner. Although, this does not assure a true trend reversal but it does have a good basis of a technical bottom price for the USDX at the 73.10/50 basis point and support levels. Currently at the 74.32bp have given a much awaited and reluctant traders to call this move a true reversal. Of course until such time whenever new lows would appear at the closing of next weeks trading.

However, talks of QE3 has been minimal but it has been up in the air from most of the news reports. But for the time being, the end-result for the EURUSD, GBPUSD and the EURGBP to move lower is in the making. And in line with the cyclical patterns ending of the 2nd quarter has been in the watch for sometime where a USD recovery is expected. Against all negative market sentiments for the US to recover overwhelmingly prevailing in the market place.

With that expectation, risk of shorting GBPUSD vs. our EURGBP cross would be a more likely strategy to protect the gains made while taking a short term Long on the USDCHF as a net position. With a very minimal risk on fresh new position to go long at 0.8378 USDCHF is well worth it comparing its historical price levels regardless of any market condition. A more speculative decision in the final event where momentum builds in a short term basis where the US dollar is showing it color as of the moment.

USD weakness continues

2011-06-07T04:49:00.000-07:00

The highlight on Fed Chairman Ben Bernanke would be then main focus on assessing the US economy. This would be two weeks before the Fed policymakers would meet to discuss interest rates and their monetary policy. Which apparently would also focus on the coming end of QE2 this June. With the signs of negative sentiments due to the sluggish economic growth with higher unemployment figures does not rest well with the USD. The continuation of its weakness and the some EU leaders political resolve in helping to provide more support on the European crisis have helped the Euro advance its price levels even as of this writing.

Contrary to what other analyst and retail FX traders say that this movement is a correction from its downward trend is actually the opposite. As others have taken an earlier short position starting at the 1.4350, then to the 1.4550 and is currently at the 1.4660 levels. By the time it touches the 1.4880 price levels again then that's the time that they would change their sentiments to a more bullish tone.

We have maintained our stance from its major corrective movement and a price reversal back to it major trend at the 1.3968 low and closing above its 1.4280/00 the last two weeks sessions. However, the cross rates on the EURGBP has had more of a distinct configuration that we called a continuing bullish trend back to the 0.8900 or better since it also did the same corrective movement together with the EURUSD. Currently, at the 0.8920 levels from a registered high of 0.8944 at the start of this week's trading. Some unexpected pullbacks would be seen, as position adjustments and forced liquidation would take place within this week. As some earlier sellers on the Euro would consider throwing in the towel whenever a new high would register.

A mixture of sentiments would prevail after the GBPUSD showed some initial strength at the start of the week compared with the GBPJPY attaining its initial price objective lower at the 130.64 neckline support. Eventually, this support may also be retested but may meet some hedge strategies once penetrated to the low as USDJPY may do the same. This week's trading activity would be critical fro the Japanese Yen vs. the Pound and the Euro. So a careful watch should be taken.

Trend Following EURGBP /GBPJPY

2011-06-03T03:31:00.000-07:00

The established trend from the major pairs such as the Euro and the Japanese Yen has made it all possible to follow and trade within it major trend, setting the pace for a renewed strength on the cross rate of the EURGBP in particular. Mixed reports with a continued bias for a USD weakness lent support for the EURGBP to go back to the 0.8890 from a pull back corrective move down to 0.8610 major support levels. Price reversal signals were eminent through the bullish candlestick formation that started the week of May 22, 2011

Unfortunately, call of a market reversal were seen all over the market place with talks of the Sovereign debt problems of Greece contributed to the negative sentiments for traders to short sell the currency pair. As the short-lived recovery for the USD also lent support for more sellers for the Euro. However, our market view report on the 'Major correction within a Major trend' has always been the basis of consistency to maintain our overall sentiments of a continuation of the Euro and the British Pound to continue its upward trend.

The Chart above shows the indication of a continuation of the upward trend by the EURGBP from its 0.8610 price reversal. Meanwhile, the current price as of this writing is at the 0.8881, slightly above the 50% Fib of its major correction trading range.

The contrary movement of the GBPUSD lower correction due to the negative report in UK and the remarks by Trichet for the Euro; lent the support for the cross rate to confirm our speculative move to go long for the EURGBP and an equivalent short hedge for the GBPJPY as indicated on the right hand side of our article. Currently working at the 131.70 low from a high of 135.10 resistance levels.

Some expected pull backs may occur as closing of the trading week and not a lot of positions would dare be establish by now especially NFP figures are expected.

EUR, GBP vs. USD gains momentum

2011-05-30T23:53:00.000-07:00

Spillover on Crosses

Figures on German unemployment were better, the upcoming US and European data on consumer confidence and Non-farm Payrolls may find some friendlier support for the US dollar this short trading week schedule. Although, mix to negative may prevail for housing and US consumer confidence due to the continued oil and gasoline prices currently hurting most American consumers.

Apparently, the fundamentals on the European sovereign debt problems have eased-off. As European leaders have made their stance clear on providing a second package deal for the Greek problems that would eventually lead to Greece meeting its scheduled payment options without the restructuring program.

But the main headlines of Japan being downgraded have a more direct effect on the crosses rather than that of the USDJPY with only a meager trading range and working at 81.69 as of this writing. the obvious seems to unwind other major traders to checkout the crossess as they have more market potential with accompanying volatility as seen on the prices of the GBPJPY & EURJPY.

However, even without such reports from last week's price movements, the strength of the Euro & Pound have made it clear that the actual market sentiments on these pairs were still bullish. Pushing higher to the 1.4406 levels for the EURUSD and 1.6545 for the GBPUSD respectively, has maintained its consistent market momentum thus far. This also included the price reversal for the EURGBP cross rate to change its tone from a low of 0.8610 trend line support. A confirmation from the daily candlestick inverted hammer of 5.26 also lent support for the directional price change that is now signaling a continuing upward price movement.

The spill-over sentiments carried through the EURJPY & GBPJPY crosses as the upward momentum increases for the start of a shorter trading week. EURJPY is currently at the 117.45; while the GBPJPY is at 134.96, a clear breakout from the 133.20 levels. Expect some pullbacks along the way.

Please refer to complete report and analysis on our website. http://www.megatrade101.com/

Economy outweighs QE2 & European Contagion

2011-05-27T08:44:00.000-07:00

USD Lost ground!

As of now, the negative figures and mix reports from the unemployment claims, retail sales, GDP, the housing / home sales figures and specially the consumer spending missed it numbers have led the US Dollar to move ever closer to it second smaller wave lower as we have expected. Although, the timing couldn't have made it better as the US market prepares for a long holiday weekend and the closing / opening of the month of June is in between a squeezable shorter & tight trading schedule for next week.

As most analyst have been eyeing on the market reversal for the US Dollar with the end of the QE2 prompting a positive tone for the US dollar to strengthen further. However, as much as we wanted to be convinced, that major corrective move higher for the USDX was merely a signal that it does have room for a recovery. But in any major trend there is a major correction occurring within. The same is true with the EURUSD & GBPUSD respectively, which still is within it true bullish trend. However, the only reason why they have been correcting is the European debt crisis and the previous negative statements from Eu officials prompting the Euro to move lower. Making market sentiments to shift from time to time as the consolidation, wider price swings and fluctuations were made to confuse the market participants.

As we have been caught once to earlier due to the degree of difficulty in analyzing the timing rather than the market trend direction. However, the true sentiments still remains the same, based on our May 24th market analysis that the European currencies are still heading on it northernly directions higher. And the signals and confirmation came through on the 26th of May. Although, the end of the month will fall on a Tuesday were most traders would not make any serious decision in the market.

Now with that said, the crucial closing for the month and the succeeding trading weeks in the next two weeks would likewise be critical for the GBPUSD and the EURUSD to have another major correction within as the end of the 2nd quarter comes simultaneously with the end of the QE2. However, market sentiments would prevail by that time and a lot of our traders out there loves to speculate a market trend reversal ahead of time. The trading activities and price behavior for the coming week would be a pivotal point as to the trend's directional movement. Although, we have some market outlook in mind already but would rather wait it out until the week's trading ending the 3rd & 10th of June, 2011.

Please watch for our next couple of market view reports regarding the market on our network site.

Increasing Market Volatility

2011-05-24T04:05:00.000-07:00

As prices swings in both directions.

We have mentioned in our previous market view report as of the 17-22nd of May's updated analysis; that the market prices would have to be giving up its gains / losses and would create a consolidation pattern for the month of May. Please refer to our "USDJPY & USDCAD still taking lead' review which the market prices has been persistently been swinging in both directions.

Although, the strengthening USD has been more influential, the up and down swings were more reflected on the foreign currencies rather than the US Dollar index as it maintains it levels at the current 75.95 from a registered high at 76.36 basis points.

While the EURUSD made a slight recovery back to the 1.4091 from a low of 1.3968 which apparently so did the GBPUSD from a low of 1.6056 and is currently working at 1.6145 as of this writing. This has indeed influenced the cross EURGBP from an unexpected low of 0.8662 and is currently at 0.8723 recovery levels. this would prompt some re-positioning as it may now have some legs to continue its directional movements higher from the lower extension. at least an average of 125-200pips on the average wide fluctuations on both directions. Giving up gains/loss has been a norm for the prices. And this may go on for the rest of the month regardless of any dramatic report.

Although, one thing is for certain that such wide fluctuation would not be suitable for retail traders not unless a bigger tolerance levels with the right amount of trading funds would be utilize. If not we do advice to stay out of the market place if such appropriations would not be met. Currency correlations and cross trading amongst majors, cross rates and options are the best known and open strategy to be able to be success in this type of market conditions. Again, as we mentioned that the degree of trading difficulty should be measured well as increasing volatility would always be present at this point in time.

For the time being, the EURGBP, EURUSD may tend to fluctuate in a wider corrective mode as market shifts and position adjustment towards month end and new month opening prices would contribute more to this volatile market. As the EURGBP has a more northernly direction as it continues to have apositive tone due to the recovery but not of the USD but more of the EUR vs. the GBPUSD. Remember, that major financial institutions use other foreign currencies to do their transactions other than the US Dollar by itself. As major banks have international currency exposure vs. the US dollar with varying rate differentials.

Checkout the complete report on our website!

Have a good trading week ahead!

Strategic FX Trading Techniques

2011-05-21T10:39:00.000-07:00

Market Analysis - SRO

2011-05-19T00:32:00.000-07:00

The uncertainty of the market participants could be best described across the board based on the price behavior currently viewed in the market place. Setting aside for the time being the other fundamental factors surrounding the market, one would be view it as a waiting game for breakout prices to occur. Although, the overall sentiments derived from the previous market movements of recent days compared to the previous weeks have certainly been subdued. The continuing analysis has been a bit more challenging, since the market prices would never really show its actual intent ( next directional price movement). Even with the combined technical tools available, the uncertainty will always be present in the market place. However, a well informed investors' decision or analysis can only lead to a calculated speculative action best described weighing the risk/reward ratio in a given period of time.
The probability of an increase market volatility would occur depending on the interest and intense activity made by the majority of institutional players rather than the main street investors is no comparison to say the least. With that said, from the most recent COT report the overall shift of interest and volumes have been identified from the key price reversal established from the US Dollars higher directional move as to this writing. Currently measured by the US Dollar Index at 75.30 basis point; it now has more room to re-adjust lower and re-test its lower band before a real trend reversal could occur. And in addition, a second wave of volume and open interest increase can only justify this key turn or pivotal price point for the USD to be more convincing.

For a complete report, visit our website at http://www.megatrade101.com/

USDJPY & USDCAD taking its lead

2011-05-17T04:17:00.000-07:00

Almost every analyst & trader have been expecting prices to move higher along with the US treasury yields before the end of the QE2 as the Federal Reserve allows it to expire by June 2011. True enough in an ideal situation in anticipating a higher US dollar move against the major pairs. Today's highlight have been more on the USDJPY not because of this reason, but more on the reaction and influential movements of the cross rates particularly the GBPJPY, AUDJPY & the EURJPY.
With price comparison between the majors and cross rates almost all daily chart formations have signaled a friendlier upward direction which has given a much needed relief recovery for the majors after the recent downward movement of the past weeks. While these corrective price movements may seem to be sustaining in today's trading sessions, other traders may still find some reluctance to take a speculative position in the market. Nevertheless, as most traders have been eyeing a short on rally for the Euro & British Pound for that matter. These has been the general sentiments amongst traders and dealer recommending analyst seen in their blogs and market review.

The current month for May and the succeeding weeks of trading would be more of a corrective move from the down turn of prices with a subtantial wider range of price fluctuation. What this all means is that any particular recovery would be a relief recovery and would eventually end up with some consolidation patterns towards the end of the month for May. Although, this would be good for swing and day traders with smaller increments to take from the market. The daily fluctuations between the three major markets would more likely give and take its individual gains and losses even before and after the BOE & the FOMC minutes of their meetings within this week. However, we do have to see how the USDJPY may lead the forex market with its current showing even before the 1st Qtr. release of Japan's GDP.

USDJPY is currently at the 81.58 after registering a high at 81.79 initially. Meanwhile, on the technical front the 4hour chart formation of the USDJPY already did provide the price reversal signal at the 80.75 mid-price levels after consolidating within the Ichimoku Senkao span cloud and a cross over occurred on its way higher and above the 81.05/10 levels. These are the typical incremental movements that we are referring to unless a build-up of momentum and a considerable increase of daily fresh volumes established in the financial futures in line with the current spot & futures market correlation.
For a complete market view analysis; click on the link to go to our website: http://www.megatrade101.com/

A Basic Hedging & Spread / Straddle Strategy. . .

2011-05-11T23:05:00.000-07:00

. . . between Spot & Futures Market

Patience is indeed a virtue especially when it comes to waiting for the market prices move to a bias direction higher for the US dollar. Apparently, the as every trader / investor is looking forward to the Friday's report; market participants have already absorbed the inflationary effects and analysis from other indicators. However, the price fluctuated with a wider range including the GBPUSD which made a recovery up to 1.6515 that led to a corrective move for the GBPJPY as high as 134.02; wherein the key price to watch is at 133.65 on the recovery levels. Although, currently working at the 132.50 would now continue to make another attempt heading south to the 131.00 in anticipation before the news on Friday.

As the US Dollar Index is currently above the 75.05-20 bp would be gaining its momentum on speculative longs by institutional ahead of the report. If so, staying above these levels for the week would ignite a renewal for US Dollar bulls to dominate the market.

As it has reflected on the major pair that we have chosen & executed to hedge with the USDCHF (Spot Market) last May 05 @0.8607 long an equivalent to the USDX long @73.05 basis point (ICE Futures/spread & straddle strategy) versus an earlier short-sell on the GBPJPY @134.53 Therefore, the key levels to watch for the closing prices would entail the USDX to close above these levels to maintain a positive tone for the succeeding weeks to follow that would lead to a probable trend and price reversal confirmation. Which includes volume and open interest build up on the futures market as well.

These strategies are made more to maximize the market potential of the position and using the leverage / overall positive net positions to assure the strategic technique in protecting the gains against any possible adverse price fluctuation in the event of a surprising fundamental news that may otherwise do the opposite. A bit more expensive to carryout but investment well made based on a carefully planned and executed trade. Please refer to our market view & analysis report dated 6th of May 2011: An Effective Forex Trading Strategy on our website at http://www.megatrade101.com/

Price Page Indicator & Market Psychology

2011-05-09T09:04:00.000-07:00

Price Page Indicator's Market Psychology

2011-05-09T06:00:00.000-07:00

The signals derived from the Price Page Indicator that has again proven its reliability from where the basis of the trade positions had taken shape even before the remarks from the ECB holding rates unchanged came about. The so called rumor from Greece's intentions of pulling out from the Euro currency really had no bearing except that it was highlighted by some analyst to justify the market's movement. There are apparently more real factors that contributed to the dramatic drop that was not expected as it accelerated its downward momentum during the closing of last week's movement.

We still maintain our current position to on both cross rates; GBPJPY & EURJPY to gain momentum on its downward direction for the week. Although, some conflicting signals would occur within the major trend. The near term movements would react with more volatility and wide price fluctuations as major institutions would simply eliminate small speculative investors from the market. A convincing follow-through price momentum towards the upcoming Consumer Price Index (CPI) and the University of Michigan's Confidence figure would more likely be mixed but would also have a friendlier net effect for the USDX in the long run. Then this would reaffirm and gain more interest for US Dollar bulls.

The news of S&P's downgrade for Greece & Portugal's contagion effects looming in the air has taken the highlights on the news. Not to mention the debt and trade deficits of what the US is facing is a battle cry for every trader's choices as to what the direction of the market would be in the coming trading days. After a Euphoria market, chaos and confusion on market directions takes place. This is where market psychology takes into account the market behavior from past experience in trading these volatile market.

Visit our website: www.megatrade101.com for a complete market review

An Effective Trading Strategy Part 2

2011-05-06T00:38:00.000-07:00

Fundamentals:

Considering what just transpired in the Foreign Exchange Market with the key major currencies have made more dramatic when the ECB decided to hold such interest rates increase as of the moment. the cause and effect of such interest rates hikes would have been untimely. Rate differentials amongst major countries are taken into consideration especially with most of the Asian Pacific Region countries gradually increased their rates while the Japan and the United States have kept its stance as a way to assist a flagging economy. Keeping it where it is now have prompted a timely US Dollar recovery which have given some breathing room for market sentiments to shift its course, making price adjustments for the majors to correct itself from these events.

The second consideration is the continued increase on margin requirements for the precious metals where increase in open interest have been building up for the past several months. Based on the Commitment of Traders reports that most major participants were indeed institutionals and for those unwilling to accept the requirement had no choice but simply to settle such existing positions that led to the major corrective movements in Gold and Silver in particular. Paying close attention to the Volumes and Open interest would determine any probable shift in money flow and drastic measures on technical momentum would be reflected on the price behavior.

With that said, the Technicals and trading strategies have to be in place during these critical times of market conditions. such as the description of an effective strategy that would apply in these conditions.

Technicals:

From our previous market view analysis as of May 03, 2011; the confirmation of the GBPJPY & EURJPY heading lower was made after the above reports on the ECB was released. This was the fundamental factor that have caused the recovery on the US Dollar which was the main interpretation of the market. Prior to this decision the almost all of the 1st and secondary target levels have been achieved. Starting with the USDX at the 72.70bp low, Euro at the 1.4880 with extensions at the 1.4938, the EURGBP cross rate at the 0.8900 and extending to the 0.9040 just to name a few. Such target levels where obtained in sync with the market behavior prior to the two major reports for the week. And this also coincided with the new month of May signaling a major correction within a major trend. Price reversal do occur whenever such market price objectives are attained on a given period of time. which apparently the majors did.

For a complete report, including trade plan, market view analysis and execution pls. visit our website: www.megatrade101.com

Next Best - High Probability FX Trade Video

2011-05-05T06:57:00.000-07:00

http://www.youtube.com/watch?v=00JrEJy1YxM

Update: this video supports the Market View Analysis dated the 3rd of May. Speculating what the next best currency pairs that has a high probability of market potential. Please visit our complete report on the market conditions on our website: http://www.megatrade101.com/

Next-best - High Probability FX Trade

2011-05-03T06:14:00.000-07:00

The investors sentiments and price behavior of the Forex market has undoubtedly been weighing more than any particular news that comes out. Not even the news of Osama bin Ladin death hardly had any effect on the USD as many have claimed that a recovery could be made as a welcome news. The irony of the matter is that the consistency of the US Dollar's weakness has not been really respected by some analyst. As they foresee an eventual end and may soon signal for a reversal.
Unfortunately, we still don't see any real circumstances that may provide such a reversal. True enough that the USDX has maintained its lower levels for quite some time now and registered a low at 72.80bp. A slight recovery back to the 73.20+/- would only be a technical adjustment that would equally be reflected with the rest of the major pairs.

Amongst the heavy players in the market are still the favored major financial institutions dominating the market, as reflected in the Commitment of Traders report. Nonetheless, speculative short positions by most retail traders have run into troubles for the past months especially on the European currencies particularly the Euro. Anticipating market trend reversals for the Euro and the USDJPY have been the norm for some of the reports and analysis from the broker-dealers and traders recommendations for a couple of months then. And now, the change of heart shows that most traders are eyeing on the 1.5100 levels.

We still maintain our position on the market analysis until such time that we do see an indication for changes or eventful changes that may transpire in the market. For the time being, the corrective moves on the GBPUSD gives enough breathing room for the cross rate EURGBP to move to its 2nd target objective at the 0.9020-9135 range levels. Although, Asian and European investors are shifting some positions and funds adjustments as some profit-taking has been made during Gold's corrective move back down to the USD1520.00/oz. levels. Next best move would be towards the Japanese Yen correlation with the British Pound as it makes is technical adjustment. Based on our process of elimination; the next-best probability trade to choose from would be the GBPJPY.

Visit our website: www.megatrade101.com for a complete report and market view analysis.

The Gartley Pattern Illustrated:

2011-04-30T22:55:00.000-07:00

The Gartley Pattern: GBPUSD Monthly Chart

The Gartley Pattern Vs. Perception

2011-04-30T22:54:00.000-07:00

Strategic Forex Trading - SRO

2011-04-23T10:10:00.000-07:00

Just for the record! A summary, Review & Outlook Ahead

The amazing truth of the matter, is that when the Forex market made that slight recovery on the USDX at 75.50bp; the EURUSD headed lower with prices coming back to its original trend higher was the real limelight. The corrective movement, as we mentioned on our April 16 video ' 8 Forex Technical Trading Tools & Analysis thru 4-22' on Youtube and a follow-up market view analysis dated the 18th of April ' Major Correction within a Major Trend' mentioned that it was just a short-lived correction that we expected and could more likely be a buyers trap. Well, it did turn out to be one.

Although, that corrective move was considered to be a major correction coming from a 1.4520 high and down to a low of 1.4155 for the EURUSD from 04-14 to 04-18 respectively for three consecutive days. Thereafter, the registered high was at 1.4647 on the 21th of April. Which is a three day up move from a three day down corrective move. A retreat from the highs made some significant statements that that a selling divergence between the Relative strength and momentum indicators on those high prices met some forced liquidation from earlier bear positions holding on until they threw in the towel. In other words some market capitulations from sellers in the market. However, these would not be entirely be seen in the market except knowing how the market prices have behaved by following the price page indicator. On a technical perspective by comparing the divergences between the higher prices with the relative strength and momentum indicators should provide you with the signal. Although, by having a keen analytical eye and training can this be achieved. Which apparently, other traders and analysts were calling it a possible reversal. Of course its always after the fact. . . easier said than done! right?

Meanwhile the GBPUSD did the same exact scenario that dropped to 1.6165 from a high of 1.6250 which is a slight correction. However, that particular higher curve we mentioned from our video plus the idiosyncrasy of the Sterling Pound of making a double top candlestick formation was a false indication that would only move upwards. And registered a high just about 1.6600 vs. the USD. The lower closing at 1.6510-15 levels was merely because of the shortened and thin closing trading sessions for Good Friday.

For a complete market view report of this article and the continuing market outlook; pls. visit http://www.megatrade101.com/

Major Correction within a Major Trend

2011-04-18T06:31:00.000-07:00

Corrective movements are prevailing the forex market amongst the major currency pairs including the cross rates. As this is part of the statement from our previous analysis, that a major corrective movement should not be discounted within a major trend. A price reversal as we call it but definitely not a trend reversal.

The EURUSD corrective moves lower is influenced more on the fundamentals related to the Irish downgrade and on a technical note is now out of its overbought areas along with the rest of the currencies across the board. Interest rates hike is still looming in the air for the ECB to continue it intentions raising rates sooner than later. However, the contrary analysis for the daily prices to move lower for the European currencies are now in effect. Although, we do anticipate it to be short-lived. The 1.4520 levels is just the initial resistance ideal for the correction, alongside with the EURGBP's 0.8770 low to be stable and a good support price for the cross rate. Risk factor is minimal with a -100 pips tolerance level but rather substantial for short term main street investor to trade long for a position. While the GBPUSD tries to recover from its corrective moves sooner than we expected.

Meanwhile, the influence of the EURJPY is weighing in more on the continuation of the upward trend for the EURUSD as it pulls-back in line with the USDJPY currently working at the 82.55 levels alongside with the USDCHF at the 0.8929 levels. The EURJPY looking at its 1st attempt back to the 116.00-50 area levels, as the technical spike candlestick formation weighed heavier. As of the moment this a a technically motivated market. The same goes with the GBPJPY.

The corrections on the USD led to this movements as some good reports came out fromt he US slight recovery in spite of the surrounding conditions. As the trading week is gaining closer to the month closing expect some wild fluctuations on both directions but we do remain firm on our analysis until the 22nd and a spill-over effects towards the 27th of April, 2011

8 Forex Technical Trading Tools & Analysis 2 - EURUSD & GBPUSD thru Week...

2011-04-17T07:54:00.000-07:00

Observation: Getting a kick on Speculation!

2011-04-15T01:28:00.000-07:00

During our period of reading through most of the forex articles by broker dealers and other trader's analysis; we have observed lately that most write-ups, forex article related to market behavior tend to speculate on reversal patterns in the making. Anticipating a reversal in any currency pair may or may not be more than calling and claiming that they have called a market forecast accurately. At times, its not about calling a price correctly based on forecast, but simply taking market behavior on step at a time. As a market trend reversal can only be called if and whenever a new price is established on the higher or lower side of the market.

As we gather market sentiments and studying current market conditions; as perplexing as it may seem, most of these analysts have been calling a near term probable market reversals for the Euro and other currency pairs. With all due respect; whenever such calls does not appear to accommodate their analysis, tendencies are they do change and never go back to their written articles.

As a matter of caution, most market analysis provided by some are merely short term. For those who provides both sides of the market are in a better position in providing the pros and cons of the market. However, the psychology behind most analysis is to provide a short term outlook leaving enough room for traders to trade. Be extra keen on the time table of charts being shown as the time frame needs to be identified and would have to coincide with the analysis. An example would be a 15 minute chart, including some technical tools and a 200 day moving average. Of course, some analyst would simply show the relationship with it, but does not necessarily relate to a short term trading analysis. Thus providing a not so clear picture of what is being presented. However, with all due respect, everyone is entitled to their own opinions and analysis. So it all depends if you would buy or sell your trade at the end of the day's trading.

In essence, knowing a trader or investors perception is equally important to be entirely independent of what one reads and see in the market place, including this writing. A certain level of comfort & ability in trading decisions can only be attained from due diligence and careful studies before trading. A short video which we have presented before; the 8 forex trading analysis describes at least 8 to 9 trading tools that is needed to come up with at least an informed decision and a clear observation of the related currency pairs that does influence the market conditions. Link to video: http://www.youtube.com/watch?v=n9gE1iN-wUU

As we come back to reality, the Consumer Price Index and the University of Michigan reports would be more influential as to the direction of the USD. As it has lost its luster from market investors as they are try to maintain their oil and precious metals positions in the futures market. No sign of market sentiments shifting otherwise in spite of some corrective moves on the Gold and the oil prices. The closing market prices across the board on the currency pairs are vital to provide some much needed direction and an overview of the next probable currency pair to move by next week.

Technical Vs. Fundamental Analysis 04.12

2011-04-11T23:13:00.000-07:00

Interestingly enough, the prices on the currency majors and cross rates have outperformed our expectations especially for the EURJPY and the GBPJPY registering record levels; respectively at 123.31 for the EURJPY & 140.05 for the GBPJPY. The trading signal and price indicator has been provided since early January and the only confirmation of the trend reversal was after the market was influenced by the Yen accelerating to it strongest levels 76.73 equivalent to the 106.50 & 122.60 for both cross rates. This has made it possible for the more influential institutions to clean the slates with minor speculative traders out of the market. As some may disagree, but the relative price behavior and indicator has proven that from the market forces after the incident of the international currency intervention led by the Bank of Japan.

On the Technical perspective, the market charts for these two pairs have shown its vulnerability in making a corrective move lower; within a major upward trend. This would be found on its daily movements like this week, where we can find technical price adjustments to support a technically over-bought price levels. The euphoria sentiments on a major upward trend has not been swamped with settlement positions as the market would now have indicated. Although, the first signal that it would is daily closing of these prices across the board, but more importantly the closing for this week's market prices.

What this all means, is that a minor correction of the EURGBP would be an influential factor for the time being before it would break away from its previous trading range values of 0.8550 -0.8770. As the 0.8790 was the week's low is just above an important support. As we do speculate that these corrective moves are merely a preparation for the next leg upwards unless a stronger tone and incentive would be made and led by this week's fundamental reports. Nevertheless, the market itself would dictate the pace coming from investors sentiments. Please pay more attention to the relative correlation between the financial futures market's volume and open interest; as it would provide a trading signal of any market shift of price reversals. Note: that a price reversal does not constitute a market trend reversal. As new highs and lows needs to be established after the fact.

A ripple effect would be expected as the market shifts when the prices on the precious metals would also close lower than the opening prices for the week. That would confirm a negative selling-divergence bias to a downward momentum by the earlier part of next week's trading. The up and coming reports on Friday's consumer price index may still favor the USD on a friendlier tone. But this would be overshadowed by the performance of volumes from investors shifting cash flow towards a settlement.

Indeed, easier said than done, after the fact. However, as we recall, the previous market view analysis have stated this scenario. Which has led us to speculate that the continuing trend lower for the USD has not been discounted. The relative stronger market sentiments for the USD bears have been more influential with investors funds still in the oil and commodities market. Which one outweighs the other, is a question as to where a turn around would be expected. Not until fresh incentives would provide, the Forex market would still be dominated by major market participants who happens to have deeper pockets than most retail speculative investor. Choosing which side of the trade you're on would be the defining position.

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