#EURGBP Cross follow-through as #CABLE surges

As CABLE prices recovers from UK manufacturing data, investor / traders shift gears lower for the EURGBP influencing the EURO's decline as of this writing. EURGBP @0.8406 levels at the early European session managed to stay at its low from the report.

With a positive report GBPUSD or CABLE trades @1.3245 a closely related mirror image of the EURGBP ( Click to see Chart). Although, early tech indicators have shown a small bearish triangle formation even before the report; all other factors related to a declining EURO based on their relative correlation have been validated. The direction of the EURGBP cross in this market condition: the process of monitoring how well CABLE can influence and could weigh more than the EURO. Thus keeping a lid on the EURUSD trading @1.1135 as of now.

Due to a wider range of these currency pairs heading into the US session, expect a reasonable price swing of volatility added into the mix. The prevailing sentiments remains until a new catalyst from fundamentals would again become a game changer. Take note that alternating trades between European majors will continue while the USD would keep abreast with the changing conditions from stocks and oil prices.

Brief Series #Price_Action & Tier 3 #Technicals #USD #EURO #JPY

MEGATRADE101 TRADING APPROACH 
Relative to market conditions and inverse price comparison with Futures and Spot dealing with the US DOLLAR, EURO & the JAPANESE YEN 

CCY Corner: #USD Still Key Driving Force in Market Volatility

US DOLLAR INDEX - DXY

With the most recent developments surrounding market price action in the CCY market, the prevailing catalyst over and above significant event risk has been the remarkable price movement of the USD as measured by the US Dollar Index - DXY marking a new low @91.90 on just the first week of trading for May 2016.

The relative market influence on increasing 'Volatility" have spread extremely well as turning points on price reversal, including follow through actions among certain currency pairs that have contributed a wider trading range, price target extensions / expansion from a technical chart perspective.

CCY Corner: #USD Still Key Driving Force in Market Volatility

A Keen Eye on the AUDCNH Cross - FINALLY

Finally giving way cashing in after price extension snaps from high. After patiently waiting from over extended price action and expanded moves have now been pressured to give up some of its gains. Watch later as bloomers try to catch session pullbacks!

AUDCNH as of 4.27.16 Asia session

Comparative Analysis & Insight #USD Index #USDJPY

Sequence Analysis Supporting MegaTrade101 Market Call on USD/JPY dated April 11, 2016
The Price Action and Market Behavior seen from the USD decline towards the 93.62 (4.11.16) basis point was a similar movement and market behavior compared with the EURO. This was when the ECB announced a triple rate cut which saw the EURUSD moved lower @1.0820 and recovered with a strong pullback from the low while still currently @1.1218 on the way lower.

The similar move for the USDJPY registered a low @107.63/65 twice marked on their daily session. And the subsequent turn-around as the volumes from liquidation (Lower Open Interest on Futures-COT Report) was evidenced with the price reaction. This strategy was a sequence trade from a Short-USDJPY & USD Index cross traded with the correlation of the AUDUSD position trade taken previously.

A close monitoring / following of our market view analysis and written article information before and post market events for the past liner cycle period covering major price action would help viewers be able to follow how MegaTrade101 trading approach are done and executed in certain conditions & during exceptionally volatile market.

Comparative Analysis & Insight USD Index & USDJPY

BRIEF INSIGHT: Established Trend AUDCNH Cross Rate

#AUDCNH Far Exceeding our Expectations! It can only get better in time! Patience is bitter but its fruit is SWEET :)

UPDATE AS OF 4.19.16

Reference Market Call  April 16, 2016

NOT JUST FX: ETF CORRELATION

Alternative ETF Strategy & Taking Maximum Market Potential on USD weakness whenever a confirmed trend reversal occurs . A distinct advantage over current market conditions as the Power Shares DB US Dollar Index Bearish Fund (UDN) most appropriate relative to the  selected currency positions.

As of April 18, 2016

Guideline: Effective Analysis v. Contrarian Theory

The probability of greater rewards would outweigh the risk of loss in a given period of time. Other traders and or analysts for that matter, often times look at what the overall market sentiments are. One of the most common is the traders speculative positions and market sentiments index that shows the percentage of long against short positions in each currency pair traded.

Other traders, crowd sentiments are often associated with the general contrarian strategy that traders perhaps opt to practice from time to time in their way of trading the market. Here is a comparative guideline for an effective analysis v contrarian theory that would be useful to know in trading these markets. Which are sometimes a good sense of justification whether the presumed trade goes in line with the crowd sentiments or not. The degree of difficulty to identify a potentially good trade setup may take time to develop. And market orientation of most traders nowadays are focused on what the market presents that can be best taken into account for a good trade. Essentially timing the execution is the next issue to consider.

Most often, traders' eagerness to re-position after a loss, may well have the same negative result; as the emotional factor of getting even in the market takes place. This should always be avoided as it would not help build market trust, trading ability and confidence in trading analysis for traders / investors particularly for retail trading that has smaller capital for risk tolerance.

Raising the Bar of Trading Confidence

'Trading Confidence' is much like the market itself. As the market prices do change more often, so does investors and traders sentiments trading outlook. The same way that prices quoted on the board & onscreen are truly a reflection of what's behind these price movement.

And appropriately defined as a reaction or simply as the reflection of a fundamental oriented market where external factors are influencing price fluctuation. This is just one of many factors that can affect changes in the market place.

Excerpt: Part 1 of 7 Series
(Not Hanging-on a Thread)

Often times during our session meetings both on sight and online; have been asked the question 'How do traders gain the 'Trading Confidence level' in the market. Some traders we've been fortunate enough to get acquainted with over the years; the answers really comes in so many variations. Likewise, here are just some of those information that we like to share.

Major reports normally have a scheduled release date. With most analyst and traders call 'Event Risk'. And when due dates for important data are to be release, expect prices to move in anticipation of the data and right after; either as a direct or indirect end-result from the released data. And most often are interpreted to be bearish or bullish that affects the market prices.

With that said, one of the most basic way of being able to level-up trading confidence is to have a certain process of due diligence on the instruments that the trader / investor intends to engage with. Including all aspects and probable angles deemed necessary to define if its well worth taking the investment risk for. This is where 'Trading becomes a Medium for Investments'. Tactical investors who makes time to actively participate in this process would have the necessary information at hand to firmly make an informed decision.

RAISING the BAR of TRADING CONFIDENCE

Revisitng: A Matter of Perspective Analysis ll

Here are three (3) correlated market information that may be quite useful to go back through as a matter of market perspective that can best serve as a reference. The market's ability to move counter-trend market reports is respected similar to the price action that transpired with the Euro that gained its strength coming well from market sentiments while pushing prices above the 1.1340 last week.

However, note that prices came from a double low @1.0822 post ECB and made a crucial turn to its current price @1.1265 close for the week ending 3.18.2016. The higher low marked @1.1057 was way even lower than the opening price for the week but was still able to hurdle the price that led to an increase in volume that also gave fresh incentives for prices to retest nearest to the resistance level of 1.1380 which also serves as the 1st line of defense.

For as long as the USD - DXY stays below the 95.05 mark; the relative price action of the European majors is well on its way higher; unless an unexpected report would say otherwise.

With that said, the USD already had spilled its sentiments on the USDJPY nearest to the 110.55 by making a low @110.65 which is just about the same price spread that it already did. These levels are bound to take a price reversal not necessarily a trend reversal as newer lows and highs needs to be established. And this goes well with the DOW and the SP500 with the exception of the JPN225 which is a clear downward trajectory for now.

These topics are quite useful to apply as it does relate how market would react post a major move and market volatility. Not necessarily in their respective order.

How to measure a price change on a rebound or decline

A Matter of Perspective ll

Aftermath of a Market Volatility

USD Continues Decline Spill over Across the Board

Early European session have pushed the USD index below the benchmark support @95.05 and have reached a new session low @94.68 as of this writing. As of March 04, 2016 our market insight have indicated a probable low that was briefly described as follows:

MARKET REWIND FOR USD INDEX AS OF 3.04.16
Although, the session prices with the USD reacted positively the overall strength have fizzled out and lost steam as the new month may prove to be a top heavy for such a price recovery without the real momentum in spite of the good data from the NFP. Meanwhile, the strength of the Aussie Dollar have reached above the 0.7400 levels which have validated our trade call from our previous post analysis below which happens to be an effective trade analysis well in place that may probably make a follow-through by the coming week.

UPDATE: DXY @94.68 LOW AS OF 3.17.16

The continuing decline of the USD is in line with the USDJPY reaching a low @110.68 which resulted to the spill over effects and price action with the European majors. Adding to the recent price recovery are Oil & Gold likewise resuming their upward direction which have placed a serious cap on the USD. With a weaker USD, this would provide further lift for commodities as well and included here is the AUSSIE Dollar being a commodity related currency that has proven to be on the same trajectory moving higher currently trading @0.7605 with a high price @0.7650 in early US trading session. Thus, turning trade positions into a Value Investing Strategy. However, playing it with caution; watch for session pullbacks by Friday being the end of the week's trading towards the closing session.

Recognize Market Behavior Relative to Price Action

Supplemental Market Brief POST ECB on EURO...
Confirmation from COT Report

At the time of actual rapid price action, recognizing the market's behavior relative to price action was a critical time. Since most speculative Euro traders were already well positioned on the short side of the market. And eventually reloaded upon learning what the ECB had decided to do. That led the decline of the EURUSD back to the 1.0860 levels and made a sudden turn-around thereafter until the closing of the week ending the 11th of March 2016.

Sure enough the volumes supporting the rapid price change that led the upsurge was substantial, 892K contracts. And this was 2X the open interest that ended the session with just about 436K +/-. Open Interest were 4392 contracts by speculative day traders mostly coming from the retail, non-commercial markets.

And base on the CFTC - Commitment of Traders Report - better known as the COT report that was just released late afternoon. Indeed the speculative shorts were in the area of 91.3K as of the closing date of Tuesday March 9. That already provided some glimpse that the market positions were in fact over loaded. This alone was that confirmation before the data where the principle of selling the rumor and buying the fact still plays a role in the old school of trading combined with new technology-driven base trading does matter with these volatile markets.

Knowing when a speculative outlook turns into a smart trade position for value investing is indeed a edge over the market. Utilizing the important information and data on Volumes and  Open Interest in Spot, Futures and Options markets can only help derive a favorable investors with the right trading decision most of the time. 

Therefore, recognizing the rally was certainly a market short-squeeze for speculative traders which we do not encourage especially for new retail day traders that would simply get stop-out of the market without a reasonable fight. This is were unnecessary losses can be avoided. Due diligence is always good as it pays to walk the extra mile!

Sequence of Trade Strategies 2

Original Trade Position 1

Weighing Volatility with Market Behavior

Market volatility remains a variable factor in trading; as external forces dominate factual current conditions in the market. A Keen analysis of the Global markets!

3-Reasons Volatility Coming Back - El Erian

Market Insight Turns Trade Position for Value Investing

MegaTrade101.CIPHER3 Analysis

In trading financial markets, undergoing a certain process of deduction takes a considerable due diligence in choosing which of these instruments best suits current market conditions that would well have the highest market potential with the best probable return over a period of time.

After a extensive due diligence in the current FX market, while the process that took place started as an initial speculative outlook, the current resulting price action from our recent market position on the Australian Dollar, SPOT AUDUSD - AUDH2016 Futures has just changed its status into a smart trade position for value investing.

Market Insight Turns Trade Position for Value Investing

Insight: #EURO @Greater Risk with #CABLE

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

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

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

CCY Corner: DXY CABLE EURGBP Correlation

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

CCY Corner: DXY CABLE EURGBP Correlation

Market at a Glance!

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

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

INSIGHT: FX & Stock Indices Price Action

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

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

INSIGHT: FX & Stock Indices Price Action

New Price Cycle Starts on CCY & STOCKS

USDJPY 

PRICE ALERT: 

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

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

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

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

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

Behind the USD Decline Update - What's Next?

US DOLLAR INDEX (DXY)
As of 2.05.16

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

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

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