Let's See Who Blinks First!

Soft market gears post FOMC w/ #investors #traders balance who blinks first in the next few sessions towards the end of the week's activity.

On the CCY Corner: So far #USDJPY still caught within range with the exception of the Euro keeping to stay afloat during the current session. Combining Candlestick Bar & Western Bamboo.

https://dwq4do82y8xi7.cloudfront.net/x/pTId3ZH1/

PRICE ACTION Analysis Defined

Insight through the Eyes of Sir Alexander @megatrade101 (Brief excerpt)

Price Action Analysis is a vital key trading discipline, interpreting a simple price chart based on the price changes in the market. The chart could either be the Asian  Candlestick bar or a Western Bar format that should have no lagging technical indicators included on it. Probably, with a few exceptions of drawing trend lines that reflects  support & resistance levels thereafter.

The simplest form of a price chart describe herein has no technical indicators on it. The consistency of a mere Candlestick Bar formation to reflect price action by itself would be considered a practical method of reading through price movement without having to develop a bias market opinion at first glance. This could be done either with the Candlesticks or the Western bar chart method of analysis.

MegaTrade101 - Process of 'Price Action Analysis'

CCY Corner: USD Divergence 2

Watch for our next "Market & Price Action Analysis On How to Read & Timely Execute Trade Positions from Overlay Chart Patterns Based on the USD" as a primary market indicator.

DXY Update: As of  9.25.15

Technical Vs. Fundamental

This is just one of the tools of the trade identified from the four chart patterns overlay from our previous $DXY analysis and its correlation with the rest of the major currency pairs. The simple selling divergence resulting from the recent decline and the result of a price recovery was fundamentally supported by FED Chair J Yellen's speech for a continued rate hike for the year fueled the current rally for the USD Please refer to the patterns listed below as a fresher to identify individual signals compared with overlay patterns when a combination occurs during the course pf trading sessions.

Reference Chart Patterns

CCY Corner: USD Divergence 2

Case Study: Effective Sequence of Trade maintaining the course

CCy Insight & Price Behavior: USDJPY

UPDATE 11.22: USDJPY Steadily supported with fundamentals with US economic data while GBPJPY cross rate supports both majors contrary to the USD daily price swings. Corrective moves have materized specially with Cable holding steady as it continues to move higher. An effective "Sequence of Trade - maintaining the course"

UPDATE 11.15: USDJPY finally breaks benchmark of 100 way above trendline resistance and tight trading range! And this is more related to Yellen's perception and ecominc outlook for the Fed's taper schedule of providing more to help the US economic recovery.  Please take note of the original date above 11.12.13 of this analysis, while it is still quite effective inspite of the stream of market data for the week.

As of 11.12 : Observing market action from the sideline has its benefits of being able to clearly see through the market's price volatility and investors market sentiments. The main market drivers can only be summarized into two segments, namely ECB Mario Draghi's rate cut decision and the much better than expected Non-Farm Payrolls report.

CCy Insight & Price Behavior: USDJPY
CCy Insight : GBPJPY Cross rate

The Right Approach to Technical Analysis

Part l: Technical Analysis
In most cases. an effective technical analysis MegaTrade101.com follows a distinct process based on historical trends established and price action that can be used as reference points for price resistance (High) and (Low) support. Depending on the approach and objectives, identifying trends can best be viewed as short-to-near term, medium-to-long term outlook.

This process would enable trader-investors the abiity to decide an appropriate trade position to take in the market place. More importantly, an effective technical analysis combined with a few selective tool applications can be utilize to project directional price trends ahead of the market. Certain market conditions do apply at certain times. As market conditions vary in some degree, price action plays a vital role in reflecting true market sentiments on real time trading. Click to continue

Related article: A Constructive Approach and The Strategic FX Trading Techniques

Next Level Analysis ll

Comparative Approach: DX EURO DJ-FXCM USD:

The market has been fixated on the upcoming FOMC report that would probable dictate the outcome of the financial market this week. Although, the G8 summit meeting is focused on the Middle-East crisis and comments indirectly affecting commodity prices that would add to a volatile oil and gold prices is expected.

This would also provide some insights to the FED's clearer "Taper" time-direction from the FOMC that would make market price volatility in the coming days. But in the absence of major reports for now, market prices moves within a tighter range before any major moves are done.

In the inverse monthly chart figure 1; the correlation of the Spot USD Index (Black Line Graph) overlay with the Euro (Japanese Candlestick )provides an indication of the USD weakness more than the Euro have been supported both by fundamentals and technical analysis. And with the increase volume since the start of the year; the first quarter were USD friendly and a major corrective decline have emerged before the end of the 2nd quarter of June as volume again builds-up in line with increase market volatility. Click to continue

Trading Consistency:

USD Overlay USDCHF:
The chart below represents the Dow Jones - FXCM USDollar (Japanese Candlestick) and an overlay line chart (Black) of the USDCHF-currency pair that has the closest correlation with the USDx.

At first glance, the upward trend has been defined after breaking away from the consolidation and thereafter rallied to its high. However, the volatility of price action hear the highs have reflected a "Tug of War" between bull & bear players as prices went in both directions several times. And currently the Dow Jones-FXCM USDOLLAR reflected two(2) DARK CLOUD clusters indicating a negative (bear) signal.
Click to continue