Why Forex Majors & Cross Rates?

The popularity of trading the Foreign Exchange market has exponentially grown over the past three decades since we could remember. Having encountered countless traders, where the majority are so familiar and more knowledgable when it comes to the Forex majors.

With a globally linked trading mechanism in place when discussing about the Foreign exchange market, the Majors currency Pairs has always been in the limelight. This has been the priority & most basic information for any financial institution providing feeds or a varity of financial news coverage in the market. The obvious reason is simply that majority of businesses and economies in different parts of the world runs under their respective currency flagship. The assortment of industry levels that deals with trade in a global perspective will always be concentrated with a balance between nations currency values.

Traders have always asked...Why go beyond the Major Currency pairs, while majority of the trades nowadays are made simple towards the majors?

Why FX Majors & Cross Rates?

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

FOREX Market Insight ll

The revised GDP figures of 1.8% have placed an initial cap for the USD rally at current market conditions. Although, mixed reports on the state of the slower than expected economic recovery have also created a gray cloud over the Fed's tapering schedule.

With jobless claim falling and a slight improvement on consumer spending have signaled waivering sentiments as to where the next direction for the USD would take place. But the commodity prices on the yellow metal continues to decline have so far been supportive of the USD in these current levels. These conditons may weary its strength in case fresh demand would perk-up Gold prices on its way up for a corrective recovery in the 1250.00 /oz level from a low @1180.00 Likewise, As a matter of due diligence, please refer to where the corresponding price level of the USD Index when Gold prices were at the same pivotal price @1200.00 to have a better understanding of the point spread between gold and USD prices.

With the end of the month and 2nd quarter trading position / price adjustments by major institutions; this would add to increase price volatility by the opening of the new month in July. Market behavior focuses on any possible change on the Fed monitoring slower growth as the revised decline on GDP had little impact on the current USD levels.
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Forex Market Insight:

Major market mover in the making!

Now that the market has reacted from the direction & time-table by the FED when it comes to tapering QE3, the USD's price action in today's opening levels have signaled a near-term exhaustion. The price gap can be interpreted another way - as a daily breakaway only if a subtantial follow through price action above the 83.50 levels would sustain towards the closing price of the week and month's trading activity.

Market conditions and price behavior shows otherwise; as prices have been struggling in both directions since European opening sessions. The four (4) hourly bar formation since Asian opening have signaled an island session reversal, filling-in the gap lower in the American trading session. Momentum from the USDx low since the Fed's annoucement have gained traction while heading to its current levels @82.57 to this writing. The USDx retracing back-down should not be discounted towards the remaining trading days fo the month that would still justify that the overall trend for the USD heading towards the third quarter have established a higher low. With exceptional constraints whether such price range would be maintained. But if the prices holds true below the 83.05 primary resistance before the end of the month we would probably see a major correction in the making before the real trend higher follows through.
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Understanding Forex Price Action: 4 Majors & 4 Cross Rates - LIVE 6.12

Forex: Price Action Strategy

Weighing Market Sentiments 2
Update: GBPUSD & GBPJPY vs. USD

As the ECB & the BOE held rates; the string of reports from the private sector jobs and the Labor department on jobless claims have dampened the spirit of the USD. Market sentiments on negative USD price reaction to this writing weighed heavier.

As the USDx maintained its decline as low as 81.07 slightly above the Feb.25 pivotal price breakaway towards the high. Expecting some pullback reaction from market capitulations coming from the huge Open Interest (bullish) USD speculators after the reports; once again have been caught flat-footed by the sudden decline & outburst of the major European currencies. Likewise, do expect a greater amount of increase in volume activity with declining open interest, on top of the declining USDx for the coming week. With the same case scenario for momentum build-up, increase in open interest and volumes from its European counter-parts. Click to continue

Weighing Market Sentiments-FX Majors & Crosses

Fundamental vs. Technical 6.4

In focus this week are data from Europe and the United States as well as the all important U.S. employment report on Friday. And this would take some serious considerations as to what would weigh more and be the driving force to move the market.

For starters the Aussie first climbed as high as $0.9790 in the early Monday trading session, and currently trading correctively @0.9652. Initial support is seen at $0.9565 which represents a daily engulfing-bearish bar when the price closes below this support. It would take the lead by mid-week when the GDP figures will be release on Wednesday (June 05) As expected, a temporary relief recovery came through from a defined bearish trend and a continued decline is seen in today's price acction. A negative bias remains enforced until a clear direction would state otherwise from the USD that may come from the Non-Farm Payroll figures this Friday which would be the main catalyst for the market by then.

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Market Psychology...

Behind price action: EUR.GBP Cross

Draghi's hawkish tone

As the Bank of England declined to add more to its stimulus package; the statements made by Mario Draghi of the ECB has turned the Euro from an obvious lower trend bias into a round about turn moving higher.

The initial price action remains to have ignited a EURUSD price swing from 1.2950/65 low to its current working price @1.3105; nearly touching its 14day-EMA and nearing its 1.3175/80 resistance price levels. The quick reaction sent most technicians referring to their charts pointing at the next resistance price level which spilled-over to the EURGBP cross that moved at least close to an 80pip range for the current trading session. And have marked an 0.8714 high coming from the low @0.8587-0.8610 range the past few trading sessions before the current price swing higher @0.8705/10.

EURGBP Counter-trade Strategies