Trend of the Day - Page 5 - DailyFX Forex Forum

KP FX Trader · #61 (**permalink**) 11-21-2008, 11:18 AM

Hi Greg, Thanks for the posts.
Resistance in a downtrend seems harder to pick with such great volatility as opposed to a break of support, is that accurate or is it just my perspective?
I suppose what I am trying to say is, in a downtrend, what is more reliable resistance or support? I suppose resistance, if there were not strong resistance and breaks of support, a downtrend wouldn't be a downtrend.
Volatility is simply part of the trading biz.

Also, is it safe to say that within a 24 hour period the market will retrace? to some extent at least. Let’s say I trade a breakout of support or sell a rally at resistance and the trade is going my way, sometime during the next 24 hours or just after 24 hours the move will retrace. Therefore in and out within 24 hours seems to be a good approach. I suppose just a matter of personal preference. I am just learning to deal with "leaving money on the table" as the market whipsaws, I suppose another matter of personal preference.

Gregory McLeod · #62 (**permalink**) 11-24-2008, 09:13 AM

Quote:

Originally Posted by KP FX Trader

Hi Greg, Thanks for the posts.
Resistance in a downtrend seems harder to pick with such great volatility as opposed to a break of support, is that accurate or is it just my perspective?
I suppose what I am trying to say is, in a downtrend, what is more reliable resistance or support? I suppose resistance, if there were not strong resistance and breaks of support, a downtrend wouldn't be a downtrend.
Volatility is simply part of the trading biz.

Also, is it safe to say that within a 24 hour period the market will retrace? to some extent at least. Let’s say I trade a breakout of support or sell a rally at resistance and the trade is going my way, sometime during the next 24 hours or just after 24 hours the move will retrace. Therefore in and out within 24 hours seems to be a good approach. I suppose just a matter of personal preference. I am just learning to deal with "leaving money on the table" as the market whipsaws, I suppose another matter of personal preference.

I use Fibonacci resistance levels in addition to price reversal points/previous resistance points to identify resistance in a downtrend. Lower risk trades can be made selling at resistance in a downtrend as opposed to a break of support. Too often after a breakout, price retraces back within the range. If I am looking to get a large piece of a trend move, I would wait after a breakout for prices to retrace back. This gives me a better entry with out the anxiousness of waiting for a pull back.

Gregory McLeod · #63 (**permalink**) 11-24-2008, 10:27 PM

As many desire to call a top for the dollar as a result of dollar pairs taking a tumble yesterday, the Daily trend remains up. In fact, the USDCHF has a well defined trend channel (the yellow lines) where we can target a re-entry to Long this pair. Support comes in the 1.1500-1.1700 area which is the lower channel support line. We are some 300-500 pips above this area so patience is a must as prices retrace. Daily oscillators are overbought and turning down signaling weaker prices are to follow before this pair launches to new highs. The June 14th 2007 high of 1.2467 would be the next logical target.

Gregory McLeod · #64 (**permalink**) 11-25-2008, 12:59 PM

GBPAUD appears to have completed its 3 wave correction to the 61.8% Fibonacci support area after reaching new highs back in October. MACD is below the zero line but heading upward and Stochastics is point up as well. Look for the 2.6000 to be reached in the coming days. A break below the 2.1550 area would invalidate this bullish scenario.

KP FX Trader · #65 (**permalink**) 11-25-2008, 01:05 PM

can you please tell me where you drew the fibs on this? Its not clear to me.
From what date to what date?

Gregory McLeod · #66 (**permalink**) 11-26-2008, 09:16 AM

Quote:

Originally Posted by KP FX Trader

can you please tell me where you drew the fibs on this? Its not clear to me.
From what date to what date?

It is the June 8th, 2008 low.

Gregory McLeod · #67 (**permalink**) 11-26-2008, 08:54 PM

Look for GBPUSD to move violently in thin Thanksgiving trading. Look to sell any price rejection from Fibonacci resistance in the 1.5886-1.6245 areas targeting 1.4000. Be careful and always trade with stops and limits. Happy Thanksgiving.

Gregory McLeod · #68 (**permalink**) 11-30-2008, 07:21 PM

The AUD/NZD’s current countertrend move appears to be running into a wall of resistance made up of the 200 SMA and the 61.8% Fibonacci resistance level in the 1.2090 neighborhood. Daily stochastics remains oversold and MACD seems to be roll over. Wait for a daily candle close below the red trend line to confirm the resumption of the daily trend.

Gregory McLeod · #69 (**permalink**) 12-01-2008, 06:34 PM

EURGBP is our Trend for the Day

After taking a brief rest, EUR/GBP has resumed its upward climb back toward its November 13th high of .8669. The pound is weaker against many currency pairs as expectations that more aggressive rate cuts will come from the Bank of England. The 38.2% retracement of the October low (.7693) to the November high of .8669 served as strong support. Chasing this market is not advised and a pullback would provide a better risk to reward with stops placed slightly below the .8235 November 28th low.

Gregory McLeod · #70 (**permalink**) 12-02-2008, 10:26 PM

Trend for the Day for Wednesday, December 3, 2008

I am still looking for the EURGBP to retest the .8669 area. We got a very slight pullback during the New York session to .8437. EURGBP closed outside the Pennant on the daily chart. This is extremely bullish. If EURGBP can clear its recent high, there isn’t any resistance before the psychological .9000 area.

KP FX Trader · #71 (**permalink**) 12-03-2008, 10:02 AM

so it seems now a break of resistance for entry instead of a pullback to support would be the play. Thoughts?

Also, how are you considering the Rate decisions coming out tomorrow for this pair? If EZ cuts more than expected and UK less than expected, that may be bearish for the pair. The converse having converse affect. If both cut more or both cut less than forecasts or both remain the same, then there may not be much movement. Am I considering this accurately?
Of course I know predictions ar avised against and the market itself will dictate the outcome.

Gregory McLeod · #72 (**permalink**) 12-03-2008, 10:39 PM

Quote:

Originally Posted by KP FX Trader

so it seems now a break of resistance for entry instead of a pullback to support would be the play. Thoughts?

Also, how are you considering the Rate decisions coming out tomorrow for this pair? If EZ cuts more than expected and UK less than expected, that may be bearish for the pair. The converse having converse affect. If both cut more or both cut less than forecasts or both remain the same, then there may not be much movement. Am I considering this accurately?
Of course I know predictions ar avised against and the market itself will dictate the outcome.

In my opinion, the market is a discounting mechanism and the expected outcomes of the rate decisions of the BOE and the ECB are already "baked" in the price of the EURGBP. There may be momentary fluctuation in the pair as a result of the decision. However, when the dust settles and all is said and done, we will probably see EURGBP return to the uptrend. Any pullbacks or dips in the pair could be regarded as buying opportunities. I am not a news trader and it is risky to attempt to trade the actual decision. News rarely, if ever, changes the overall trend of a currency pair. The trend is up, so we look to buy after the news announcement

Gregory McLeod · #73 (**permalink**) 12-03-2008, 11:14 PM

EURAUD Trend for the Day for Thursday, December 4, 2008

EURAUD is coiling in a tight Pennant formation. The European Central Bank (ECB) rate decision could be the catalyst needed to break this pair out of this range and toward new highs. The daily trend remains up and prices are hugging close to the rising daily support trend line. Buying at support with a stop 50 pips below the trend line targeting the next level of resistance occurring at 2.0597 would be a possible course of action. An alternative course of action entails buying a break or the Pennant at 1.9902.

Gregory McLeod · #74 (**permalink**) 12-04-2008, 05:39 AM

Quote:

Originally Posted by jeffsmith

Thanks for the help this means that this pair is showing an upward trend for the day.

Based on the Daily chart, price has been making higher swing highs and higher swing lows in a stair step pattern up; this is the definition of an uptrend on a daily chart. The odds are that prices will probably continue to move in this direction- until is doesn't. A close below this trend line could be the either the beginning of a reversal or just a minor pullback in the overall trend. In either instance, trading with a stop is prudent to limit risk.

Gregory McLeod · #75 (**permalink**) 12-05-2008, 07:57 AM

Usually, when the ECB cuts rates, the EURUSD and its cross rate cousins take a bit of a tumble as investors in search of yield look to other currency pairs. However, this was not the case as “buy the rumor sell the fact” sparked a Euro rally across the board. EURCAD was a benefactor and is poised to break out of its 1400 pip range. Ideally, I would look for a pull back to the daily trend line as these gains are digested by the market. However, buying a break of the November 21st high of 1.6229 to target the 2005 highs of 1.6399 and 1.6551 respectively would be considered.