For those of you that are adamantly against fundamentals, Barry Ritholtz over at the Big Picture blog pointed out something interesting in the PPI reading, which I'm sure is pretty consistent through all the Fed's favored inflation reports and probably into other government measured statistics.

"Rereading the BLS release on the train on the way home last night, I noticed another aberration: In October 2007, BLS reports that energy prices were down 0.8% in October.

"As absurd as that appears on its face, there is actually a simple explanation for this. The methodology for measuring PPI contains a simple and dramatic flaw: It measures prices on a single day of the month. BLS samples for energy prices on the Tuesday of the week that contains the 13th of the month. In other words, BLS’s methodology essentially ignores all energy prices paid EXCEPT FOR ONE DAY OF THE MONTH."

While I understand the need to take measure it on a static day - otherwise you would be absorbing far too much data - but it just goes to show that these aren't always the best measures to represent what citizens are actually feeling.

Allan,

I was just looking for what levels of support there were on the lower and medium time frames. At the time, 1.4630/40 was intraday support and this level further found strength from its previous efforts as a level of resistance and 30-bar SMA on the 4-hour chart (which is a one week moving average).

I placed an entry just below this level to ensure downside movement; and I set a target pretty close as a break of this modest floor wouldn't convince me of a real, momentous market turn. For a more convincing move, I'd look for a move below 1.4510 which is the 11/12 swing low, a rising trendline on the 4-hour chart and 38.2% fib. A move to retest 1.4510 would very likely encourage a push to 1.45 and institutional influence would likely push it a little more to run stops and get a better price for any potential long positioning; so I would set an order at 1.4485 (or perhaps a lower) to catch any true momentum in a medium-term downside.

Most of these entry and trade setup rules I follow every time as part of a money management and trade strategy scheme.

[quote=ForexGirl;139881]
i must say i had fiber rolling fantastically for me. i got my tgt of 4530, however got greedy and hit out at 4566. euppy had my throat dried off, but with avg longs running at 159.66, i was amazed to see a move higher, much higher then i was expecting. i bailed out rather all my limits hit out at 160.22. for maths thats an aweful trade. but with longs streching from 162.XX all the way to 158.XX just to get an avg around 159.66, i have no regrets. ok just a lil bit to maybe see or get another 100+ pips or so...
Note to myself: euppy is no longer a one way / diretion trade and its a perfect pair hitting out both ends of the stops...

flat now and looking for a possible retest of 146.70 to start getting in shorts on fiber all the way back to 147.15/20.. there should be another run to the lows or we head back above 148.....

good luck all............ and once again i must admit, i almost blew over 40% of my equity had euooy dipped below 158....... feeling lucky defintely.

__________________
Patience is virtue. The sooner we learn this all, sooner we can start walking to the bank. Good Luck to all of us—
The trick is to wait the price meet ur limits, instead of one jumping in.. however scalps is a totally different scenario and is not everyone's cup of tea
Disclaimer: I'm not at all suggesting trades when by either posting the graphs, or my entries. You can view it, but in the end you have to use your own logic and approach, as there is no certainty about this uncertain market...

EURUSD - The ratio of long to short positions in the EURUSD stands at -1.53 as nearly 61% of traders are short. Yesterday, the ratio was at -1.63 as 62% of open positions were short. In detail, long positions are 8.5% higher than yesterday and 38.0% stronger since last week. Short positions are 2.0% higher than yesterday and 0.9% weaker since last week. Open interest is 4.5% stronger than yesterday and 5.5% below its monthly average. The SSI is a contrarian indicator and signals more EURUSD gains.

Source: FXCM Execution Desk

For historical data and the latest charts based on the SSI please visit http://www.dailyfx.com/story/special...140917987.html

For information on an FXCM Managed Fund that takes advantage of the SSI, please review our Sentiment Fund at: http://www.fxcmmanagedfunds.com/ or call +1 646-432-2968.

Cross posted in the candlestick forum:

Just released an interesting report on candlestick profitability in forex markets, with specific focus on two strategies in the EURUSD.

http://www.dailyfx.com/story/tophead...160706372.html

At the time of this writing (22:30 GMT) it looks like EURUSD is forming a nice decending triangle on the 60 minute time frame with a horizontal node at 1.46. This could be the makings of a downside break, so I may try to get on board with a small sized short for 40-50 points. The reason for my modest objective: the rising trendline from the 10/30 low at about 1.4560 and rising about 12 points a day; and the swing low and 38.2% fib of the 10/22-11/9 rally at 1.4515.

Since my profit is limited, I'll only take in on market orders and if I'm watching it through the entire trade.

Actually that's where I would disagree with you. The thing about trend is that it tends to go almost always to insane levels before turning. This is why very smart people lose a lot of money fading, They tend to be absolutely right but early. The SSI is unique in that it doggedly stays with the signal when "maturity" readings would suggest otherwise. I remember the other great EURUSD run in 2004 when almost "everyone" thought the trade was done at 1.33 only to be stopped out at 1.36 - which btw is where SSI turned.

That to me is its greatest value. It tends to stay "insane" much like the trading crowd long after all the momentum indicators have given up on the trend and when it turns in those situations it usually offers the best signal on the Street.

But as I said you need lots of room to let it do its job.

Dear Sir/ Madam,
Do you think eur/usd will still head for 1.5 level given the current situation ? Oil may not reach $100 also.
It looks like balancing in this current level 1.45-7? Any likelyhood into 1.40 or below ? Next year would be USA election year, would it be corrected/otherway?

Could you fill in the forecast range level for the euro/usd for me :

Nov07 Dec07 Jan08 Feb08 Mar08 ahead
hi-low ............... ........... ............ ............. ........... .........

example 1.45- 1.47

Many thanks. DN.

EURUSD - The ratio of long to short positions in the EURUSD stands at -1.72 as nearly 63% of traders are short. Yesterday, the ratio was at -1.53 as 60% of open positions were short. In detail, long positions are 6.4% lower than yesterday and 4.7% weaker since last week. Short positions are 5.7% higher than yesterday and 2.3% stronger since last week. Open interest is 0.9% stronger than yesterday and 5.6% below its monthly average. The SSI is a contrarian indicator and signals more EURUSD gains.


Source: FXCM Execution Desk

For historical data and the latest charts based on the SSI please visit http://www.dailyfx.com/story/special...140917987.html

For information on an FXCM Managed Fund that takes advantage of the SSI, please review our Sentiment Fund at: http://www.fxcmmanagedfunds.com/ or call +1 646-432-2968.

Well, for your information, weak USD is good for US economy. boost exports make US cars more attractive overseas.

Hence in a coming presidential yr, more jobs is more important than a stronger USD.

In China, the ATM have run out of cash, as the HKer are rushing to Shenzhen to change their HKD into CNY.

Also there is rampant underground banks operating, wherby HK, Taiwan funds flow in and out of China through shell companies, investing in properties, stock markets. Some of these operations are upto billions dollars

If HK gets off the Dollar peg, then probably Malaysia would follow. and eventually the Middle-Eastern countries.

The longer these companies stay on the peg, the higher the inflation. Inflation is scary. Again, we are seeing workers striking in Taiwan, HK asking for higher compensations. they dun get what they want, they strike.

With a higher EURO, some companies in Asia acutually suffer forex losses.
E.g. some Singapore companies disclosed upto hundred millions dollars in forex losses betting on a weaker Euro at the start of this yr.

then there was a report that came out that claim that China economy is not as big as it seems, as there are more people below the poverty line.

Crevices start appearing in the Asia economies, and the Asia hype may fade next yr.

2008, every markets would come to a grind.

however not expecting anything drastic, like a plunge, but slow grind, like a rebound, and then another selling, up and down, in a downtrend channel.

As for Euro, do not expect anything dramatic, it just settles into this new range 1.4300 to 1.4800 for the next couple of months. Gold shold be holding 700 for a length consolidation period, probably lasting for 2-3 yrs. Oil also hugging 90.

The liquidity is simply supporting the markets, while US and Asia slow down. something like a slow brake.

If you want to know where to park your monies for the best yield, subscribe to my newsletter.

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Hi All,
If the OPEC traders decide to adopt Euro as the trading currency; what will that mean for the Euro and the Euro zone?
We would then see hyper inflation in Europe and the US if the Euro remains at lofty levels.
That in turn would mean that there would have to be a massive increase in interest rates. Business in Europe would halt.
Their other option would be to devalue the Euro to prevent hyper inflation by the tune of 30-40%.
Any other thoughts on this looming prospect? All hypothetical ATM but a possibility as the US$ continues to decline.
Anyone watch the programs on the devaluation of the £ in1967? The similarities to the devaluation of the US$ today are uncanny, for the same reasons.
A war in the middle east the UK could not afford. The massive balance of payments deficits. Oil.
All this leading to a 14% devaluation and a hike in interest rates to 8%. All the factors that were relevant 40 years ago this week remain insitu.

__________________
Keep in mind that neither success nor failure is ever final. --Roger Babson (1875-1967)
YTD +5%

Nothing as dramatic as that. Who is to say OPEC would not make a huge mistake and bottom tick the market by moving to euros now. 1.50 could well be the intermediate term top and if that's the case then a move now would be highly damaging. Much like UK Treasury selling half the country's gold at $220/oz. right at the low in 1999.

But the SSI signal will tell you a move is to keep going, even when the move is finally over because at extreme levels, traders will continue to try to point out a bottom/top - and more and more depending on just how extreme the level is. It's just human nature. Ergo, the SSI will say the trend will continue indefinitely, which we all know is incorrect. Just look at the SSI reading a few weeks ago at CAD .9100. If you had listened and sold there, you'd have been subjected to a 700 pip loss right now (assuming you tried to hold).

Trend maturity readings urge caution when a trend is getting to a certain point because of the level of reading. The SSI has no such indicator that I am aware of.

It's obviously difficult to disagree with the fact that the SSI ratio incorrectly signaled further USDCAD downside at last week's price levels. But, in reality, the ratio of longs to shorts actually shrunk in the USDCAD's run to 9100. That's one of the things we mentioned around that time. It had been the first time in recent memory that traders did not try to buy into further USDCAD bounces. This kind of setup tells you that the signal for further losses is definitely weakened.

Ok, I see where you're going. You're saying that the indicator showed overall longs had lessened to a degree (I don't remember what that degree was, and it's probably irrelevant at this point) and therefore there was less of a chance to continue on the downside. But the signal stated that the "Signal is a contrarian indicator and gives a strong signal to sell USD/CAD". This was paraphrased, but generally accurate. However the signal, was not accurate.

Again, there are a host of signals out there traders use. Using one signal alone to determine your moves as a trader is essentially assuring your failure. But certain signals are helpful, others are coincidentally helpful. At the end of the day it's up to each trader to pick those they figure work the best.