Thread: Discuss USD/JPY, GBP/JPY, and other JPY Pairs

Originally Posted by sirfx

Edzfx,

AMEN!
There is no doubt we are about to collapse inthis cross...

I believe your use of theword 'next' is key though
Technically analysis from a dynamic perspective has shown we are correcting off the most recent weekly low.IMHO, we have to have an A-B-C correction on the weekly chart. I now believe we have completed A Nd B, where B had a lesser degree C wave from 135.90 to close at 132.60. That is a lower weekly close than just a couple weeks ago open at 132.70ish. I believe a bear trap has been set! With A and B now complete or very close to complete....look for a weekly wave C to bust through 136.40 and crestng 200-300 pips near the weekly downtrend line. As you know that is 139.40+++. This move and retest of whateverhigh will take approximately 5 weeks possibly 6. IMHO majorwave 5's down tend tolook more range bound so its hard to say with 100 percent accuracy.....but we are going to see this pair in the 105-110 area in the last quarter..O I A9 VERRRRRRRRY! BEARISH!!. as you!
For now though I believe the correction will continue until we get a trendline break/failure. Technicalss are currently the key to whats next!

SIRFX

Thx Gooch!

Although Im not a practitioner on Elliot wave I do how ever watch out on Gartley Patterns.

Im trying to take a break from trading as its summer low volume but I am somewhat taking a peep at the markets to stay abreast,should a waterfall on GJ appear to form I will dive in but Im still Bearish and will not trade any longs.

Lets see what Fri holds in the stress tests???

Oh BTW I don't Trade live on Mon or Fri or last few days of month or tipple witching etc........Perhaps this has kept me alive the last 3 years :-)

Although I have bent the rules on rare occasion :-) like last Fri as i figured the market was going to take profits and GJ would probably drop in the direction of the overall trend :-) Passed S3 but Im happy with the pips as

I found you sure cant go broke taking profits if somes left on the table Im not fussed.

Edzfx

HI ALL THIS MIGHT BE A GOOD READ FOR SOME IF NOT SORRY FOR THE LONG POST BUT IT HAS SOME INTERESTING PERSPECTIVES ON THE MARKET

Market-Makers Signal A Usd Swing Point- Ready?
A sideways pattern of trade that is caused by the distribution, or selling, of an asset before a reversal of the recent move occurs, looks to be happening on the major pairs right now. Currencies have run out of Usd momentum after absorbing a huge period of economic information recently, as well as half-year equity reporting.

The eight-week consolidation phase now looks to be turning into a distribution reversal and a swing point high on the dollar index may be in place.


This is an introduction to how tenured traders piece together the major swings in market mechanics, and ride the momentum of the global market swing point moves by understanding participation, consolidation, distribution, and manipulation signals.


Participation: When used as a confirmation tool that specific price points of note are also being monitored by others, participation is invaluable. Increasing institutional participation indicates an interest and/or a need to protect or break a specific price area.

However, when compared to the volume reads that traders are accustomed to seeing in equity and commodity trade, forex volume is not an exact read of all market orders, but more of an indication that participation is above or below the norm.


The volume that we see in the spot currency market is however a fair reflection of the countable volume that is seen in the futures currency exchanges. On a higher market participation (volume) day, there is more chance of hitting a price target in good time, compared to a below average volume day.


Consolidation: Protecting the current price point, and not wanting to go up, or to go down as price action is contained. Consolidation phases usually happen on light volume and are times when fair value has been found and market participants are happy to hold prices steady.


Distribution: Liquidating the positions that are being held, but not wanting to reveal that it is being done, while getting ready for a move in the opposite direction. Distribution phases usually have heavy, erratic volume spikes as the commodity or asset is liquidated, and bought back in smaller amounts by the party looking to distribute.

The buy-back has to happen in an effort to stop the distribution turning into a sell-off before the job at hand is completed.
Traders are at a stage in the market cycle that is one of the most frustrating to deal with, and where the most money gets squandered in trying to work things out, and to establish where fair value is actually placed.

This stage is when the global market goes through a phase of consolidation; a sideways period of trade that looks to be absorbing the recent moves, while is anticipating a continuation of the previous trend.

Consolidation can sometimes extend itself so far, and for so long, that it actually turns naturally into distribution, where the asset starts to get sold as the realization that the original trend has expired, and forward momentum disappears.

Add in low participation and low speculative interest levels, as we have right now, and market participants get comfortable with the status quo, just at the wrong time.
For experienced market participants, the move from consolidation to distribution phase is known to create the most market fear, or volatility, and that is what an experienced trader, with a plan, can feed off.

There is no real way to confirm the move from consolidation to distribution until it is right upon us, and at that time the herd mentally tends to over-exaggerate the subsequent moves.
Trading through the distribution phase of global trade has to be well planned, have smaller targets, and a more flexible thought process that looks to buy support and sell resistance in the direction of the Daily and/or the 4-hour trends. The need to close trades in two 30% stages before the high/low of the previous session is hit is key.


The investor herd still has their head down as the distribution phase is happening; they are grazing on the previous trend, blissfully unaware that the change is happening on the mid-term charts. Once the market players have distributed their holding of the previous trend, and have positioned themselves going the other way, it becomes time to inform the herd that things have changed, to get their head up out of the trough and to get a stampede going.


A screaming headline is always good for that, something along the lines of; "Dollar strength in the face of NFP misery, Buy Dollars!!!" or "European Continent Slides Into The Mediterranean, Buy Euros!!!".
The news headline, designed to wake the herd up, tends to reverse the recent headlines that were there to hide the efforts to distribute out-of-date holdings.

Add in some high frequency trading (HFT) to get 2-3% moves just as each regional market is closing, and the major players have an easy job of moving prices.
Participation, Consolidation, Distribution, Headlines; the pattern is there, it has been for decades, and now seems to work even more efficiently in the automated bi-polar markets that are the norm in 2010.

The main players are already in, they have worked the market mechanics, have linked the moves in the Treasury, oil, gold and equity futures markets, have used previous trading experience to get to know how participation, consolidation and distribution work. They are waiting for just one thing; the herd to realize that they are going the wrong way so that they can sell dollars into them.


Are you ready for the screaming headline? We have already seen the jawboning from central bankers and policy makers. All we need now is for the players to have had their fill and to start to push the buttons that will get the herd moving.


Consolidation? Absolutely, we have had global market consolidation for enough time that it may be turning into distribution as we watch.


Distribution? It would seem the way that U.S. trade patterns have developed that distribution is taking place; we have seen sporadic volume and some strange, untimely moves.

One of the largest forex managed account companies, and pseudo-Federal Reserve market maker, just moved the long held year-end price target on Eur/Usd from 1.1500 to 1.3500 in a signal that they are now already positioned and waiting for the herd to move.


Participation? There is nothing strong about market participation levels recently, and that is the perfect foil to get a major job done, especially when automated 5-10% monthly melt-ups and melt-downs are accepted as the norm in the new generation global market trading arena.


Headlines? Oh yes, more than enough of them to start to realize that somebody wants the herd to move.
Daily Chart Detail: The breaks away from intra-day (inside the previous session high/low) price action areas on increasing participation, and major headlines, will be the key to being in the next trending phase.

It is coming; all we are looking for is a volume spike over and above the norm on a daily close.
That will be the blow-out signal that the consolidation/distribution phase is through; a trending period of trade comes next, born out of the channeling period of trade that held things steady for quite a while.

The dollar index was unable to close through major resistance at 89.00, it looks as though the Usd may be about to get weaker through the dog days of summer.
The short-dollar moves are not a given at the moment, and there will be periods of Usd buying, but we do look to have the foundation in p-lace for a major Usd swing point high.

EDZFX

hi,, im newbie in forex
i made a long position in jpy at 87.12, im confuse in my position now
need your suggestion about my position . . thanx

Short @132.85. Where is everybody.

GBP/JPY Locked in a Channel - The 136.58 resistance level and 130.31 support level have held GBP/JPY hostage since the end of May. It will be interesting to see what fundamental catalyst will break this pair out of its prison. A Double Top on MACD below the zero line is bearish but the sidelines would probably be the best place to be until the market makes up its collective mind about this pair.

Originally Posted by Gregory McLeod

GBP/JPY Locked in a Channel - The 136.58 resistance level and 130.31 support level have held GBP/JPY hostage since the end of May. It will be interesting to see what fundamental catalyst will break this pair out of its prison. A Double Top on MACD below the zero line is bearish but the sidelines would probably be the best place to be until the market makes up its collective mind about this pair.

Thx for you advise sir.
My action just to wake everybody up.

Originally Posted by Sagas

muz_malaysian > Short @132.85. Where is everybody.

Attachment 62232

Off to get changed, Just spilt me ruddy tea again! Lol

Originally Posted by Sagas

muz_malaysian > Short @132.85. Where is everybody.

Attachment 62232

glad everybody r here.

So far it looks as I expected before, lets see if it breaks 131.27 support line and open doors to 129 level

Originally Posted by cahyadi

hi,, im newbie in forex
i made a long position in jpy at 87.12, im confuse in my position now
need your suggestion about my position . . thanx

Welcome Cahydi,

One thing to do is to reflect on why you took the position.
Was it a tecnical indicator, fundemental?

One thing to remember: avoid trading against the daily trend.


All the best,
Lee.

USD/JPY Bearish Against 87.30 - The breakout below the 8730 low saw the USD/JPY touching 86.20 before making a u-turn and headed higher. Usually, after a breakout, price will return to the breakout point before resuming the breakout direction. This move often fools retail traders into picking a bottom or early reversal. SSI is at extremes as nearly 6 traders are long for everyone that is short. This is very bearish as SSI is a contrarian indicator.

Originally Posted by cahyadi

hi,, im newbie in forex
i made a long position in jpy at 87.12, im confuse in my position now
need your suggestion about my position . . thanx

still down trend

Originally Posted by Lee Saunders

Hello Greg,

Where do you find a 400 PIP reward in such a strong bearish move? Isn't that picking a bottom?

Regards,
Lee.

Hi Lee! Price does not move in a straight line and usually retraces against the primary move to at least the 38.2%. In this case, a retracement from the lows was 400 pips away. You can see a retracement on the USD/JPY. Risking 100 or 50 pips to make 400 does not sound half bad.

Originally Posted by Lee Saunders

Well, I've never seen SSI so extreme before.
SSI=6. Now either all these traders are going to get it right this time, or there's going to be one heck of a drop as the stops get blown away.

Next week is going to be interesting.

Hello Lee, a year ago the SSI for USD/JPY was over 7 and it dropped 300 pips in one day. However, I have seen bearish extremes in USD/CHF and in a rare instance retail traders got it right and USD/CHF went up to 1.1700. So no indicator is 100% correct. This is why we look at technicals support and resistance levels to confirm the SSI signal.

Originally Posted by cahyadi

hi,, im newbie in forex
i made a long position in jpy at 87.12, im confuse in my position now
need your suggestion about my position . . thanx

Hello cahyadi. Good to have you with us! A break below the 86.20 area should open up 84.67. The trend is down as was mentioned earlier. Price is making lower swing highs and lower swing lows in a stair step pattern down. However, a break above 89.14 could indicate a reversal in trend.