Analys från DailyFX

"Classic" Long Set-up in EUR/CAD

Published

11 år ago

27 januari, 2014

DailyFX

Talking Points:

Pullback in Overall EUR/CAD Uptrend
Key Support Zone for Initiating New Longs
The Ideal Time Frame for Taking This Trade

With last week’s two star trades, the first in GBPJPY, which is now more than 400 pips into profit, and the second in EURGBP, which is running with a 60-pip profit on tiny initial risk, now well on their way, it will be interesting to see if the winning streak continues into this week, possibly signalling a return to a higher-probability trading environment.

See previous trades:

Today’s trade is a textbook set-up in EURCAD that involves buying a pullback in an overall uptrend. This trend is clear on both the weekly and below daily chart, but it has the drawback of potentially having put in a blow-off top.

Guest Commentary: Clear Uptrend on EUR/CAD Daily Chart

Nonetheless, it is far wiser to trade in the direction of the overall trend, and thus, all that remains is to find a logical zone of support from which to initiate this trade.

The risk zone can be found on the below four-hour chart, although it is admittedly a little higher than expected. A nearby pin bar that was formed on the way up reveals a hidden level of support, and price has already begun to test this level. The support zone then extends down to the top of the previous major move up.

Guest Commentary: Key Support Zone for EUR/CAD

Of course, this zone also includes the rising level of support. It is 79 pips deep, which is small compared to the overall potential of this trend trade. Even a move back to the top would contain at least 180 pips, and if it made a new high, there would be much more.

To gain precision, however, it is preferable to take an entry on the hourly chart (see below), which may afford for a smaller stop loss. The trigger for this trade could be bullish reversal divergence, a pin bar, or a bullish engulfing pattern on the hourly chart.

Guest Commentary: The Ideal Time Frame for Trading EUR/CAD

The hourly chart also sports an eight-wave Elliott pattern which may be completing a “c” wave, possibly indicating higher prices in the near future. Price has already begun to react with the support zone, having just grazed it, but it will require the close of the hour in order for proper judgment to be made as to whether this trade has officially triggered.

As always, two or three tries may be required in order to get in on this trade, but each try will probably have less than 25 pips of risk, and thus, that aspect of the trade would be well under control and in fact advantageous should the trade go quickly.

By Kaye Lee, private fund trader and head trader consultant, StraightTalkTrading.com

Analys från DailyFX

EURUSD Weekly Technical Analysis: New Month, More Weakness

Published

8 år ago

30 september, 2017

DailyFX

What’s inside:

EURUSD broke the ‘neckline’ of a bearish ‘head-and-shoulders’ pattern, April trend-line
Resistance in vicinity of 11825/80 likely to keep a lid on further strength
Targeting the low to mid-11600s with more selling

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Coming into last week we pointed out the likelihood of finally seeing a resolution of the range EURUSD had been stuck in for the past few weeks, and one of the outcomes we made note of as a possibility was for the triggering of a ’head-and-shoulders’ pattern. Indeed, we saw a break of the ’neckline’ along with a drop below the April trend-line. This led to decent selling before a minor bounce took shape during the latter part of last week.

Looking ahead to next week the euro is set up for further losses as the path of least resistance has turned lower. Looking to a capper on any further strength there is resistance in the 11825-11880 area (old support becomes new resistance). As long as the euro stays below this area a downward bias will remain firmly intact.

Looking lower towards support eyes will be on the August low at 11662 and the 2016 high of 11616, of which the latter just happens to align almost precisely with the measured move target of the ‘head-and-shoulders’ pattern (determined by subtracting the height of the pattern from the neckline).

Bottom line: Shorts look set to have the upperhand as a fresh month gets underway as long as the euro remains capped by resistance. On weakness, we’ll be watching how the euro responds to a drop into support levels.

For a longer-term outlook on EURUSD, check out the just released Q4 Forecast.

EURUSD: Daily

—Written by Paul Robinson, Market Analyst

You can receive Paul’s analysis directly via email bysigning up here.

You can follow Paul on Twitter at@PaulRobinonFX.

Analys från DailyFX

Euro Bias Mixed Heading into October, Q4’17

Published

8 år ago

29 september, 2017

DailyFX

Euro Bias Mixed Heading into October, Q4'17

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

EURUSD: Retail trader data shows 37.3% of traders are net-long with the ratio of traders short to long at 1.68 to 1. In fact, traders have remained net-short since Apr 18 when EURUSD traded near 1.07831; price has moved 9.6% higher since then. The number of traders net-long is 15.4% lower than yesterday and 16.4% higher from last week, while the number of traders net-short is 0.4% higher than yesterday and 10.5% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EURUSD prices may continue to rise. Positioning is more net-short than yesterday but less net-short from last week. The combination of current sentiment and recent changes gives us a further mixed EURUSD trading bias.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

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Analys från DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Published

8 år ago

29 september, 2017

DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

GBPUSD: Retail trader data shows 38.2% of traders are net-long with the ratio of traders short to long at 1.62 to 1. In fact, traders have remained net-short since Sep 05 when GBPUSD traded near 1.29615; price has moved 3.4% higher since then. The number of traders net-long is 0.1% higher than yesterday and 13.4% higher from last week, while the number of traders net-short is 10.6% lower than yesterday and 18.3% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests GBPUSD prices may continue to rise. Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current GBPUSD price trend may soon reverse lower despite the fact traders remain net-short.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, please fill out this form