Forex Trading Software

The EURUSD failed to continue it’s bullish momentum  yesterday. Like I said, the pair need a consistent movement above 1.4850 area to confirm the bullish scenario towards 1.5000 area, something that  didn’t happen yesterday. So, what is the plan for the upcoming week?

Just like this week, the trendline support area will be my technical focus next week, as you can see on my daily chart below, after failed to stay consistently above 1.4850 area price is now moving lower re-testing the trendline support once again. 1.5060/80 resistance area (circled) seems to be an important resistance as price keep moving lower after fail to break above that area. A break below the trendline should trigger further bearish scenario towards 1.4450 area.  As long as the trendline support hold, the bullish scenario should remains intact but I  think the bullish exhaustion warning and downside pressure is also still there.

Have a great weekend and see you guys next week

Popularity: unranked [?]

Simultaneous Release at www.thegeekknows.com

Follow me on twitter

Hi there,

Once in a while, i get questions asking me why was a support respected when it was 1.4718 instead of 1,4719.

I would like to address this common misconception today.

Firstly, what are resistance and support lines?

When viewed on the chart, these are areas whereby the price seems to bounce off.

From a market point of view, these are areas whereby traders feel that enough is enough. ” I will not buy more at this price as it is too costly” ( Resistance Line ) or “I will not sell any further as this is too cheap” ( Support line )

For example, we note a support line at 1.4719.

However, there may be folks who are more stringent and will not sell lower than 1.4725 or perhaps we have folks who are easy going and are willing to sell as low as 1.4715.

This effectively “spreads” out the effect of the line.

This can be one of the reasons why we usually see the price slow down and consolidates when approaching an area of support or resistance as various expectations are being filled.

Another point i would like you to note is that forex being a decentralized market, will usually not have a standard price across all brokers.

If you whip up two charts from different brokers, you will probably see a difference of a few pips.

This contributes to the concepts of resistance and support lines being areas rather than a single line as what may look like 1.4719 to you, maybe 1.4721 to another.

Lets refer to the chart above. It shows the EUR/USD bouncing of a resistance at 1.4951 and later a support at 1.4910.

Notice that the price did push beyond the lines on a few occasions.

Therefore, it may not be feasible if one sets stop loses right on the line as the above example would have triggered your stop loss, just to turn back in your favor moments later.

That’s all for now and i hope i have shed light on how resistance and support lines work.

Trade safe.

Read more Forex Articles and Views by The Koala at www.thegeekknows.com

Follow me on twitter

Popularity: unranked [?]

FXstreet.com (Córdoba) – The Pound fell on Friday against the Dollar but managed to hold weekly gains. GBP/USD failed to break above 1.6600 and started to fall. The pair found support at 1.6410 and ended the week near the 1.6450 zone. Cable rose for the week but is still moving sideways against the Dollar in a range between 1.6230 and 1.6700.

Against the Euro, the Pound rose on Friday for the fifth consecutive session and broke and important trend line. EUR/GBP finished the week below 0.9000 for the first time since mid September. To the Swiss Franc, also posted important weekly gains as GBP/CHF finished near the highs of the week that lie at 1.6940 (one-month high).

Michael J. Malpede, analyst at Easy Forex affirms:” GBP posted strong gains versus the EUR this week supported by report of improving UK consumer confidence and a rise in UK house prices. The trade will turn focus to the November 5th BOE (Bank of England) policy meeting and whether the BOE elects to maintain its current level of asset purchases or to expand those measures. (…) Because of the uncertain outlook for the UK recovery the BOE is expected to be the last to exit accommodation and may actually be forced to expand policy measures.”

For more information, read our latest forex news.

Popularity: unranked [?]

FXstreet.com (Córdoba) – The Dollar rose against the Euro erasing Thursday’s losses. EUR/USD fell to 1.4700 (intra-day low) but failed to break below. The Euro did not hold above 1.4800 and weakened. The fall in stocks helped Greenback that finished the week higher for the first since late September

EUR/USD finished October with gains for the fourth consecutive month but far from the highs. The Euro pulled back after reaching at 1.5060 the highest price in 14 months.

Ilian Yotov, from AllthingForex comments on the coming month: “The U.S. Non-Farm Payrolls plus four interest rate announcements from the Fed, the Reserve Bank of Australia, the Bank of England, and the European Central Bank could set the trend for equities, commodities and currencies in the month ahead.”

For more information, read our latest forex news.

Popularity: unranked [?]

FXstreet.com (Córdoba) – U.S. markets ended Friday with deep losses. The Dow Jones and the Nasdaq plunged 2.50% and the S&P500 fell 2.80%. It was one of the worst days in Wall Street since April. The increase in risk aversion helped the Yen and the Dollar that recovered from yesterday’s losses and currently are consolidating weekly gains.

All the gains following the release of GDP figures in the U.S. where erased on Friday on concerns about the future of the economy and on weak consumer data. Commodities also tumbled: crude oil fell 3.60% and trades barely above $77 a barrel.

The Yen and the Dollar where favored by falling stocks. EUR/USD trades near the 1.4700 at intra-day low. GBP/USD is testing a support zone at 1.6400 while USD/CHF consolidates above 1.0250.

USD/JPY plunged to 89.90 posting the lowest price in two weeks. Against European currencies the Yen rose even further and recovered from yesterday’s losses. GBP/JPY is testing intra-week lows at 147.60 and EUR/JPY fell below 132.75 to 132.30 posting the lowest price since October 12.

For more information, read our latest forex news.

Popularity: unranked [?]

FXstreet.com (Córdoba) – Dollar is getting stronger across the board with the exception of the Yen on a big sell-off in equities. GBP/USD fell after the opening bell to 1.6415 (intra-day low). From there rebounded sharply and rose back above 1.6500 but failed to hold and regained the downside.

After finding resistance at 1.6450, Dollar gain momentum and the pair fell to 1.6410 posting a fresh intra-day low. The next support lies at 1.6400 and below at 1.6330.

Michael J. Malpede, analyst at Easy Forex affirms:” The main focus for GBP trade apart from the risk appetite is BOE policy outlook. In light of last week’s report of a surprise decline in UK Q3 GDP the BOE may elect to expand its asset purchase plan at next week’s policy meeting. The BOE meet on November 5th and are expected to decide whether to extend the current size of the asset purchase plan of £175 bln. The BOE’s decision will be crucial to the outlook for the GBP because a number of central banks and governments are preparing to withdraw stimulus.”

For more information, read our latest forex news.

Popularity: unranked [?]

On Thursday Dollar/Yen continued reached a bottom at 90.25, from where corrected sharply upwards to the 91.60 top, closing the day at 91.48. After failing to break above the 91.60 resistance zone, today the currency pair continued descending. Yesterday the currency couple broke down the bullish channel on the 3 hour chart, indicating stronger bears. Our expectations are bearish for now with objectives towards yesterday’s bottom and nearest support 90.25. If, however, the above resistance is broken up, the bearish outlook might be shaken again. The CCI indicator is in the overbought zone and downwards to the 100 line on the 1 hour chart, suggesting a downward outlook.
Technical resistance levels: 91.60 92.80 94.00
Technical support levels: 90.25 89.00 87.85

Popularity: unranked [?]

The pair rose sharply Thursday following a rise in risk appetite as a report in the U.S. showed the economy expanded by more than expected. This spurred demand for riskier assets as Wall Street ended with sharp gains for the day.

The U.S. economy expanded at an annual rate of 3.5% in the third quarter of 2009, following a decline of 0.7% registered in the second quarter, and above the +3.2% expected.

Earlier, German retail sales printed below expectations as the actual came in at -0.5% versus +0.7% expected. The previous month’s reading was downwardly revised to -1.8% from -1.5%.

Ahead, U.S. personal income and spending figures will hit the wires, followed by the Chicago PMI and the revised University of Michigan consumer confidence. Currency traders will look at equity markets for guidance.

Looking at the 4hour chart, EUR/USD rose to an intraday high of 1.4860 from a pre-U.S. GDP of 1.4720. The pair remains steady at the top of its move ranging between 1.4810 and 1.4860

Although higher levels are viable, a retracement is possible before renewed buying interest resumes. The change in risk sentiment suggests EUR/USD will continue to edge higher, but traders need to monitor equities for further guidance. A preferred strategy looks to buy on dips.

Below current levels (1.44847), the pair finds initial support at 1.4806, followed by 1.4774 (50.0% Fib 1.4685 to 1.4859), 1.4755 and 1.4685.

Should the pair rise on further risk appetite, higher equity and commodity prices, the pair finds initial resistance at 1.4860.

Following this level, EUR/USD will encounter further resistance at 1.4928 and 1.4967.

Trading levels in play:

Since a bullish reversal is not confirmed, buy orders are risky. Please adjust exposure.

(Lower position size) Limit Buy @ 1.4756 Targets: T1 1.4776 – T2 1.4967 Risk: 1.4690
* After 15 pips profit move stop to entry, take profit at will. Trade is canceled if it rebounds near entry and moves higher by 20 pips. Comments will follow if outlook changes.

Popularity: unranked [?]

The Aussie rose sharply from its recent slump as risk appetite strengthen. A better than expected U.S. GDP report spurred investors back into riskier assets.

U.S. Real gross domestic product (GDP) increased at an annual rate of 3.5% in the third quarter of 2009, following a decline of 0.7% registered in the second quarter. The data printed above the expected expansion of 3.2%.

Looking at the 4hour chart,
AUD/USD found strong demand at 0.8954 where gains extended above 0.9000, to a post-U.S. GDP high of 0.9183.

Although higher prices are possible, a retracement from these levels is possible where renewed buying pressure should resume, subject to equities. A preferred near term bias looks to buy on dips.

From current levels (0.9141), AUD/USD will encounter initial support at 0.9113 , followed by 0.9045 (61.8% Fib 0.8954 to 0.9183) and 0.8870.

Initial resistance can be seen at 0.9183, followed by 0.9220 and 0.9269.

The long term bias for the pair remains bullish and support for the Aussie should resume at lower prices; parity is still expected. Rate differentials are starting to play a big role in currency markets.

Trading levels in play:

Since a bullish reversal is not confirmed, buy orders are risky. Please adjust exposure.

(Lower position size) Limit Buy @ 0.9054 Targets: T1 0.9074 – T2 0.9269 Risk: 0.8990
* After 15 pips profit move stop to entry, take profit at will. Trade is canceled if it rebounds near entry and moves higher by 20 pips. Will follow up with comments if outlook changes.

Popularity: unranked [?]

FXstreet.com (Barcelona) – The Yen has continued with its advance against the Dollar sparked by the risk aversion today’s Friday session. The USD/JPY has fallen around 140 pips form MA200 hourly chart at 91.30 to break MA55 hourly at 91.00, test 90.00 level and post 2-week low at 89.90.

Currently the pair is trading around 1.65% below today’s opening price action at 91.45. Dollar has lost yesterday’s gains to the Yen and is heading toward the first weekly decline after rising in the last four.

The FastBrokers Research Team comments: “A selloff is taking place in the riskier FX pairs and the USD/JPY is following suit, telling us investors prefer the Yen over the Dollar as a safe haven right now. Today’s strength in the Yen also stems from the BoJ’s decision to end a couple of its bond purchasing programs in an effort to tighten liquidity. Today’s monetary policy falls in line with the BoJ’s more conservative stance since the DPJ took office. Furthermore, the BoJ was likely encouraged by the USD/JPY’s recent solid performance above its important 90 threshold.”

For more information, read our latest forex news.

Popularity: unranked [?]