Archive for November, 2008

Winds of Change

Monday, November 24th, 2008

I know… I know… some of you will say its to soon to say the market is on its way for a large retracement phase, but I think it will… take a look at the following chart:


That triangle is gone… usually triangles break in direction of the trend, but this wasn’t the case, it broke against it… Now, if you pay close attention there also another formation there… A double bottom (validated with the break of the main resistance line). So, from my point of view, this would be the start of a retracement phase, being 1.3346 our first target. Only time will tell…

We have several currency pairs in the same scenario, including: USDCHF, GBPUSD, GBPJPY, EURJPY, AUDUSD and USDCAD.

Good luck in your week!

Regards,

RL

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Markets advance, are they ready to go north?

Friday, November 14th, 2008

No, I don’t think so.

Today I’ve got plenty of mails asking what my thoughts are about the rebound we saw today, most thought the market are ready to head north. But let me tell you something, when the markets (or economies) are in good shape, usually the indexes do small but constant increments, not as the one we saw today.

Lately we have seen many strong ups and downs and this only means one thing: uncertainty of investors of where the market should be heading.

Anyways, be careful with your trading decisions. These days we should take special attention on important levels, if the market breaks one important level, it should head for the next one, but done expect another break, take profits there, because bounces could be wild.

Good luck!

RL

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Somebody did trade this triangle?

Thursday, November 13th, 2008

It is well known that the Euro/dolar is in a downtrend since early August. This triangles tend to be continuation patterns, thus breaking in direction of the long term trend is what we should expect.

Luckily this one wasn’t the exception :)

¿Where should is the best place to set our take profit orders?

What I would do here is watch closely what happens around 1.2337 (previous low), I need to make sure it doesn’t create a double bottom, if I see the market retracing back at that level, the best thing to do is close that trade. But if we see a break out, then it could go further down, probably around 1.2000, its next psychological support level.

Cheers!

RL

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Euro update

Monday, November 3rd, 2008

As I pointed out in my last post, if the Euro broke the 1.2980 for the upside, it was likely to reach 1.3350… guess what, we missed our target for 50 pips, its highest point was 1.3297, anyway I hope you profit from that break out.

Now the conditions have changed a bit, it is trading below 1.2673 and entered the sell zone. So I will start looking for a short opportunity in the EURUSD targeting the bottom of the range 1.2360sh (blue rectangle). Be careful though, if the market trades again above 1.2673 all shorts must be closed and start looking for long opportunities.


Have a nice week!

RL

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