Best of the Week
Most Popular
1. US Housing Market Real Estate Crash The Next Shoe To Drop – Part II - Chris_Vermeulen
2.The Coronavirus Greatest Economic Depression in History? - Nadeem_Walayat
3.US Real Estate Housing Market Crash Is The Next Shoe To Drop - Chris_Vermeulen
4.Coronavirus Stock Market Trend Implications and AI Mega-trend Stocks Buying Levels - Nadeem_Walayat
5. Are Coronavirus Death Statistics Exaggerated? Worse than Seasonal Flu or Not?- Nadeem_Walayat
6.Coronavirus Stock Market Trend Implications, Global Recession and AI Stocks Buying Levels - Nadeem_Walayat
7.US Fourth Turning Accelerating Towards Debt Climax - James_Quinn
8.Dow Stock Market Trend Analysis and Forecast - Nadeem_Walayat
9.Britain's FAKE Coronavirus Death Statistics Exposed - Nadeem_Walayat
10.Commodity Markets Crash Catastrophe Charts - Rambus_Chartology
Last 7 days
Stock Market Dow 30k before End of 2020? - 13th Jul 20
Credit Market Investments Turned Into End-User Risk Again - 13th Jul 20
Investors Are Going All-In on This Coronavirus Proof Industry - 13th Jul 20
5 Vital Insights That You Can Gain From Instagram Trackers - 13th Jul 20
Stop Believing The 'Economy' Is The Same As The Stock Market - 12th Jul 20
Spotify Recealed as The “Next Netflix” - 12th Jul 20
Getting Ahead of the Game: What Determines the Prices of Oil? - 12th Jul 20
The Big Short 2020 – World Pushes Credit/Investments Into Risk Again - 11th Jul 20
The Bearish Combination of Soaring Silver and Lagging GDX Miners - 11th Jul 20
Stock Market: "Relevant Waves Vs. Irrelevant News" - 10th Jul 20
Prepare for the global impact of US COVID-19 resurgence - 10th Jul 20
Golds quick price move increases the odds of a correction - 10th Jul 20
Declaring Your Independence from Currency Debasement - 10th Jul 20
Tech Stocks Trending Towards the Quantum AI EXPLOSION! - 9th Jul 20
Gold and Silver Seasonal Trend Analysis - 9th Jul 20
Facebook and IBM Tech Stocks for Machine Learning Mega-Trend Investing 2020 - 9th Jul 20
LandRover Discovery Sport Service Blues, How Long Before Oil Change is Actually Due? - 9th Jul 20
Following the Gold Stock Leaders as the Fed Prints - 9th Jul 20
Gold RESET Breakout on 10 Reasons - 9th Jul 20
Fintech facilitating huge growth in online gambling - 9th Jul 20
Online Creative Software Development Service Conceptual Approach - 9th Jul 20
Coronavirus Pandemic UK and US Second Waves, and the Influenza Doomsday Scenario - 8th Jul 20
States “On the Cusp of Losing Control” and the Impact on the Economy - 8th Jul 20
Gold During Covid-19 Pandemic and Beyond - 8th Jul 20
UK Holidays 2020 - Driving on Cornwall's Narrow Roads to Bude Caravan Holiday Resort - 8th Jul 20
Five Reasons Covid Will Change SEO - 8th Jul 20
What Makes Internet Packages Different? - 8th Jul 20
Saudi Arabia Eyes Total Dominance In Oil And Gas Markets - 7th Jul 20
These Are the Times That Call for Gold - 7th Jul 20
A Reason to be "Extra-Attentive" to Stock Market Sentiment Measures - 7th Jul 20
The Beatings Will Continue Until the Economy Improves - 6th Jul 20
The Corona Economic Depression Is Here - 6th Jul 20
Stock Market Short-term Peaking - 6th Jul 20
Gold’s Major Reversal to Create the “Handle” - 5th July 20
Gold Market Manipulation And The Federal Reserve - 5th July 20
Overclockers UK Custom Build PC Review - 1. Ordering / Stock Issues - 5th July 20
How to Bond With Your Budgie / Parakeet With Morning Song and Dance - 5th July 20
Silver Price Trend Forecast Summer 2020 - 3rd Jul 20
Silver Market Is at a Critical Juncture - 3rd Jul 20
Gold Stocks Breakout Not Confirmed Yet - 3rd Jul 20
Coronavirus Strikes Back. But Force Is Strong With Gold - 3rd Jul 20
Stock Market Russell 2000 Gaps Present Real Targets - 3rd Jul 20
Johnson & Johnson (JNJ) Big Pharma Stock for Machine Learning Life Extension Investing - 2nd Jul 20
All Eyes on Markets to Get a Refreshed Outlook - 2nd Jul 20
The Darkening Clouds on the Stock Market S&P 500 Horizon - 2nd Jul 20
US Fourth Turning Reaches Boiling Point as America Bends its Knee - 2nd Jul 20
After 2nd Quarter Economic Carnage, the Quest for Philippine Recovery - 2nd Jul 20
Gold Completes Another Washout Rotation – Here We Go - 2nd Jul 20
Roosevelt 2.0 and ‘here, hold my beer' - 2nd Jul 20
U.S. Dollar: When Almost Everyone Is Bearish... - 1st Jul 20
Politicians Prepare New Money Drops as US Dollar Weakens - 1st Jul 20
Gold Stocks Still Undervalued - 1st Jul 20
High Premiums in Physical Gold Market: Scam or Supply Crisis? - 1st Jul 20
US Stock Markets Enter Parabolic Price Move - 1st Jul 20
In The Year 2025 If Fiat Currency Can Survive - 30th Jun 20
Gold Likes the IMF Predicting a Deeper Recession - 30th Jun 20
Silver Is Still Cheap For Now - 30th Jun 20
More Stock Market Selling Ahead - 30th Jun 20
Trending Ecommerce Sites in 2020 - 30th Jun 20
Stock Market S&P 500 Approaching the Precipice - 29th Jun 20
APPLE Tech Stock for Investing to Profit from the Machine Learning Mega trend - 29th Jun 20
Student / Gamer Custom System Build June 2020 Proving Impossible - Overclockers UK - 29th Jun 20
US Dollar with Ney and Gann Angles - 29th Jun 20
Europe's Banking Sector: When (and Why) the Rout Really Began - 29th Jun 20
Will People Accept Rampant Inflation? Hell, No! - 29th Jun 20
Gold & Silver Begin The Move To New All-Time Highs - 29th Jun 20
US Stock Market Enters Parabolic Price Move – Be Prepared - 29th Jun 20
Meet BlackRock, the New Great Vampire Squid - 28th Jun 20
Stock Market S&P 500 Approaching a Defining Moment - 28th Jun 20

Market Oracle FREE Newsletter

AI Stocks 2020-2035 15 Year Trend Forecast

Forex Trading Management: The Importance of Being Prepared

Currencies / Forex Trading Feb 19, 2019 - 06:28 PM GMT

By: Nadia_Simmons

Currencies

There is this pearl of wisdom in the trading world. Plan the trade and trade the plan. We have just seen the importance thereof in the EUR/USD pair. It had positive direct implications for us and you, the subscriber. Does the above influence our outlook on the other currency pairs? Is there any corresponding action to take?


EUR/USD – The Decline on Cue

On the weekly chart, we see the pair is testing the lower border of the blue consolidation. The weekly indicators are still positioned in a bearish way (CCI, the most short-term sensitive one, has not flashed any buy signal yet).

Moving to the daily chart, on Friday we wrote:

(…) currency bulls didn’t manage to change the technical picture significantly. There was no break above the first chart resistance nearby, the 23.6% Fibonacci retracement.

The pair pulled back and closed the day below the above mentioned resistance. (...) It’s becoming increasingly probable that we’ll see a realization of the bearish scenario and a test of the red declining support line in the very near future.

Below this declining red support line, there is also the lower border of the blue declining trend channel, which may be an additional factor that could encourage the bulls to act in the following days. The two most recent white candles support the likelihood of the exchange rate willing to put up a fight before any further moves down.

Therefore, we decided to close our already profitable short positions and take profits off the table if EUR/USD declines to our downside target.

The situation developed in line with our assumptions and EUR/USD rebounded after a drop to our exit target. Thanks to this downswing, our short positions were automatically closed by the waiting exit order (our subscribers were prepared in advance), increasing our trading capital for a third time in a row.

What’s next for the exchange rate?

Friday’s move created a candlestick with a long lower shadow, which shows heavy participation of currency bulls in the move. Yesterday, they built up on the gains and EUR/USD came back above the previously broken green zone. The daily indicators are not positioned negatively for such an upside move. Taking these into account, the pair could very well test the 38.2% Fibonacci retracement in the near future.

As a reminder, this important resistance was strong enough to stop the bulls in the previous week. If the pair has enough power to indeed approach it (at the moment of writing these words, it’s trading at around 1.1285 – which is back inside the green support zone), we’ll pay close attention to the bulls’ strength as it would give us more clues about likely future moves.

If they break above the 38.2% Fibonacci retracement, we’ll likely see next a test of the 50% Fibonacci retracement followed by the previously broken lower border of the brown rising trend channel. However, if they fail, another retest of the major supports and latest lows will be in cards once again and thus we’ll consider reopening short positions.

USD/CAD – Still Inside the Consolidation

On Wednesday, currency bears tried to go south, but the previously broken red support line stopped them. The bulls invalidated the breakdown and triggered a rebound that took the pair back into the consolidation.

Thursday’s upswing and took USD/CAD well into the upper border of the yellow consolidation. Despite the increase, this improvement was very temporary and the exchange rate turned south the day after, invalidating the earlier tiny breakout.

This triggered further deterioration and the pair came back to the lower line of the formation, approaching the previous low and the red rising support line. Nevertheless, there was no daily close below the consolidation, which encouraged the bulls to act earlier today.

As a result, the pair erased yesterday’s drop. It suggests that another attempt to reach the upper border of the yellow consolidation may be just around the corner. We will keep you, our subscribers, informed should anything change, or should we see a confirmation/invalidation of the above.

USD/CHF – Another Consolidation

Although currency bears pushed USD/CHF below the lower border of the blue rising wedge at the start of last week, this tiny breakdown was quickly invalidated. A sharp move to the upside followed and the pair looked like it could test the upper border of the rising wedge formation in the very near future.

USD/CHF indeed moved higher till Wednesday, pulled back on Thursday and had a daily reversal on Friday to end the week on a bearish note. This resulted in the exchange rate breaking below the lower border of the rising blue wedge.

But for now, the pair remains still inside the blue consolidation and before another bigger move down, we would first need to see a decisive daily close below the consolidation. If the bears show strength in the following days, we’ll consider opening short positions. We will keep you, our subscribers, informed should anything change, or should we see a confirmation/invalidation of the above.

If you enjoyed the above analysis and would like to receive free follow-ups, we encourage you to sign up for our daily newsletter – it’s free and if you don’t like it, you can unsubscribe with just 2 clicks. If you sign up today, you’ll also get 7 days of free access to our premium daily Oil Trading Alerts as well as Gold & Silver Trading Alerts. Sign up now.

Nadia Simmons
Forex & Oil Trading Strategist
Przemyslaw Radomski
Founder, Editor-in-chief

Sunshine Profits: Gold & Silver, Forex, Bitcoin, Crude Oil & Stocks
Stay updated: sign up for our free mailing list today

* * * * *

Disclaimer

All essays, research and information found above represent analyses and opinions of Nadia Simmons and Sunshine Profits' associates only. As such, it may prove wrong and be a subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Nadia Simmons and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Nadia Simmons is not a Registered Securities Advisor. By reading Nadia Simmons’ reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Nadia Simmons, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules