Technical Templates

[jack mason]

There are 3 main fixings across the trading day Jack.
Their primary function is to accommodate 'best transparent dealing price' for clients & is mainly engineered by asset managers.

Much obliged Jim.
It's interesting to know how & why these events spin out across the trading day, even if they don't unduly affect what I'm doing. It all adds to the general flavor of the price action & helps explain when the price behaves erratically or outside what's normally expected at certain times during the day.

It's similar to the type of occasional price action seen around important Option barrier defenses at big figures & the regular stop hunting events that take place after New York closes & into the late morning of the Tokyo sessions......
.....those that are, certainly need to be on their toes & on the look out for the obvious stop levels on the higher volume pairings when the Australasian dealers are on the hunt for those stops.

I guess this particular window of the trading day is more attractive for hunting stops due to the lower liquidity levels?
From reading & interpreting the stuff you guys have imparted, I'd imagine it wouldn't take nearly as much cash to push & pull prices around during the doldrums period between the New York close & the start of the Tokyo session. Having said that, there are occasionally some really nice trendy moves during Tokyo, especially during their afternoon session leading into the early european open.

Those 1-2-3 & momentum triggers mentioned on here recently are excellent set ups to take advantage of decent value bets when the volumes begin opening out…

Now that I most definitely agree with!!
I'm having more success with those two set ups than anything else I've used since starting live trading, particularly the momentum pullback set up as it moves away from some of the important levels you've earmarked consistently on here.

I haven't traded too many 1,2,3's during the past few weeks, but those I have traded are returning a high hit rate.

[JimmyMac]

It's similar to the type of occasional price action seen around important Option barrier defenses at big figures & the regular stop hunting events that take place after New York closes & into the late morning of the Tokyo sessions......
.....those that are, certainly need to be on their toes & on the look out for the obvious stop levels on the higher volume pairings when the Australasian dealers are on the hunt for those stops.

I guess this particular window of the trading day is more attractive for hunting stops due to the lower liquidity levels?
I'd imagine it wouldn't take nearly as much cash to push & pull prices around during the doldrums period between the New York close & the start of the Tokyo session.

It's more prevalent when prices are pushed close to previously reactive levels or traded outside of their average range boundaries as New York dealers hand over to their Asian counterparts.

Certainly if stops are located within 25-35% of the average range as Sydney & Tokyo open up the doors for business, they'll be vulnerable. It's quite a low risk play when business is reasonably quiet & a desk or two can generate a snowball effect to run prices thru a recognized supply or demand zone.

[jack mason]

Looks like the MoF/BoJ stepped in during their business session today to scare off speculators again?!
Think they're sending out a message that 84.0 is the line in the sand guys?

I guess they're also trying to encourage Japanese exporters to consider setting their hedging levels a little higher than 86.0? Looking at the supply & demand channel on that pair that would appear a likely area of offers on any substantial intervention money hitting the market.

I bought a little eur/jpy on Tuesday above 112.0 when it pulled back, mainly on the back of positive Euro flows & the backdrop of likely renewed intervention.

Looking at that pairs supply & demand potential, that upper level looks appealing if the momentum can break out & hold the summer resistance 115.0 area.
The lower demand box around 111.0 would probably begin attracting bids if Euro remained buoyant on pullbacks?

[Joe Whitehorse]

Looks like the MoF/BoJ stepped in during their business session today to scare off speculators again?!
Think they're sending out a message that 84.0 is the line in the sand guys?

It doesn't smell like a typical ramp up in Bank activity to me Jack. If it was then it was a piss poor & rather clumsy attempt to wave their big stick.

Rumors have been doing the rounds on the squawks & wires that the Banks governer Shirakawa is about to tender his resignation, although as per the norm the BoJ are strenuously denying the leak.

Month & quarter end are now on the radar of the funds & desks, so they'll be an uptick in volumes & erratic pockets of activity as they look to square up & readjust weightings into the final trading quarter of the year.
I guess we'll get a better idea to the Jap spike up in prices as London & New York wires begin stirring.

[JimmyMac]

Looking at the supply & demand channel on that pair 86.0-86.50 would appear a likely area of offers on any substantial intervention money hitting the market.

I'd certainly agree that's the next fulcrum level on the upside Jack.
It's been over a month since prices have breathed the air inside your supply channel & as you rightly say, exporter offers will be tiered in there amongst buy stops.
September 30 bookmarks the Japanese fiscal half year so that's on the agenda of these corporates too.

The main objective of this round of intervention activity is to put doubts into speculators minds. The idea is to keep them guessing about the levels & timing of any future moves. Trouble is, once the market gets a read on the absorption levels they'll simply begin feeding in offers on any spike moves into supply levels.
Gradually the impact of the intervention tactic dissipates & prices return to pre-intervention levels where the "market" then dictates & agrees fair value.

I bought a little eur/jpy on Tuesday above 112.0 when it pulled back, mainly on the back of positive Euro flows & the backdrop of likely renewed intervention.
Looking at that pairs supply & demand potential, that upper level looks appealing if the momentum can break out & hold the summer resistance 115.0 area.

Betting long is definitely the better of the two options if the corresponding pair is Yen based.
Certainly in the current climate anyhow.

This corridor up to 114.25 is a heavy supply area to get through. But you're on the right side of the momentum for now. If it does manage to negotiate this busy zone there's plenty of clean air to the top side!
If you haven't already done so, it might be prudent to book a little profit anywhere around 113.50.

[spotfx]

September 30 bookmarks the Japanese fiscal half year so that's on the agenda of these corporates too.

The main objective of this round of intervention activity is to put doubts into speculators minds. The idea is to keep them guessing about the levels & timing of any future moves. Trouble is, once the market gets a read on the absorption levels they'll simply begin feeding in offers on any spike moves into supply levels.

Gradually the impact of the intervention tactic dissipates & prices return to pre-intervention levels where the "market" then dictates & agrees fair value.

Those are good points Jim, & borne out by the current price action behavior since the last Friday's knee-jerk spike.
Orders (stops) were being stacked underneath last weeks lows & the pullbacks have simply been smothered with more short orders, most of it via fast money according to the chatter.

With today closing out Jap fiscal half year end I guess the MoF/BoJ will be eyeing this 82-83.0 channel as a possible intervention trigger. If not, then it could get real messy if prices are allowed to penetrate 82.85.

[jack mason]

Orders (stops) were being stacked underneath last weeks lows & the pullbacks have simply been smothered with more short orders, most of it via fast money.

MoF/BoJ will be eyeing this 82-83.0 channel as a possible intervention trigger. If not, then it could get real messy if prices are allowed to penetrate 82.85.

A month on from your last usdjpy post Bobby & this pair has indeed plumbed a further 3 big figures into the mess.
I doubt we'll see much in the way of serious stick waving from the Bank of Japan until they get to see the color of the Fed's next stage of proposed Quantitative Easing agenda?

Next weeks FOMC meeting will be eagerly watched by all concerned.

It certainly looks as though the offers were heavy above the previous weeks highs at 82 when longs attempted to test the stops on Wednesday. I guess the volumes aren't great on this pair at current levels given the threat of a second round of intervention, but it's cool to see how the short orders picked up the pace as prices fell through your aforementioned 82.85 earlier this month!


What I did enjoy was the unsurprising reaction on Cable to the comments coming out on the newswires during Thursday regards the UK's toning down of the potential QE requirements. It certainly received a welcome shot in the arm!!!
Whoever missed the first kick (circled) got a second chance to catch the move as it shifted through the local resistance at 1.5860.


It now opens up the mid October high above 1.61 followed by the the late January highs at 1.6270.
If it should slip from current levels I have the resistance/support flip zone at 5875 as 1st line support followed by the 2nd tier of 5725-50.

[Carll]

Whoever missed the first kick (circled) got a second chance to catch the move as it shifted through the local resistance at 1.5860.
It now opens up the mid October high above 1.61 followed by the the late January highs at 1.6270

Nice going on that forward analysis clip Jack.
Not surprising to witness profit takers cashing in at that 6270 into the end of last week ahead of the key data.


Price has now slipped back this morning to test the first of those upper resistance areas at 1.61 searching out renewed bids to support the action into the beginning of the week.
If the bids fail to shoulder it here they'll likely go for a test back towards last weeks lows @ 1.5960.

[shona123]

It now opens up the mid October high above 1.61 followed by the the late January highs at 1.6270
If it should slip from current levels I have the resistance/support flip zone at 5875 as 1st line support followed by the 2nd tier of 5725-50

I hope you traded price back off that 6270 failure to your aforementioned support levels since you conducted your planning on this pair at the beginning of the month.

Nice bounce last week off 875 to offer another shot at picking up a lower high continuation short Monday down to your secondary identified area of support earlier today.

Things might begin to get a little hairy after this week with the usual reduction in liquidity & inflated intra-week volatility, but this has been a nice trade to get involved in.
Well analyzed Jack!

[jack mason]

I hope you traded price back off that 6270 failure to your aforementioned support levels since you conducted your planning on this pair at the beginning of the month.

Hey Shona
I was away on brief vacation break for the first few days of this month so didn't take my first bite out of it until the 11th - shorting through 1.6110.
Got stopped out on that attempt, but took it on again at the same price on the 15th for a decent ride down to my first s&r level.
I've only got back in short again yesterday actually as it fell through 5875 & am still holding it.

Things might begin to get a little hairy after this week with the usual reduction in liquidity & inflated intra-week volatility,

I'm not planning to do much trading after the end of this month to be honest. As you say conditions tend to get silly with all the liquidity being sucked out of the market. Technical levels simply don't hold up too well around this time of the year.

When are you guys starting to wind things down this year?
I guess you're in Thanksgiving party mode tomorrow/this weekend!!