Technical Templates

[Sarah Foster]

Watch the price action around last weeks highs where there's also some prior s&r traffic highlighted on charts further up the thread.

I wouldn't become married to any long bets just yet if I were you, but it's ok to take small bites out of it whilst the hourly momentum signals continue to give the go-ahead (via higher lows).

Hi goldtop.
I assume that prior s&r traffic you referred to in your post is the support from 18th May which then provided resistance a week later?
I certainly agree with your warning about prices needing to breakthrough last weeks highs before adding confidence to executing longs. I also still see EURUSD as bearish underneath that level, with this weeks action merely a minor corrective move (to be shorted into) until 1.2650 is cleared & tested.

[goldtop]

That 2620-50 area originates from the middle of January Sarah.
That was the first rejection zone that propelled prices back up to the current years highs & the first time it was re-tested was during the period you just mentioned back last month.
It's now acting as initial resistance (which along with primary directional momentum, is the basis of this whole concept/thread) & given we're still deep in short (bearish) territory, the higher probability bet for those taking a more medium term view, is to short into these corrective moves.

Of course, there's nothing wrong in betting the upside on these corrective price action moves for those so inclined, but like I said in my earlier post you need to monitor those bets very closely & take a much more aggressive trade management view becuase they're lower probability trades.

[xerb]

And if this weeks hourly higher low support doesn't come to it's rescue on the next test, the short lived corrective action really does resume it's primary impulse move back towards the years lows.

The 1.2440 level represents the average day's range for Friday's session.

[kipper]

That 2620-50 area originates from the middle of January Sarah.
the first time it was re-tested was during the period you just mentioned back last month.
It's now acting as initial resistance & given we're still deep in short (bearish) territory, the higher probability bet for those taking a more medium term view, is to short into these corrective moves.

Pretty cool how it got swiftly beaten down again yesterday off that bearish zone goldtop!
Not much joy for those betting short into today's action though. It's looking quite resiliant every time it threatens friday's low area.

I've just scratched a breakeven short from earlier this morning. I was looking for a move down to last week's lows @ 1.24 which is also today's ADR, but not to be....well not today anyway.

[strobe]

If you're really tempted to trade euro at the moment kip, flick through the watch-list & look for the instruments that are exhibiting the clearer structural set ups such as the kiwi or aussie.

If you compare the 4&1 hour moving average slope (& hooks) on euro/kiwi for instance as opposed to euro/dollar, you'll quickly notice a much smoother journey.
I think the recent chart uploads on here have confirmed the importance (& value) of betting euro/dollar away from key s&r zones kipper, such as that highlighted 2620-50.
Those areas are definitely where the keener odds are to be found & the less whippy intraday volatility.
Whereas via the crosses, although trading away & into visible zones of s&r is still key for stacking the odds in our favour, the price action is, in my opinion, more noticeably smoother & less inclined to jerk you all over the (intraday) field.

[kipper]

If you're really tempted to trade euro at the moment kip, flick through the watch-list & look for the instruments that are exhibiting the clearer structural set ups such as the kiwi or aussie.

If you compare the 4&1 hour moving average slope (& hooks) on euro/kiwi for instance as opposed to euro/dollar, you'll quickly notice a much smoother journey.

You're absolutely correct strobe, & it's a good point you make regards the angle of the slope in relation to the price action.
The average on the 4 hour has been flattening out since beginning of last week & price has been criss crossing with no real directional focus....not a good sign for these types of set ups or triggers.

Note to self: pay more attention to the basic structure before considering getting involved!

[West]

You're absolutely correct strobe, & it's a good point you make regards the angle of the slope in relation to the price action.
The average on the 4 hour has been flattening out since beginning of last week & price has been criss crossing with no real directional focus....not a good sign for these types of set ups or triggers.

A tool I have found very useful is a currency relative strength index chart. Search for FXTSP/relative strength index chart (I'm not punting their website-I'm sure there are others out there). Its a useful way of visualizing where the major flows have been over the last two weeks or so. I simply note the strongest/weakest currencies and then look for the cleanest trending price action on those pairs. As Strobe showed in those charts, it was indicating NZD & AUD strength on Monday and that's continued throughout the week. It's not foolproof, but it does help to determine which pairs should be on my watch list. Might be helpful for anyone new getting caught up in the wippy price action on some pairs of late.

[jack mason]

West is right, you can get a pretty good indication of comparable strength/weakness & thus quickly focus in on the most appropriate pairings via something like a graph or heatmap.

Another alternative is to simply take a browse through the futures charts & compare the same information across the relevant currencies.
Try this site. It offers a selection of timeframes from which to view the info dependant on your trading objectives.
http://finviz.com/futures_charts.ashx?t=CURRENCIES&p=h1

You can quickly see from the selection below that the focal choice of strength is; Euro, Swiss, Kiwi & Aussie & the obvious standout weakness is the U.S Dollar.
From that, you could simply dial into your EUR/USD, USD/CHF, NZD/USD & AUD/USD to see which pair are setting up according to the usual trigger criteria discussed on here.

There's bound to one or more keying into or away from a juicy support/resistance zone with accompanying hourly/sub-hourly hook combo.
Failing that, just wait until one of those pairs sets up & triggers in line with the current bias on a 15m or 60m view & get in on a hook or favorite entry set up.

[round number]

Thanks West/Jack, that's very helpful
I've been compiling separate templates in MT4 in all the major currency pairs & scrolling through them at the end & beginning of each week to obtain a general heads up.

Both of your ideas are much easier & more efficient methods of identifying the primary pairs to trade though & will replace my clunky efforts with one of those!
It did at least identify the New Zealand Dollar as the strong arm currency this week & I've been patiently picking at it via the euro & the buck off the 15 minute hooks.
I can't believe how fast I've progressed & how much more confidence I've attained by trading via this simple structure. I wish I'd stumbled on this thread & you guys 3 years ago!!

[round number]

Guys,
Could you cast your eyes across these 2 pairs & ensure I've marked off the relevant s&r zones please.

I'm ok with the current 7880-7900 area on nzd/usd & I've earmarked the 1st support zone on any pullback to the 4 hour 60ma area around those higher lows at 7670-7700, but could you confirm my next primary resistance zone is the 8050-90 zone? It appears the most logical technical area that price will get driven towards.



Also I've got aud/nzd on my watch list too & again, I'm ok with the area that price is now bumping heads with at 1.2750-80 as it's a very clear previous support & resistance area right back from February/March through to last month & now this month. The next possible support zone however is a little cloudy for me.

I'm looking to short this pair if it offers me a break/pullback out of this current s&r zone & given the smallish ADR, I'm wondering whether the area I've highlighted with the question mark (2620-50) trumps the lower swing support at 2515-40 as my initial target profit zone?