A temporary high may be close.
All in my humble opinion of course.
Saturday, February 24, 2007
USDCHF
USDCHF has been particularly weak against the $, not even notching up a 50% retrace of its recent high.
Hourly EURUSD
There are a number of ways of interpreting the advance off the lows, and unfortunately alot of possible res. levels above, but the large 78.6% Fibonacci retrace shouldn't be over looked, and Id be cautious about it seriously reversing with much trade above it.
Longer Term
i might include some multi-year charts on occasion, but in my opinion, a 3-month chart is more than long-term-enough in spot FX markets!
Given the long time span this weekly chart covers, Id suggest giving the 'levels' a little leeway, perhaps +/- 5pips. Incidentally on shorter timed charts(hourly, 15min etc) my levels are supposedly accurate, but I'd still allow +/- the spread(i do). My spread in USDJPY with CMCMarkets.com is 3pips.
Given the long time span this weekly chart covers, Id suggest giving the 'levels' a little leeway, perhaps +/- 5pips. Incidentally on shorter timed charts(hourly, 15min etc) my levels are supposedly accurate, but I'd still allow +/- the spread(i do). My spread in USDJPY with CMCMarkets.com is 3pips.
Friday, February 23, 2007
Trading Aid via Technical Analysis
The aim of this blog is to a) document analysis; and more importantly, b) aid trading, to make me more money!
Most market participants have a good or at least basic knowledge of price Support and Resistance. These Support and resistance(or 'supp.' and 'res.') levels may effect your current position or views.
For example if a security or product your interested in stops at a res. level, it may well pullback/retrace or completely turn around. If it breaks through a res. level, you may feel confident it will continue in this manner, and perhaps look for the next res. level. And of course vice-versa for supp.
The problems arise with what appears a simple enough form of analysis, when the securities or products(or 'markets') you follow encounter supp. or res. seemingly 'out of the blue', and may look to turn up and down randomly. Not encouraging when you have money on the line.
My analysis focuses on identifying meaningful supp. and res. levels, before they're met, allowing the observer to decide whether repositioning is required, once reaction with said level is taken into account.
This analysis and ultimately the 'levels', are derived from a number of ways, frequently something as straight forward as a previous high/low,(i.e. if a previous high is broken-up through, its a sign of strength, and the market could well continue in this manner, and vice-versa) or a combination of other studies. The 'levels' of interest appear as horizontal lines on my charts at the PRICE which is supp. or res., the wider the horizontal line, the more importance I place on that particular level. Naturally if current market price is below a horizontal line, the line represents res. and vice-versa. Standard Fibonacci retracements are signified with a 'slow dashed' horizontal line. 'Key levels' that may confirm/void a chart interpretation are shown with 'dotted' horizontal lines. Anything beyond these annotations I will detail on the charts.
(the above and below charts demonstrate the usefulness of identifying supp. and res. levels prior to the markets tracing them out. These charts and their annotations were of course drawn up after the market reacted to them, but were generated prior to the market reaching them.)
In the years I have been active in financial markets Ive concluded that technical analysis works best on the larger, more liquid markets. The more participants and the more trade, the more effective my analysis.
As a result, I focus on Spot FX USD majors - EURUSD, USDJPY, GBPUSD and USDCHF, and occasionally some more exotic crosses, equity Indices - Uk's FTSE100 and Germany's DAX, and some individual UK stocks.
I can/do look at US equities and indices, Treasury and Commod Futures but I'm not as active in those markets as I have less experience, so don't spend as much time looking at them.
Charts are taken from http://www.it-finance.com/, supplied to me via my FX broker http://www.cmcmarkets.com/ or http://www.igmarkets.co.uk/ .
*Nothing contained in this blog is meant as an invitation to trade any financial markets in any way shape or form, using any products. Speculation in financial markets carries a high degree of risk.*
So let's have a look :)
Most market participants have a good or at least basic knowledge of price Support and Resistance. These Support and resistance(or 'supp.' and 'res.') levels may effect your current position or views.
For example if a security or product your interested in stops at a res. level, it may well pullback/retrace or completely turn around. If it breaks through a res. level, you may feel confident it will continue in this manner, and perhaps look for the next res. level. And of course vice-versa for supp.
The problems arise with what appears a simple enough form of analysis, when the securities or products(or 'markets') you follow encounter supp. or res. seemingly 'out of the blue', and may look to turn up and down randomly. Not encouraging when you have money on the line.
My analysis focuses on identifying meaningful supp. and res. levels, before they're met, allowing the observer to decide whether repositioning is required, once reaction with said level is taken into account.
This analysis and ultimately the 'levels', are derived from a number of ways, frequently something as straight forward as a previous high/low,(i.e. if a previous high is broken-up through, its a sign of strength, and the market could well continue in this manner, and vice-versa) or a combination of other studies. The 'levels' of interest appear as horizontal lines on my charts at the PRICE which is supp. or res., the wider the horizontal line, the more importance I place on that particular level. Naturally if current market price is below a horizontal line, the line represents res. and vice-versa. Standard Fibonacci retracements are signified with a 'slow dashed' horizontal line. 'Key levels' that may confirm/void a chart interpretation are shown with 'dotted' horizontal lines. Anything beyond these annotations I will detail on the charts.
(the above and below charts demonstrate the usefulness of identifying supp. and res. levels prior to the markets tracing them out. These charts and their annotations were of course drawn up after the market reacted to them, but were generated prior to the market reaching them.)
In the years I have been active in financial markets Ive concluded that technical analysis works best on the larger, more liquid markets. The more participants and the more trade, the more effective my analysis.
As a result, I focus on Spot FX USD majors - EURUSD, USDJPY, GBPUSD and USDCHF, and occasionally some more exotic crosses, equity Indices - Uk's FTSE100 and Germany's DAX, and some individual UK stocks.
I can/do look at US equities and indices, Treasury and Commod Futures but I'm not as active in those markets as I have less experience, so don't spend as much time looking at them.
Charts are taken from http://www.it-finance.com/, supplied to me via my FX broker http://www.cmcmarkets.com/ or http://www.igmarkets.co.uk/ .
*Nothing contained in this blog is meant as an invitation to trade any financial markets in any way shape or form, using any products. Speculation in financial markets carries a high degree of risk.*
So let's have a look :)
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