A reversal of trend in eur/aud and gbp/aud looks probable

You see how gbp/usd and gbp/jpy were going up recently as I had predicted. The same is happening to aud/jpy pair (look my previous post). The breakout in the pair was real and we will probably see even higher prices very soon. 

Today I looked at eur/aud and gbp/aud pairs and I saw a reversal of a downward trend coming. If you analyze gbp/aud more carefully you will see that it is at a very important resistance on daily chart. It has also formed a reversal pattern (123 structure) on 4 hour chart. The same picture can be seen on eur/aud. The pair has already made a higher high and higher low, which is a clear technical indication of upcoming higher prices. It has to take the barrier of 1.2460 lying ahead though. 

gbp/aud looks even stronger. It seems to have broken the breakout point of 1.4915. The price has retraced a little, but my sixth sense tells me that we will probably see a move up. As always, try to apply your own sound judgment to make your own decisions and do not trust everything I say.

Hope this short trend analysis was useful.

See also:

Triangle pattern

Swing trading strategies

Forex news

Disclaimer

Trading financial markets carries a high level of risk, and may not be suitable for all investors. All information on the blog is of educational nature and cannot be considered as advice, recommendation or signals to trade in any financial markets.

Trend for 12th of September 2011

Hello those who enjoy reading my daily trend analysis. Let me today come back to my prediction regarding aud/jpy pair. If you remember I said that I expected it to rise as it had reached some support level and bounced of it. Unfortunately it did not happen. Now, what do you do if the move does not continue and you are not able to follow the price in the direction you expected it to go? Well, you just go the other direction. How? By trading a reversal and a breakout of support or resistance (in this case support). 

So, if you look at the chart I gave yesterday and compare it with today’s you see what I mean. Our prediction can never be one hundred percent right. We should always have plan B, C and maybe even D and E. If you see a pair bouncing from support it does not mean that it can do it for a long time. A breakout downwards can be very soon. That’s what happened today. The pair just plunged through support and that’s it. 

So, one could simply place a short order below the support level that is indicated in the chart and go together with the market if the breakout is not false (and it was not). The pair is at intermediary support now, but will probably go lower to another support level, which is at 77.00. I really expect the security to find its’ bottom there, reverse and go up again. Why? Because I expect commodities to go up and this means that Australian, Canadian and maybe New Zealand dollar pairs will continue going up against other currencies. Hope I am right.

See you tomorrow.

See also:

Breakout

Divergence

Resistance

Disclaimer

Trading financial markets carries a high level of risk, and may not be suitable for all investors. All information on the blog is of educational nature and cannot be considered as advice, recommendation or signals to trade in any financial markets.

Trend for 7th of September 2011

Hi, to those who enjoy trend trading analysis and enjoy analyzing markets daily. So, markets basically continue going in the direction they have started. From the negative point of view I see that eur/gbp did not continue its’ downward move. So, in this aspect my prediction was not right. However, eur/aud, which I identified as the leader in the move continued going down. EUR/CAD was going nowhere, but I think it is temporary and the downtrend will resume sooner rather than later. 

I am also looking at gbp/jpy and think whether the pair is going to go down through the floor or it has found its’ solid bottom. I would encourage you to look at daily and weekly charts of the security to make your own analysis and prediction. When you look you will see that the gbp/jpy is at the multi year low and probably jump off the level it is sitting on at the moment. So, in this kind of situation a breakout trader would place a sell stop below the support and wait for a breakout and a range trader would wait for a reversal and after seeing a reversal pattern formed would go up. It is best to wait and see at real market conditions and react accordingly. 

See also:

Breakout

Range

Follow the leader

Disclaimer

Trading financial markets carries a high level of risk, and may not be suitable for all investors. All information on the blog is of educational nature and cannot be considered as advice, recommendation or signals to trade in any financial markets.

Trend for 30th of August 2011

Hi, fellow fans of financial markets and trend analysis lovers. Today I wanted to stress the importance of following a leader principle. I have a special post on the topic and you will see the link at the end of the post. I mentioned that I expect Canadian dollar to strengthen and Japanese Yen to weaken. Yen has been weakening for some time against some currencies, but Canadian dollar not strengthening yet. As I looked through major pairs today, I saw that a much better candidate for going short Euro is not eur/cad, but eur/aud. Why is that?

EUR/CAD is still kissing the resistance and going nowhere, while eur/aud managed to break its’ support and is bellow it now. Looking at other Euro pairs you see that aussie is the strongest at the moment and managed to take power over Euro first. It means the pair might be the leader in a bearish move, which is going to be against Euro. One has to place the biggest bets on the leader. The same pattern can be seen in Japanese Yen pairs. Australian dollar is the strongest among them. 

In fact, Yen is still pretty strong against most currencies, or in the same manner as Canadian dollar, not going anywhere yet. But aud/jpy is strengthening and eur/aud is weakening. Does it say anything to you about the leader in forex market. Yes, you guessed right, the biggest winner will probably be aussie. I think it is wise to be with winner and avoid losers. These are only my predictions. You have to make your own and rely on your own reasoning. But never forget that the principle I am discussing right now is very important. Hope you see that.

See also:

Follow the leader

EUR/AUD

Disclaimer

Trading financial markets carries a high level of risk, and may not be suitable for all investors. All information on the blog is of educational nature and cannot be considered as advice, recommendation or signals to trade in any financial markets.

Market trend analysis for 27th of July 2011

US in serious trouble

 

Hi, everyone. Let us do market trend analysis for today. Nobody believed that the second wave of crisis was possible one year ago. Like always, there were some people that were shouting about it, but their voices were never listened to and the vast majority of people never really heard the message that those voices were delivering. Now, every day is uncertain for a bankruptcy of United States is more than a possibility. It is just a matter of time.

Wait for opportunities to sell the greenback

 

Although most currencies fell against US dollar today, I do not think this is a long term phenomena. In my opinion dollar will collapse soon. EUR/USD is at support now and will probably continue its’ ascend sooner rather than later. Much depends on the decision that the US government will make regarding debt ceiling. However, a ‘bomb of debt’ has been ticking for too long. Something had to be done long time ago. Now it is too late. I think the best candidate for shorting is the greenback. Therefore, if you are interested I would recommend watching eur/usd, gbp/usd, aud/usd price action around European sessions and try to see whether there are any reversal around support area. If there are you would have an opportunity to short the greenback and have a day trade.

See you tomorrow. 

Moving average

MACD

Disclaimer

Trading financial markets carries a high level of risk, and may not be suitable for all investors. All information on the blog is of educational nature and cannot be considered as advice, recommendation or signals to trade in any financial markets.