9th Feb 2009 EUR, AUD, GBP Daily part 2

AUD Weekly and spiral filter

As per morning reports:- higher opens and expectation of a pullback.

AUD pushed upwards on Friday shifting the Weekly 50% level to .6755

Higher Weekly open and looking for a move back down into the February 50% level @ 6565 Random support.

At this stage I’m not convinced that the Monthly 50% level is a robust support
zone that’s going to send the AUD higher. Therefore I would need to verify
support by exiting shorts, and only then trade longs from a lower daily open
rising upwards from support levels.

Partial exit + 85

9th Feb 2009 EUR, AUD, GBP/USD Daily

AUD Weekly and 3-day pattern

AUD cross over the Monthly 50% level but not from a double bottom in the monthly timeframe.

It’s unclear if the AUD will continue upwards, therefore the Weekly 50% level is the trend guide and the Weekly highs are resistance.

Any UP move should come back down into the monthly 50% level this week, and then use this levels as support.

Monday:- there is a breakout of Monday’s highs, therefore I would look for a move back down to retest the break or the 5-day 50% level.

Trade on the side of the blue filter, which matches the Weekly 50% level.



Euro Weekly and 3-day pattern

Weekly 50% level is the trend guide this week.

It’s also a higher Weekly open which can easily push the Euro lower this week.

The Euro can also continue higher, and move towards the Weekly highs, but that would be confirmed with a HOOK over the Weekly 50% level, and that’s not the case atm.

Weekly 50% level and Monday’s highs resistance.

Trade on the side of the blue filter….

No probability on Monday’s trading as things aren’t unclear at this stage.

GBP Weekly and 3-day pattern

GBP back into the February 50% level :- Weekly highs resistance.

There is no Weekly close above the February 50% level.

Therefore we have a higher Weekly open with price trading around resistance levels, and if GBP is heading back down we need to see a number of patterns unfold….

Trade on the side of the blue filter:- below and expectation of a pullback into the 5-day 50% level is the first stage of any reversal.


BASED ON TODAY'S OPEN ALONG WITH THE LEVELS IN THE MARKET, THERE AREN'T ANY PROBABILITY TRADES FOR LONG POSITIONS IN ANY OF THE THREE CURRENCIES.

7th FEB 09 AUD, EUR, GBP/USD Weekly

AUD Monthly and Weekly

Expectation that the AUD was going to down into February's low hasn't played out, with the Weekly close above the Monthly 50% level.

If the double Monthly low pattern had played out into February's low then I would begin to look for a move up towards the Quarterly 50% level.

At this stage I'm going to treat AUD based on the Weekly highs next week:- resistance

And for any higher move occur, I would use the Monthly 50% level as support.

Therefore next week our view is for price to come back down into the Monthly 50% level from resistance, until proven wrong



AUD 3-day pattern

Last week there were 3 high probability patterns based on the higher timeframe trend and text-book patterns

Tuesday's up move with the break of the 3-day filter and heading higher:- exit on higher daily close

Wednesday's reversal down from the 3-day filter.

This pattern is your holding set-up:- Monthly and Weekly trend down and reversing from the 3-day high filter. Even though price didn't continue down this week, that was a 'holding' set-up with the expectation of lower prices.

Thursday's:- Day trading set-up.

A bounce off the 5-day 50% level, but only confirmed with a move back above the 3-day filter @ 64.61 heading back towards Thursday's highs

Friday's rally , wasn't a trading set-up, simply because of higher timeframe dynamics.

There weren' t any Daily HOOK patterns over the higher timeframe 50% levels, unlike GBP.

In fact is was short set-up because of the higher timeframe set-up, which mirrored Wednesday's reversal down.

But we would have known that the trade was failing simply because price was above the 3-day filter. Euro Monthly and Weekly

Expectation that the Euro is heading down into February's lows, and at this stage there isn't anything to disapprove this won't happen.

Next Week:- Weekly 50% level the trend.

If trading above, then the expectation is price is heading towards the Weekly highs.

Euro 3-day pattern

I would say only 2 higher probability trading set-ups last week.

Tuesday's 3-day filter breakout and rally into the close.

Wednesday's reversal down from the Weekly 50% level, but the trade could only be confirmed with the break of the 5-day 50% level.

The rest of the week was to manage the trend based on the 5-day 50% level.

Friday's UP move wasn't part of any set-up.

GBP Monthly and Weekly

Expectation of lower prices in February.

This week saw a Weekly Hook pattern on Tuesday and continuation higher into Friday.

It was the only currency that had a 'holding' BUY set-up.

AUD had a BUY set-up on Tuesday and Thursday, whereas the Euro only had 1:- Tuesday.

Next Week:- Weekly highs resistance with an expectation of a push back down, into the February lows.

Price could also reverse back down from the monthly 50% level, but i'll have a look in the daily report on Monday for any set-ups.

It obvious that a break above the Weekly highs and above the Monthly 50% level the potential to move back towards the Quarterly 50% level is a high possibility. But I would only make that conclusion after a double bottom , not based on this current price action.

GBP 3-day pattern

Monday probability started with a thrust pattern down from the Weekly 50% level.

Traders didn't have to wait until the 5-day 50% level, because price was also coming down from the 3-day filter.

Tuesday:- Even though both the AUD and Euro had BUY set-ups (3-day filter breaks), GBP didn't. The trend or trade had to be manage by the 5-day 50% level.

All the rest of the set-ups were mainly BUYs, simply because of Tuesday's HOOK pattern over the Weekly 50% level up into a higher Friday close.

6th Feb 2009 EUR, AUD, GBP/USD Daily

AUD Weekly 3-day pattern

Yesterday's view was that:- trend is down and expectation AUD is going lower, but a bounce off the 5-day 50% level had to potential to move towards Thursday's highs & the February 50% level.

Friday's 3-day filter is simply the trend guide...

Below and it's part of the February 50% level rejection and heading lower next week.

Whilst above it's part of a higher Friday close. but I would like to think shorting below the 3-day filter is the go.....

Euro Weekly and 3-day pattern

Yesterday my view was the 5-day 50% level was going to cap the market, and today I can't see any upside in the Euro.

Personally I wouldn't go looking for long trades:- levels shown are resistance.

5-day 50% level and 3-day filters

GBP Weekly and 3-day pattern

Weekly HOOK patterns playing out, with the potential of a higher friday close.

But the 3-day filter and Daily highs on Friday along with the February 50% level, so these levels are ideal SHORTING zones because of the view of currencies moving back down into February's lows.

5th Feb 2009 EUR, AUD, GBP/USD Daily

AUD weekly and 3-day pattern

AUD bearish with the expectation of lower prices.

Thursday’s 5-day 50% level is the trend guide….6405.

If it’s above 6461 it could move back towards Thursday’s highs, looking for a retest of the December 50% level.

Below the 5-day 50% level and it’s down towards Thursday’s lows.




Euro Weekly and 3-day pattern.

At this stage there is no other conclusion I could make other than price continuing down from the 5-day 50% level towards Thursday’s lows.

Above 1.2875 %-day 50% level and price is back towards 1.2942.

An UP day isn’t part of today’s probability pattern, but don’t fight the trend.




GBP Weekly and 3-day pattern

GBP Weekly HOOK bar over the Weekly 50% level has played it’s probability pattern of rising upwards from the 5-day 50% level on Wednesday.

I’m still bearish on GBP, but price could continue up towards February’s 50% level by Friday.

Trend guide 1.4456 could push prices higher towards Thursday’s 3-day filter.

Bearish pattern will only be confirmed if price is trading below the 5-day 50% level on Thursday.

4th Feb 2009 EUR, AUD, GBP/USD part 3

Euro 22:15

Euro has reversed down from the Weekly 50% level confirmed with a break of the 5-day 50% level :- random support.

As per view of lower prices heading down towards the February's lows.

However for me the ideal pattern was the break of the 5-day 50% level, but also
the R41 rejection pattern using the filter, which matched the price action within this 4 hour period.

Partial exit pink to pink... + 88 pips

holding with breakeven stops from entry...

For someone else as an example, they could run stops above the 7pm highs.

Exit Wednesday's lows

4th Feb 2009 EUR, AUD, GBP/USD part 2

AUD 18:30

AUD has reversed down from the 3-day filter, and if it follows the view of lower prices hopefully it can break Wednesday's lows and continue down...

Partial exit @ the pink filter @ .6415 + 102

And hold.

As long as price remains below the 5-day 50% level then either AUD can break Wednesday's lows, or find support and then follow another down move on Thursday.

The reason for these updates today were just to highlight that even though we all like to use certain intraday filters or other methods such as mechanical systems, we must all still try and understand price action.

We must learn to read price activity around levels of support & resistance. We must be able to perceive when a trend is healthy and when it's not. Trading is not a science and CANNOT be hard-coded for sustain profitability.

We must understand that we ought to become an actual trader and 'CHART' reader using principles (text book patterns), as opposed to just an indicator follower.

There are some that can grasp certain ideas far quicker and easier than others, but hopefully over time those things become second nature to you.

4th Feb 2009 EUR, AUD, GBP/USD Daily

Expectation the Currencies are moving down into February’s lows, as long as they remain below the Monthly 50% level.

On the way down the best ‘short’ trades if you want to trade random entries with much wider stops than what day-traders use, then you trade the Weekly 50% levels on the way down.

The best trades always occur from higher Weekly opens or higher Daily opens as the trend continues down, and as prices are moving down from resistance along with higher Daily opens, not rising upwards from lower opens, as was the case on Tuesday.

Euro Weekly and 3-day pattern

Therefore on the Euro on Wednesday we have the Weekly 50% level and a higher Daily open on Wednesday, which normally would provide the ideal set-up to trade down…….

And as per yesterday’s Daily report….Above the 3-day filter and expectation that price 'could' move into a breakout on the upside during US timezone, as it rotates back towards the higher timeframes.

In the Forex section of the book, there is a very similar chart :- figure 82.

Whilst above 1.2834 and the 3-day filter on Tuesday (Yellow) you are anticipating the breakout of the 5-day 50% level, which normally breaks during the US timezone, also confirmed with the 3-day high breakout.

Let’s subscribe to Text book patterns again….

The Weekly 50% level and a higher close, but it's trading above the 5-day 50% level.

There is a breakout of the 3-day range and above the 5-day 50% level, therefore there is an expectation that the Euro could move higher.

Therefore you can short the Weekly 50% level from a higher Daily open, but unless it's back below the random support shown in the 3-day chart:- 5-day 50% level, the Euro can easily continue higher.

Your best trade is going to be shorting around the 5-day highs around 1.3202 and or the 3-day filter if you want to position trade the Euro.

If that trade works and begins to move down, it might take a number of days to begin to move lower, as it's above the 50% levels of the Weekly and 5-day 50% level:- figure 82 in the book.

But also keep in mind that a Weekly 50% level HOOK pattern could result in a higher Friday close.

So that a Short around 1.3202 or lower might only be valid for 1 day, but we won't know that until proven wrong.

Then this gets back to 'short' trading a higher weekly open from next week.

AUD Weekly and 3-day pattern

Same breakout pattern in the 3-day chart on the AUD, but the important part is the February 50% level.

I subscribe to lower prices in February, therefore Wednesday’s 3-day filter is my trend and shorting guide…

I’ll know right away whether I’m wrong or not, as price can follow Tuesday's range higher towards the February 50% level, which probably makes much more sense if it is rising upwards from the 5-day 50% level.

GBP Weekly and 3-day pattern

GBP could continue higher.....

And if it follows the Weekly 50% level Hook pattern, price could make it’s way back towards the February 50% level and as high as the Weekly highs:- Higher Friday close.

But the 3-day filter is the trend guide, and any weakness can begin from this level, but won’t be confirmed until price is back below the 5-day 50% level.

In conclusion:- The monthly 50% level is the trend guide, and the Weekly 50% levels are the trend guides.

The Trend is down, therefore the most robust shorts occur from either the higher tiemframe 50% levels or Higher opens as short-term timeframe 50% levels break:- 5-day 50% level.

At this stage I would like to think that prices are going to reverse down on Wednesday from a higher Daily open and also the Weekly 50% levels, but I know that the 3-day breakout from Tuesday can send prices higher from Wednesday's 50% 5-day 50% level.

3rd Feb 2009 AUD, EUR, GBP/USD Daily

AUD Weekly and 3-day pattern

As per Weekly report:- expectation of lower prices in February.

As per Weekly report:- each 3-day filter is a resistance for shorting.

As per Text book patterns:- Weekly lows can support the market resulting in a swing back towards the timeframe 50% levels.

In this case the 3-day filter is a resistance level but much less so because of the positioning within the higher timeframes.

Therefore above the 3-day filter price is heading back towards the 5-day 50% level, which could result in a breakout of the 3-day channel high (blue) and a higher daily close during US trading timezone.



Euro Weekly and 3-day pattern.

Read the AUD report and apply to the Euro trading for Tuesday



GBP Weekly and 3-day pattern.

Different market dynamics....

5-day 50% level Resistance with an expectation of a push down into Tuesday's lows.

No probability on a higher daily close:- 3-day filter random resistance.

2nd Feb 2009 AUD, EUR, GBP/USD Daily

AUD Weekly and Daily

The view is for currencies to move lower in February, but it's hard to short a lower Weekly open.

There is no probability on shorts unless there is a 2-day up swing into the higher timeframe 50% levels.

For day traders simply trade the levels in the 3-day chart.

3-day filter random resistance



EURO Weekly and 3-day pattern

Same expectation on the Euro:- lower prices this month, but it's hard to short unless it moves upwards.

3-day filter random resistance.

GBP Weekly and 3-day pattern

Ideally I would like to see GBP move up early this week and then reverse back down.

The Weekly 50% levels are your trend guides...

Note:- random support 5-day 50% level and Weekly balance point.

3-day filter random resistance