Weekend Update

EURUSD - as expected 1.1450 held & pushed this trade 170pips in my favour by end Friday.
On weekly charts (see inset), price is getting squeezed between 21 & 50SMAs, so either bulls or bears will give in very soon. I am bearish because: a) there is a potential weekly double top continuation pattern (the "M" pattern) and b) the week ended with engulfing bearish candle or rail road tracks candlestick pattern. So, I am waiting for the ST trendline break on a daily chart to short more but also aware that there are 3 important support levels in this 1.12-1.10 congested range and it is important to see a follow thru when the uptrendline breaks. I also do not want to see this pair back above 1.1460 because then 1.16 maybe the next upside target.

GBPUSD - last week I said above 1.55 will test the bottom of the uptrendline at 1.56. I was on the sidelines and did not short this pair. It needs to get below 1.55 and more importantly below 1.5450. Only then will I have confidence about its potential decline. Till then, there is nothing to do here.

  AUDUSD - the weekly inside bar worked and this pair went higher. What now? There are reasons for both bull and bear cases. I am bearish bc so far there are more reasons to be bearish
Bull: broke thru 3 month downtrendline but now it has to hold above it. Previous breaks led to retests of the broken downtrendline and to pauses in this downtrend. Daily close above 0.7264 will lead to 0.7340/70 resistance range.
Bear: a) tweezer top, b) previously only when price closed above daily 50SMA did it lead to a pause in the downtrend and with both SMAs firmly pointing downwards, it is not looking good for bulls, c) in this year long downtrend, whenever RSI fell back below 50, the downtrend had resumed and such a close below 50 looks very imminent to me.  In terms of price levels only when this pair closes below 0.7100 at least in H4 TF will I know that the downtrend will have resumed.

USDCAD - it bounced off 50SMA and is in back in the range.So nothing to do here

USDJPY - I will try shorts at 121 and 121.50/70 resistance area. Below 118.34 should target prior low at 116.15

Good Luck

Weekend Update

EURUSD - last week was another reminder for me of having Plan B at all times. Then I won't get caught with my pants down. My such alternative scenario was weekly 21SMA pushing the price back to 50SMA and when it happened I was not surprised.

On Monday the Euro retested 1.1206 resistance where I went short. The next day it initially went down (naturally I thought!!!) but then came back up to close flat. Now, that got me worried a bit.The next day my SL @1.1244 - the high of the tall red bar from 2nd September - got hit (also see H4 time frame for clearer pic). Tall bars are relatively reliable as short term trend change indicators. So when last Thursday the Euro closed above the high of the tall red bar and back above 200SMA that a test of the nearest swing high @1.1337 and/or the bottom of the uptrendline was imminent, imo.

Having lost money on the short, I did not make money on the long side either because I did not get the right setup. In hindsight, as is always, I should have been bolder.

What is next for this pair? See the chart for commentary.

GBPUSD bounced perfectly from 1.5167 support to my target of 1.5331, a resistance. I got lucky by not shorting as it was 55 pips away from 1.5331 at the close of the day, and I did not expect it to get to my target at 6am in the morning and did not have my sell limit order in place.

Anyhow, the impulsive way it moved cutting thru resistance and H4 (TF) 21/50SMA was enough indication that 1.54/1.5440 was the next target area. My buy limit @1.5335 was missed by 3 pips :(. Close but no champagne!

AUDUSD - not much to add. It also bounced off oversold levels and is testing 0.71/0.7120 resistance area. Daily 21SMA is also right above. But we have got a very good looking weekly inside bar. Previous inside bars failed but also those that did not led this pair higher. So either 0.7163 (the high of the last down bar) holds or it will climb up to 0.7215/52.

USDCAD has been a pain in the ar.e, to be honest with you but it finally seems ready for a breakout. Daily chart is showing a tightening triangle. In this case I would expect a continuation up move but just in case ready to short on a break lower.

USDJPY - see the pic

Good luck.

P.S. I wanted to share a good strategy of mine that works best in H4 time frame.

Weekend Update

EURUSD rallied the min 100pips I expected reaching 1.1332 as both rising 21SMA & ST uptrendline held but falling 200SMA pushed this pair down from Wednesday onward. My base case that I highlighted over the last couple updates, is that it is going to 1.05 at the very least. Once it closes below 1.08, I believe it will be a fast trip to 1.05 as all those who bought at this level will have to quickly unwind their positions. Shorts burned as it went above 1.1450 and below 1.08 longs will get burned. Shake 'em all before moving in it is intended direction. 

On fundamental front, Draghi wants the Euro down while US economy seems stronger as the Fed talking up a rate rise, which is USD bullish. However, i do wonder what will the Euro do if equity markets tank again.

From technical standpoint, the pair is now below 1.12 and 1.10 and 1.089 are the next stops. As simple as that. I will short if it makes a new low on Monday or  bounces back to 1.12. 

One pattern I like to trade is the squeeze between two SMAs. One such squeeze happened between 21/200SMAs last week, another is in the process between 21/50 on a weekly chart. So there is a possibility that a weekly 21SMA pushes the price back to 50SMA. There price gets rejected again and goes to my 1.05 target or lower or it hangs around it for some time and the trend changes as a result. Why? Because I noticed a noteworthy pattern regarding a intermediate/ major trend change in EURUSD on weekly charts. The trend seems to reverse when price is stuck between these two SMAs over at least 6 weeks. In the last 2 cases (Sep-Oct 2012 and Jun-Jul 2014), the pair was hugging 50SMA before turning for good.

GBPUSD did not bounce to my sell level but at least performed as expected after breaking 1.5331 support. So far it fell 9 days in a row and is currently sitting @1.5170 support. It either bounces right here or off 1.5120/00 range. Obvious short level is 1.5330 resistance. My bias is to buy at these support levels to profit from bounces BUT I am not bullish this pair especially below 1.50. On weekly charts, 2 large engulfing bearish candles already made a new swing low. Therefore, longs beware.

AUDUSD is a sick pair. It reached my 0.70 level and went further below. In the mean time no sign of weekly RSI divergence extering its influence. The next monthly target is 0.6760/85 level. A bounce back to 0.70 or 0.71 (shaded area) is a sell.

USDCAD is another weak commodity currency. It could not even rally in tandem with Oil and gave more ground instead. The short term uptrendline that it broke midweek gave no follow thru and price stalled at intraday support. I got suspicious and bailed out and so far I am happy I did. I am long @1.3238 targeting prior or hew highs but I will be watching the intraday support at 1.3116 in case it decides to finally dive back to 1.30. I do wonder however if I should be buying 1.3116 support instead of shorting its break.

USDJPY reversed from the underside of the broken uptrendline. The break of 120.64 support and then a retest of then 120.64 resistance gave  excellent shorting opportunities. Now it is in 119/118.50 support range. I will short more at 118.32 or 120.24/64 range above. If it gets back above 120.64, then 121.50 is likely the next target.

Good luck