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After the first $110 billion aid package failed miserably to alleviate market fears, instead sending them into a tailspin last week because it was literally too little too late, the even larger $720 billion EU/IMF rescue package appears to have fallen flat on the markets this week, although it has appeared to calm markets considerably from last week, reflected by the Greek 5 year credit default swap of 484 bps from 510.5 bps at New York close Tuesday and the lack of any further extension of the major downtrend. Also lending to the recent rally attempts was demand for euro’s as a result of Germany’s 2-year 7 bln euros auction and
Continue reading–>EUR/USD Continues to Waiver
After following this pair downward for a while in a fairly easy to read step type pattern, the price has reversed. It is perfectly reasonable to presume that a short trade would have been stopped out at this point, but if our money management rules were in place and our discipline has held we would only be looking at a breakeven outcome.
This is an acceptable result, and we then observe before committing ourselves to another open position. In the hours that follow we can watch how the price reacts to this changing sentiment of traders, noting where are the swing highs and the swing lows to inform us of market condition.
Continue reading–>FOREX DAWN| EUR/GBP Changes
Who says markets don’t give you a second chance?
A decidedly different tone in the markets today, as the EUR/USD is trading appreciably firmer after global authorities met over the weekend to try and stem Greece-induced contagion. Obviously the first package which was rushed through in order to calm market fears was too little too late. Now global authorities have come up with a 720 bln euros (approx $1.0 trln) financial assistance package designed to stop Greece-induced contagion from spreading (sounds like the plague or something). The 720 bln is broken down as follows; government-backed loan guarantees and bilateral loans worth up to 440 bln provided by eurozone members, 60 bln
Continue reading–>EUR/USD Finds New Strength
EUR/USD sunk as low as 1.2691 from 1.2850′s after a flat Asian session lead into a volatile European one . One big change is that the bulls have at least began to put up a fight again, although one could also argue that the recent rallies stem from short covering and profit taking just as well. European traders started the morning with another large sell-off, with hedge funds, Russia and surprisingly the BIS notable sellers just above the low 1.2800′s. The session low seemed to have found a bottom at 1.2730 from where we bounced smartly amid reports of a “well respected” fund buying decent amounts. Not to be
Continue reading–>EUR/USD Wrap Up: Risk Aversion Remains Strong
You got to love weeks like this one! Here’s a brief explanation of how I traded the EUR/USD so far this week.
This is a good example of what I look for in the market, a pair that’s trending with consolidation periods that are around the 20-30pip mark. Two fairly obvious points where price breaks and allows us an entry location into the market place. Around 60-70% of these breakouts follow in the same direction as the prevailing hourly trend.
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USD/CHF Pushes Higher
Here is a nice set-up after an impulse move up gave way to this consolidation zone on the Swissie. High probability that the price was just pausing before pushing higher, so we can plan ahead and catch the next wave. As I am writing this my target has just been hit, I have got the 30pip SL back from the 1st lot, and am now out of this trade for 80pips. Looks like this too wants to go higher, the USD finding some strength against most currencies.
Update: Target Hit!!!
USD/JPY Breaks Resistance
A fairly rapid 50pip target reached off of this break of resistance, and a fairly high probability that
Continue reading–>FOREX DAWN| USD/CHF & USD/JPY Trade Setups
Serious selling pressure mounts against the euro as a rumor that Spain will ask for 280 billion euros of aid money in order to deal with its debt has sent the pair plummeting. The fact that that nation also has a 20% unemployment rate doesn’t lend investors any confidence either. Spain’s Prime Minister Zapatero made a statement addressing today’s rumors saying: Rumors can damage Spain’s interests and that is intolerable. The rumor is complete madness, he says.
Zapatero’s comments fell flat on the markets as the EUR/USD started the European session around 1.3200 and it was full on sell-off from there as the pair continues to make new yearly lows every hour. Combine
Continue reading–>Risk Aversion Soars
It’s one of the first questions you ask yourself whenever you first learn about this market and the reasons are extensive. Here are the top 10 reasons to trade forex.
1. Take control of your own finances. No one wants to be a wage slave and trading forex is another way to supplement your income. The returns offered on most mutual funds, hedge funds, or managed funds is laughable usually around 5% annually. Unless you have millions to invest, that 5% doesn’t mean much until many years into the future. Most successful forex traders earn between 10% – 30% of their overall capitol each year.
2. You can make money working only a few hours a day or week on your
Continue reading–>Why Trade Forex
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