Nothing new and John Coates book Hour between Dog and Wolf is suggested in our Forex Trading Program. And clearly scientists haven't factored in how market makers manipulate which leads to this 'reckless behaviour'!
As I've written in the past gbp/jpy never fails to deliver and this week it's been a real rollercoaster, but Yeppy saved the best for today with a little help from Washington, as markets reacted to the Bannon saga. Could say the administration now resembles a cross between GOT and House of Cards!
From a technical perspective my focus today has been on the 30 min chart and the extent to which this chart illustrated the power of stopping volume and how we can see an intraday buying climax.
As we can see from the chart the pair had been drifting lower from the VPOC at 141.63, but it was the fall from 140.60 and the subsequent price waterfall where we had falling prices on ever increasing volume took gbp/jpy down to 139.77. The resulting doji like candle on high volume accompanied by a pivot was the signal of strong price support and a likely reversal as buyers stepped in.
139.77 is also significant as it was a few pips away from the VPOC on the daily chart - so price time and volume also coming into play.
So unless there is further dramatic news from the White House gbp/jpy is looking to end the day on a more positive note as equities too pare back their losses.
Yesterday's post on GBP/JPY highlighted the minor support platform at 141.50 which has been taken out in today's trading session as the pair continue to look very bearish with the potential to test 140.
Today's price action also validates the anomalies we had on Monday and Tuesday where high volume was associated with up candles with deep wicks to the upside, suggesting weakness to come. That weakness started yesterday. and continued today as equity markets hit with yet more White House rumour and speculation.
While traders were digesting the ECB minutes some political news from the US resulted in sharp move higher for JPY. The news (which is still unconfirmed at time of writing) is that Gary Cohn has resigned as President's Chief economic advisor on the Economic Council. This is market moving news because Cohn has been tipped as a possible replacement for Janet Yellen.
Until this rumour, and from a technical perspective, the JPY yen had been broadly moving sideways on the faster timeframes after some volatility on the release of the ECB minutes. Indeed a most of the currencies were bunching in the centre of the 30 min currency strength indicator, which is a classic sign of a market simply meandering along. Then the news hit the wires & volatility ensued.
And since the initial spike higher JPY index has retraced, but it's still volatile and likely to be so until we have some clarify on the Cohn story.
So as they used to say in Hill Street Blues @Let's be careful out there' ... See MoreSee Less
Simon Therrien MigneaultNikkei 225 finished down for the day ... and oil was going down from london Open ... insiders Cost price for Pound/yen 142.00 ... I went short before news at 141.93 after that 142.00 rejection. HIGH rise of bearish volume candle on 1 min candle I was short.. best cost price possible .. I was soo happy it went down instantly.. I had 20-23 pips and was loosing volume... before that retail sales Us news... volume drop before news is not good ... I closed + 9 instead of + 22 where I could have got out being more logic about what is Happening NOW .... so anyways I went short again pound/yen from 141.99 on the second doji where you see rise in volume of 5 min chart.. then I made +25.... but man I had the flow of money of the bigger picture direction I closed too soon ... im grateful for what went right but not satisfied with that poor decision 25 min later my 141.50 Take profit would have been hit ....it is my first day trading Using relational fundamental stuff and it's amazing 🙂 il get better everyday in everyway ... I refuse to be anything less than a Market Wizard 😀 have a good night
A typical forex trading day for David & I. Our Complete Forex Program is now live and within the program you will find a module dedicated to technical analysis and VPA which can be purchased independently (as can all the modules). The module also includes a comprehensive workbook of over 200 worked VPA examples across all markets and time frames.
Those of you who come along to our webinars will have heard David & I stress how important it is for index and stock traders to keep an eye on the currency markets. Not not just the USD, but also the Japanese Yen whose performance will often signal a change of both short and longer term sentiment.
The pair we always watch is the USD/JPY, but there is another pair that correlates well with stock markets and that is the Aussie Yen, as the Aussie is considered a risk currency by virtue of Australia's status as a major commodity exporter, particularly to China.
Furthermore, there is no a Yen index we can follow to make life a little easier. This has been developed jointly by the Dow Jones and FXCM, and we also have one available from our Quantumtrading stable of indicators.
The session thus far has seen the AUDJPY in free fall with the pair now approaching a low volume node on the daily chart which will add additional momentum should the pair breach the key 83 level. Indeed the 4th Camarilla support pivot also sits at 82.90 renforcing the importance of this level.
All now hinges on the US session and whether traders decide to reverse the currency bearish Globex tone. ... See MoreSee Less
A typical working day for David & I recorded as part of our Forex Trading Program. Do check out the modules which are applicable across all markets. And for those of you who used to come to our open access webinars you will be able to see Bertie & Harry!
Goes without saying markets are USD centric and with the DXY having moved sharply lower over the past 4 months commodities such as oil and gold should, under normal circumstances, haven been on a tear. But this has not been the case , and whilst there have been gains for both gold and oil, silver has only this month displayed any serious bullish momentum.
And there are several reasons for this which I've outlined in a post on the forex page. The technical picture for the USD does not in fact reflect the fundamentals for the currency where rising interest rates and a widening in comparable bond yields would normally result in a strong currency. Market commentators have therefore looked to the political landscape and in particular to Donald Trump and his failure, thus far, to push through any of his campaign agenda.
Political influence as well as the effect of Donald's twitter feed on the markets is something we now have to factor into our trading analysis, and is likely to continue for the foreseeable future. However, given we are only 7 months into the Trump presidency not sure how we are going to cope for the remaining years of Donald's tenure.
Moving to the charts & gold and here the key upside level is the $1300 per ounce price point which was tested back in April but did not follow even as the USD fell sharply. A further attempt in June resulted in the precious metal hitting a high of $1298, before falling back to $1204 in the first weeks of July but has since has provided the support platform for gold's current move higher. But $1300 remains the upside target and any successful breach would see gold attack the August 2016 high of $1374. ... See MoreSee Less
Clear from the daily currency strength indicator that we should expect a USD bounce this week, which has duly occured. This has not mitigated longer term bearish tone for the USD but move higher should be sufficient to garner a few pips across the majors.
What's also interesting on the daily CSI is oversold nature of the JPY, particularly against the CAD which has, of course, reflected the recent bounce higher in oil. ... See MoreSee Less
You can use the currency heatmap in lots of different ways. Not only does it give us a global overview of all our 28 currency pairs, but it's brilliant for tracking flows into an individual currency, and whether those flows are consistent across the pairs. NZD is a case in point with NZDUSD at the top and GBPNZD at the bottom, and once a pair is at such an extreme we know it is only a matter of time before we get a correction.
How we trade that correction will depend on the structure of the chart, and our preferred tactics. ... See MoreSee Less
Price action on Yen pairs using renko highlights the buying momentum for the currency. CSI shows extent to which Yen is overbought on faster time frames, and likely to offer a trading opportunity. However, on 4hr CSI the Yen is still climbing strongly suggesting move lower may simply be a pullback, and question is, as always, is it worth trying to trade any such correction? And the answer depends on the pair and whether the range is sufficient; your time horizon and your trading approach.
As David & I always say in our webinars, there are many different ways to make money from the markets, and no general consensus as to which is best or most profitable. But there are only two ways to lose money: The first is not managing or controlling your losses and second, too much leverage. ... See MoreSee Less