Trading Week 11/02/13

Saturday 16th (6 am)
Another choppy session. The USDX is chopping under the 80.70 level and the EURX is chopping around the 108.5:

E/U: price has chopped around the weekly 200 EMA

Yen pairs: This is why I won’t short Yen pairs at the moment…sudden weakness sent the crosses up:
E/J 

A/J

U/J

The Aussie tumbled:

The Cable has flattened out:

 The E/A turned too

The EUR/GBP continues to chop around as well

The Kiwi seems to be re-testing the triangle trend line that it broke out from:
Kiwi 4hr

Kiwi daily

This choppy and flat action has been noted with stocks as well. This comment was from CNBC and seems applicable to all markets, not just stocks:

“We’ve been stalled for a week and a half—we’ve been churning, unable to pierce the upper level at 1,525 [on the S&P 500],” said Kenny Polcari, director of floor operations at O’Neill Securities. “But I’m not necessarily surprised as the market needs to consolidate and catch up with itself.”

Friday 15th (9 pm)

It’s choppy with info being leaked…The USDX is rallying:

The EURX failed, so far, to break back above the 108.5 level: 
E/U

E/J

A/U

 A/J

G/U

U/J

Kiwi

EUR/GBP: new triangle pattern

Friday 15th (5.40 pm)

Euro shooting up on comments that ECB won’t cut interest rates to weaken Euro:
I really think, apart from the current divergence, it would be wise to wait to trade until next week and after the G20 fallout.

Friday 15th (5 pm)

Not much action ahead of the G20.

Friday 15th (4.15 pm)

I’m just home and see that not much has changed except there seems to be some Yen strength.
The E/U is still holding above the weekly 200 EMA:

The Kiwi is still hovering around the S/R level of 0.85

The E/J signal is still going and a support trend line is being tested:

The A/J gave a signal on my 1pm candle and a support trend line is being tested here too:

So, too, did the U/J.

I’m not shorting Yen pairs and I’m wary with the G 20 looming. I’m waiting until next week now.

Friday 15th (9.30 am)

The EUR/AUD continues to slide after it broke down from the triangle formation. Like with the Kiwi, this pair didn’t produce a clean TS signal along with the breakout. I find this happens a bit when there is Cloud divergence!

Friday 15th (9.05 am)

Price on the E/U closed above the weekly 200 EMA on the daily chart. I’m not keen to SHORT this pair now, especially so late in the week and with G20 looming. Price is almost back to where it opened for the week which kind of sums things up. Choppy! But, then, I expected this given the Ichimoku Cloud! I’ll still keep an eye on it with respect to the weekly 200 EMA though:

Kiwi: This has now had a close above the major S/R 0.85 level on the daily chart and looks quite bullish. This did not produce a clean TS signal though and would be more of a strategic play:

A/J: This signal finally closed out overnight too:

Friday 15th (6.45 am)

Price action continues to be choppy but more skewed towards ‘risk off’ now. The USDX looks to be rather bullish and the EURX is trying to get back above the 108.5 level but hasn’t managed to just yet:

The Kiwi has stalled under the 0.85 S/R level

The E/G continues to chop around under the major monthly channel trend line

E/U: This is the one that interests me most at the moment. I have had a TS signal and will be keen to SHORTif it holds below the weekly 200 EMA for the daily candle close.

The E/J signal came through on my 1am candle but I’m still reluctant to short any Yen pairs. A support trend line is looming though and, I have to admit, a break, close and hold below this level would be tempting.
I am wary ahead of the w/e G20 meetings though and, also, the fact that we still have Cloud divergence.

Thursday 14th (9.05 pm) 

The Kiwi has not closed above the 0.85 level.

I’ve had a sell TS signal on the E/U. I would want to see it close and hold below the weekly 200 EMA though first. 

And on the E/J. Correction: I’d need the next candle to confirm this signal. That is, the 1am candle.

Thursday 14th (8.30 pm) 

The Kiwi has punched above the 0.85 level! See post from earlier today. I’ll be looking to see if it holds above this level for a possible LONG:

Thursday 14th (7.15 pm) 

BTW: My LONG A/J signal from earlier in the week never really closed off. It is actually still limping along and in some profit. I didn’t take any of the Yen signals though.

In fact, the A/J is looking a little ‘bull flag’ like on the daily, especially as it sits under the key S/R level of 97: 

Thursday 14th (6.50 pm) 

The Euro is under some pressure again. the USDX has shot up again:

The EUR/AUD has had a triangle break and is trying to form a TS SHORT signal. I’ll check it at the 9 pm candle close BUT I’m wary with any 4hr signal given the divergence we still have: 
The E/U might form a signal then too but, like before, I’d want to see it close below the weekly 200 EMA first:
The A/U signal is still above entry but might not be for long. I’d have any stop to entry ASAP:
Divergence = choppy 4hr trading

Thursday 14th (5.30 pm) 

No new signals after the 5pm candle but I wasn’t expecting any. I’m still keeping an eye on the Kiwi, EUR/AUD and EUR/GBP as per earlier posts.

Thursday 14th (2.30 pm) 

Watching and waiting!

Thursday 14th (11.50 am) Kiwi

This is making a bullish move on the back of some good data from earlier today: I’ve had this pair trading in a triangle for months now and this might be the break that takes it onward and upward. I’m wary of a possible ‘double top’ at the 0.85 level on the daily chart just now though so would want to see it clear this first. This 0.85 level has been strong S/R over recent months as can be seen from the weekly chart. I’m thinking a close and hold above this strong S/R level of 0.85 might be something to work from later on:

Thursday 14th (11.30 am) EUR/AUD

EUR/AUD: Still triangle bound but no signal:

Thursday 14th (8.30 am)  EUR/GBP

There is very little happening so I thought I’d check out a few different pairs. Another trader brought up a trade he had on the EUR/GBP last night so I thought I’d look this pair over. I used to watch this pair but dropped it ages ago as it barely moves. It is at an interesting level now though as it nears a channel breakout and might be worth a look at:
E/G monthly : price is trading up near the upper trend line of a major month trend channel:


E/G weekly: The volatility as price nears this breakout level is quite obvious:


E/G daily: price is chopping around under a potential breakout level

E/G 4hr : price has had a bullish triangle breakout and is about 150 pips under the monthly trend line. I don’t have a TS signal to LONG though. Price might chop around more and maybe grind higher. I will keep an eye on this pair now for any new TS signal and a potential monthly trend channel breakout:

Thursday 14th (6 am)

The choppiness has continued overnight with out even any good trades off the 30 min charts. The indices have simply chopped sideways:

This tells us why:

The A/U signal, the only one in play still, is currently up ever so slightly:

No trends…no trades…it’s pretty easy to see.  Keep your powder dry!

Wednesday 13th (9 pm)

The choppy markets continue. No new signals just yet. The only open signal is the A/U. It is flat at the moment.

Wednesday 13th (5.05 pm)

There is still Cloud divergence so I’m in no hurry to trade. The A/U has given a weak signal but I won’t be taking it. This pair is still also trading below its own daily and 4hr Cloud so biased more towards short for now.

Wednesday 13th (1 pm)

The EUR/AUD signal has reversed on the latest Aussie strength:

The A/U has almost given a TS signal BUT, like it has over recent weeks, the signal has taken too long to form and may not be valid:

President Obama is speaking whilst I type. This may start some movement.
There is still Ichimoku divergence so I’m in no hurry to trade. The TS signals have been chopped around this week with this divergence.

Wednesday 13th (8.00 am)

It is pretty quiet and it seems that everyone is waiting to trade until after the President’s State of the Union Address. This is on at 1pm Sydney time.

Wednesday 13th (5.30 am)

Cloud divergence and the choppiness continues….at least we have consistency there. This knowledge offers me a HUGE advantage in that it protects my capital as I choose to not enter these choppy and whipsawing markets. 
The USDX fell and the EURX held up overnight amid positive comments from Super Mario:

The USDX is above the Cloud on the 4hr but in the Cloud on the daily so divergent and choppy:

The EURX is above the Cloud on the Daily but in the Cloud on the 4hr so divergent and choppy too: 
The TS signals there were all in some profit or near b/e have suffered with this choppiness overnight, as expected. As tends to happen though, these choppy markets often give reasonable trades during the US session off the 30 min charts. Some of the risk pairs have done so overnight.
The A/U has bounced a bit as it was just above major support. The previous short signal off the 4hr chart only gave 45 pips or so before reversing. The A/U gave 50 pips last night off the 30 min charts though:

The Kiwi also gave a healthy 80 pips during the US session:

The S&P500 also delivered an opportunity for a reasonable SPY trade. A TS signal came during when the S&P500 was at 1,512.71. I would have looked to buy the Feb  $151 Call Option:
The Feb $151 Call opened at $1.53 and was at $1.77 at the time of this write up. That is an increase of $0.24 cents.

A gain of $0.24 cents doesn’t sound like much but that is a return of about 16% for just a few hours. That isn’t bad given the choppy trading conditions!
ROIC = ($0.24/$1.77) x 100 = 16%

Cable: The Cable bounce back up off the 1.56 support area after some positive GBP data.

EUR/AUD: This pair has been choppy. I thought as much given the Aussie might have found some support at its current lows. I’m keeping an eye on it though!
So, we still have Cloud divergence on the Indices and, until that changes, this means we are in for more choppiness off the 4hr charts and better trades off the 30 min charts during the US session.


Tuesday 12th (9.30 pm)

All TS signals are into profit or at b/e now except for the A/J. 
It is a big night with President Obama’s State of the Union address and Super Mario speaks as well. I’d have stops to entry asap given these potentially market moving events.
There is still Cloud divergence so I will wait for a clear new direction.

Tuesday 12th (8.00 pm)

The EUR/AUD signal is back in profit:

The A/U signal is going on for more 

The Yen pair signals are down a bit still though.

Check out the Cable though. It is down now at a major S/R level. A close below the 1.56 level would be most bearish indeed:

Tuesday 12th (7.40 pm)

Stocks are looking a bit vulnerable here. 
There has been so market chatter about the need for a pullback, even if only a minor one, that I think stocks will struggle to move straight on up from here. So, here’s what I would like to see: The USD rally up to the 81.70 level…not too fast…over a few days or so…. This would give us a bit of a pause or pull back with stocks and that would keep the analysts happy! Then, I’d like the USDX to turn back down and head for my H&S neckline. That would then take the right hand shoulder formation up to about 5 months. This was the time taken for the left hand shoulder to form. So, we would have symmetry of time and size for my H&S pattern on the USDX. Then, I’d like the neckline to break so as to give a nice big ‘risk on’ rally! It’s my birthday in March…maybe this could be my present!

Tuesday 12th (5.20 pm)

The A/U signal is still in profit but the E/A and Yen pair signals are lagging. 

The EURX is trading above the Cloud on the daily chart. The 4hr chart is shown below. Price fell down through the Cloud and has made an attempt to move back above this. The Cloud may prove to be too strong a resistance level though. I’m keeping an eye on it. Remember, the USDX charts are currently aligned for ‘risk off’ so I’ll be watching to see if the EURX follows suite:

Please note I’m not taking any of these signals due to the current Ichimoku divergence but I’ll continue to post them out of interest. I’ve been warning that this Cloud divergence might lead to choppy 4hr trading and that is what we’ve got. I’m no genius spotting this pattern…just very methodical, analytical and focused. Remember I’m a hopeless cook though! This analysis continues to build a body of knowledge for me around the application of the Ichimoku Cloud to my TS trading system. As they say…knowledge = power!

Tuesday 12th (2.20 pm)

I mentioned over the w/e that a retrace up to the 81.70 level would satisfy some symmetry issues for the USDX. We might just get there!

Tuesday 12th (1.30 pm)

There isn’t much movement anywhere. I’m wondering if everyone is waiting until after G20!

Tuesday 12th (9.30 am)

Hmmm. I’m a little wary at the moment. The USD and Euro indices are both tracking up….together!

It is no surprise then that the E/U is tracking sideways.
The A/U TS signal is now in profit! This pair is only about 50 pips away from a major support trend line on the monthly chart though so I’d have stop to entry now ASAP in case this pair has a bit of a bounce back up from this support level. It might just get rather choppy if nothing else:

There is Yen weakness with all Yen pairs I watch giving new TS LONG signals. I’m wary though ahead of the BoJ meeting this week and the G20 on the w/e:

The EUR/AUD has given a weak TS LONG signal BUT I’ve noticed it seems to be trading within a new triangle pattern. I think I would rather give up a few pips and see this pair break out from this pattern before trading LONG here. I’m also wary with the A/U heading down to possible support.
We have the situation now where the USDX 4hr and daily charts look to be aligned for ‘risk off’ momentum. The EURX charts show choppiness with divergence between the 4hr and daily. This is making it difficult to determine the overall market direction. I’m still waiting for more consistent alignment across the Ichimoku Index charts before being confident with market direction and before taking a trade.

Tuesday 12th (6.30 am)

We are seeing choppy action with strange patterns across the currencies and stocks. The USDX is holding up above the daily 200 EMA BUT the the EURX has been trading up too. It is trying to get back above the 108.5 level:

Stocks have been choppy too:

I had mentioned that I was expecting choppy trading due to the Ichimoku divergence and that’s what we’ve got. It might be here for a bit longer given the look of the USDX daily and EURX 4hr Cloud charts. Both charts show price embedded in the Cloud which is a warning sign for choppy action:
USDX Daily Cloud

EURX 4hr Cloud 

The A/U signal has not been too good and I’m glad I didn’t take it.

I had mentioned that there are often cases of good 30 min charting opportunities during these choppy markets. The Cable gave one recently and has given another good 110 + pip trade overnight:

There are no other 4hr signals at the moment though which doesn’t surprise me one bit. 
Gold and Silver: Both of these have taken a tumble overnight and, sadly, also offered up good 30 min chart trades to SHORT
Gold: This has now broken down through the monthly support trend line and looks to close below this on the daily chart:
Gold 30 min

Gold 4hr

Gold daily

Silver 30 min 

Silver daily


This Ichimoku divergence is similar to a beach sign that says…’dangerous rip…no swimming’! I’m waiting for a clear direction in trend before further trading.


Monday 11th (9.15 pm)

The E/U SHORT signal from last week has drifted and looks to have leveled, or even closed, off.
I have had a new TS signal to SHORT the A/U BUT it is only about 60 pips above a major monthly support trend line. It may fall and head through this support BUT I think I’d rather see it breach this level before shorting it:

No other TS signals just yet. Not even on the EUR/AUD. Cloud Divergence like this often makes for choppy 4hr chart trading BUT great 30 min trading during the US session. I’ll have to look in the morning to see if that is the case again here.

Monday 11th (8.15 pm)

Check out the USDX daily Cloud chart. No trend so no trade!

The EURX 4hr chart has a way to go before being aligned with the daily for any ‘risk on’ 
This is when surfers would put their boards away for the day and wait for better waves!

Monday 11th (5.10 pm)

Still no major momentum moves.

Monday 11th (2.15 pm)

There still isn’t much action. The USDX is struggling to hold over the daily 200 EMA:

The E/U has barely moved! 
I’m waiting until later when Europe might help move things.

Monday 11th (10.15 am)

Aussie Stock Market:
Aussie stocks are at up at new highs and the XAO, All Ordinaries Index, will be testing the psychological and previous high 5,000 level sometime soon and maybe even this week. The next resistance level for this overall index is the 5,200 level.

The XJO is the index for the top 200 Aussie stocks and shows a similar pattern except that the 5,000 level is the recent high and main resistance there: 

These highs may prove to offer some resistance to further upward momentum and stocks may chop around for a bit here. They may also pullback a bit to gather steam for another assault, as suggested by the Elliot Wave indicator.

Monday 11th (9.15 am)

There hasn’t been much change on market open. I’m expecting it to be quiet today with Japan and China closed. My index charts aren’t open yet. The E/U was the only open TS signal. I’m still waiting to see if it holds above the weekly 200 EMA: