USDJPY 12-15-06

12-15-06

USDJPY

A short trade at 1.1780 was entered yesterday and it was exited at 1.1750 which was a place that the USDJPY had based earlier in the day. The trick to staying in the game is not to argue with the market. When areas of breakout support form, I use them as first targets if I am in a position that is counter trend to the market. If they are less than 3 to 1 risk to reward, I pass on the trade all together to reduce the risk on the trade. Even though the USDJPY has been strong, it is in an area of supply on both the daily and weekly charts which extends up to 1.1835. Watch for a sharp reversal if the USDJPY manages to rally up to the 1.1835 - 1.1850 area.

USDCHF 12-15-06

12-15-06

USDCHF

There was no trade in the USDCHF yesterday. The breakout trade above 1.2074 would have been a big winner if I had traded it. The USDCHF has built a couple of areas of support above 1.2114 as it absorbs the supply at 1.2150, and, if successful, it could rally to the next area of supply near 1.2226 from here. A breakout trade above 1.2155 with a first target of 1.2200 and a second target of 1.2226 to go flat is a possibility for this morning, as is a short trade at 1.2226 for later on today.

GBPUSD 12-15-06

12-15-06

GBPUSD

A long trade in GBPUSD at the range low of 1.9600 was entered yesterday and a partial profit at 1.9640 was taken. The trade was stopped out at breakeven overnight. I am going to trade the range from the 240 chart which is a range bottom of 1.9515 and a range top of 1.9670 for today. The GBPUSD has already put in a weekly low of 1.9464 on Sunday which is a different picture than the EURUSD. Enter a short trade at 1.9671 on a rally this morning with a first target of 1.9620 and a second target of 1.9570. The third target is 1.9515 to reverse to a long position. Move your stop to even after the first target and move the stop to 1.9600 after the second target is reached in case the 1.9570 area of support holds. The 1.9515 area of breakout support should be where the GBPUSD bottoms per the 240 chart if the 1.9570 area of support does not hold. Use a buy stop to enter once the GBPUSD trades below 1.9515 and a 10 pip stop loss after entry with a first target of 1.9560 and a second target of 1.9600. Move the stop after the first target to even, and to 1.9560 after the second target. We will try to ride the GBPUSD back to the top of the range.

EURUSD 12-15-06

12-15-06

EURUSD

The selling continued yesterday in the EURUSD down to the daily chart low of 1.3128 of the 1.3128 to 1.3364 trading range, with the weekly low of 1.3095 the next target. The long trade at 1.3202 was not entered since the bids at 1.3200 moved down to 1.3184 and the EURUSD never moved above 1.3200 for the rest of the day. The EURUSD should hold the weekly low of 1.3095, and I will enter a long trade on a pullback to 1.3095. My first target is 1.3140 and the second target is 1.3170. Move the stop loss to even after the first target and we will see if the dollar rally is going to end, and the EURO is going to rally into the end of the year. I am out if any candle closes below 1.3100 with a 10 pip loss after entry. If the EURUSD does not hold the weekly low, the dollar rally will continue next week.

USDJPY 12-14-06

12-14-06

USDJPY

There was no long trade in the USDJPY at 1.1705 yesterday since the low after the test of the area of supply at 1.1740 was only 1.1710. I am waiting for a test of 1.1780 to enter a short trade. The USDJPY is in an area of weekly and daily supply. There could be a sharp sell off in the USDJPY at any time.

USDCHF 12-14-06

12-14-06

USDCHF

The was a short trade in the USDCHF triggered at 1.2074 yesterday which was closed at 1.2040. There were several tests of the area of supply yesterday to allow an entry. The retail sales report that was dollar positive was what drove the price to the area of supply for the short trade entry. This morning, the USDCHF is going to try to absorb the supply at 1.2074 again. It may rally past this area, but there are two more areas above that should kill any type of breakout. I will pass on trading the USDCHF today to see if it forms a base near the 1.2074 area to move higher.

GBPUSD 12-14-06

12-14-06

GBPUSD

The GBPUSD long trade from 12-12-06 was closed yesterday at 1.9694. The range I will trade for today is between 1.9600 and 1.9713. The top of the range has already been tested this morning, so I will have to wait for a test of the bottom of the range for my next GBPUSD trade.

EURUSD 12-14-06

12-14-06

EURUSD

There was a long trade triggered in the EURUSD yesterday at 1.3240. The trade was a 10 pip loser,and the EURUSD sold down to the 1.3200 area where I originally wanted to enter. Unfortunately, I did not mention trading long if the 1.3200 area was tested in yesterday's email. The range for today in the screen shot below should be between 1.3220 - 1.3200 for support and 1.3265 - 1.3280 for resistance. That will be the range I trade for today.

USDJPY 12-13-06

12-13-06

USDJPY

There were no trades in the USDJPY yesterday. The USDJPY never sold down to the 1.1645 area to allow a long entry. The USDJPY traded in a range below the area of supply at 1.1720 all day and looks to be ready to move higher to the next area of supply at 1.1740. If the USDJPY does manage to rally up to the 1.1740 area, I would buy a pullback to 1.1705 for a long trade, but I will hold off for a short trade until the USDJPY trades up to the 1.1780 area of supply. You can short that 1.1740 area if you want the first time that the USDJPY trades up to it as long as you exit at 1.1705 which will be a fresh breakout support area.

USDCHF 12-13-06

12-13-06

USDCHF

There was no short trade in the USDCHF yesterday at my entry price of 1.2074. The high yesterday was only 1.2060 on the spike candle following the Fed decision. That area of supply at 1.2074 is still my next area to enter a short trade with a first target of 1.2005 if the USDCHF can make it past the supply between 1.2022 - 1.2040 this morning.

GBPUSD 12-13-06

12-13-06

GBPUSD

The was a long trade entry at 1.9601 yesterday in the GBPUSD. There were several chances to buy at that price. The first target of 1.9645 and the second target of 1.9670 were reached. Move the stop loss on the last contract to 1.9654 in case this 1.9695 area turns into a stage 3 top. A pullback should find support at 1.9670. If the GBPUSD rallies past 1.9705 instead, move the stop loss to 1.9694.

EURUSD 12-13-06

12-13-06

EURUSD

There was no new trade in the EURUSD yesterday. The low on the spike candle after the Fed decision was 1.3210 so it miss our entry at 1.3201. Anyone long from the day before should have closed the trade at the first target of 1.3234 using the trailing stop from yesterday's email. The 1.3280 area of supply is looking like a top of the range for now and the EURUSD will either base here to move higher, or it may sell off down to the 1.3250 breakout area. I would want to open a long position if there is a sell off down to that breakout area depending on the type of sell off.
If there is a spike down to the area I would buy near 1.3250. If there is a gradual sell off down to the area, I would buy closer to 1.3240 to give me a better profit zone back to the stage 3 top breakdown area that will form at 1.3270. Depending on the entry, I would use a 10 pip stop loss and a first target on the 1.3240 entry of 1.3270. The next targets will be 1.3300 and 1.3332 to exit and go flat. Move the stop loss to even after the first target and to 1.3264 after the second target. If there is a spike down entry at 1.3250 and a close back inside the range, the first target is 1.3285.

USDJPY 12-12-06

12-12-06

USDJPY

The USDJPY continues to move higher since testing the 1.1500 area on Friday with the areas of supply along the way acting as speed bumps. The 1.1620 area of support held on Sunday, and a breakout support area between 1.1645 and 1.1620 has now formed. The 1.1720 area of supply is in the process of being absorbed this morning, but the possibility of a pullback to the 1.1645 area of demand is increasing since the MA has reached the trading range between 1.1676 and 1.1699 and is flattening out. Because of this, I would pass on trading the USDJPY until it tests both the 1.1645 breakout area and the 1.1674 breakdown area at least once. If you are interested in trading that tight range, be sure to reverse your position using buy and sell stops and use tight 10 pip stops on both trades. Watch the action the second time down to 1.1645 for a break of support. It is possible that the USDJPY may move down to the 1.1620 area and below if the dollar downtrend resumes. The next area of supply to overcome is the 1.1760 area if the USDJPY absorbs the supply and moves higher instead.

USDCHF 12-12-06

12-12-06

USDCHF

There was no trade in the last email for USDCHF. The range has been expanded to a high of 1.2090 and a low of 1.1999. Inside the range is a breakdown area of former support at 1.2040 which may turn the USDCHF lower once it is tested. A short trade at 1.2040 with a sell stop is a possible trade, but I would rather short the 1.2075 area because it will be a bigger profit zone back to the 1.2013 breakout area which will form if the USDCHF rallies higher this morning. I will hold out for a test of the 1.2074 area for my next USDCHF trade.

EURUSD 12-12-06

12-12-06

EURUSD

The EURUSD extended the range lower on Sunday to a low of 1.3129. The last line in the email from Sunday said to place a buy stop at 1.3202 to enter a long trade once the EURUSD traded below 1.3200. If you are long from 1.3202, move your stop to 1.3234 to lock in a profit on the trade. If you are flat, I would be interested in buying a pullback to the 1.3202 breakout area using a buy stop once the EURUSD trades below 1.3200. After entry, use a 10 pip stop loss and a first target of 1.3235 followed by a second target of 1.3274. Move your stop to even after the first target. It is also possible that the EURUSD will rally higher without a pullback to 1.3200. If that happens, I will buy a pullback to the 1.3260 breakout area.

GBPUSD 12-12-06

12-12-06

GBPUSD

There was no trade recommendation for the GBPUSD in the last email. I would buy a pullback to the 1.9600 breakout area using a buy stop once the GBPUSD trades below 1.9600 and reverses higher. My stop loss will be 10 pips after entry and the first target will be 1.9645 followed by 1.9670.

GBPUSD 12-10-06

12-10-06

GBPUSD

There was no trade Friday in the GBPUSD. It looks like the 1.9521 area is acting as a trading range bottom for now. On the 240 minute chart, the next area of breakout support is at 1.9485. The first area of supply to worry about is 1.9561. I will wait for the range to be established on Sunday and Monday before I trade the GBPUSD.

EURUSD 12-10-06

12-10-06

EURUSD

The only currency pair that I gave a NFP trade recommendation for on Friday was the EURUSD. Watching more than one pair during the release of a report like the NFP is impossible. The NFP long trade at 1.3247 was triggered on Friday shortly after the release of the NFP report at 7:30 AM Central time. The exit was at 1.3360 when the EURUSD ran into the area of supply at the top of the range and retreated. If you followed the instructions to trail the stop tight after the entry, you were fine. CNBC is claiming that their interview with our Treasury Secretary Friday morning is what caused the sell off. You knew about the area of supply at 1.3360 for the EURO and the area of demand at 82.25 for the US Dollar Index days before their interview. That is the true reason for the reversal in the dollar on Friday. The US Dollar Index hit the 82.25 area for the second time and reversed. The low for the day on the $DXY was 82.24. The rest of it is meaningless. If there was no interview, the US Dollar Index would have reversed at 82.25, or it would have extended the bottom of the range a few ticks and then reversed.
The EURUSD is in a daily area of demand at 1.3200 and the US Dollar Index is in an area of supply at 83.33. I expect the EURUSD to trade in a big range between 1.3200 and 1.3280. It may only trade in a small range between 1.3200 and 1.3240 at first since the $DXY has an area of breakout support at 82.83. It could extend the range lower to about 1.3188. I will have to wait to see where the EURUSD opens on Sunday before I can say where to enter, but if it does trade below 1.3200, use a buy stop at 1.3202 to enter a long trade with a first target of 1.3340. If the $DXY reaches 82.83, sell the EURO position.

USDCHF 12-10-06

12-10-06

USDCHF

On Friday, I mentioned being interested in shorting 1.2056 when the USDCHF traded up to it. The USDCHF rallied up to 1.2056 and sold off to a low of 1.2015. The USDCHF then rallied back up to close at 1.2048. This area of supply is big. It will take quite a bit of time to absorb all the supply in this area. I will pass on trading USDCHF on Sunday since it has support at 1.2040 and resistance at 1.2056 which is a very small range. The 240 chart below shows a clearer picture of the range for the USDCHF going forward.

USDJPY 12-10-06

12-10-06

USDJPY

On Friday, I wrote to watch for a bounce at 1.1491 on a short trade. Hope you did. The USDJPY rallied up to the 1.1638 area of supply with no pullback. The 1.1666 area of supply is fresh and should produce a sell off the first time that the USDJPY trades up to it. If the USDJPY rallies up to it on Sunday, then it should form a trading range between 1.1620 and 1.1670 if the USDJPY is going to move higher from here. If 1.1620 does not hold on the bottom, the USDJPY could fall back to the 1.1560 - 1.1550 area. I will wait to see what kind of range forms on Sunday and Monday before I trade the USDJPY again.