Wow, I can’t believe it is December already.  Oh well, nice weather here where I am so I can’t complain

Relatively calm day on Monday for the pair as not only did it stay within the range mentioned in yesterday’s post, it  only moved about 100 pips.

There are short term trades in here, but ultimately this remains a range bound pair.

Resistance is at 1.5040 with a move beyond that indicating a move to test swing highs at 1.5080.  Targets and resistance beyond is at 1.5100, 1.5120 and 1.5140-1.5150.

Minor support is at 1.5000 with more substantial support just below recent swing lows at 1.4970.  Support beyond is at 1.4950 and 1.4920.  While a move below this is not highly probable, targets beyond are 1.4890, 1.4870 and 1.4840.

Cory Mitchell, CMT
Chief Market Strategist
-Know your risks when trading. Please read the Legal Disclaimer page.

My friends over at INO are currently offering 4 free online video seminars from master traders via the link below.

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Some strength in early trading as the the pair moved above minor resistance at 1.5020.  There is a resistance area between 1.5060-1.5100 and so far that level has held, as the pair currently trades at 1.5057.  Beyond 1.5100 is resistance at 1.5140.  A break beyond 1.5150 would indicate another swing higher.  With the average daily range sitting around 130 pips it would require a beyond average volatility day to move beyond this former high.

Support is at 1.5000, 1.4970 and 1.4950.  If needed, further support is at 1.4920.

Keep an eye on the US session, with the holiday last week the US session could be lively, although there is little in the way of economic data due out today.

Today’s action is expected to be contained with the range which is visible on the hourly chart.

Cory Mitchell, CMT
Chief Market Strategist
-Know your risks when trading. Please read the Legal Disclaimer page.

My friends over at INO are currently offering 4 free online video seminars from master traders via the link below.

Find Your Free Seminars here.

I was going to not post tonight, but given the sharp downward movement in the EUR vs. the USD I thought I should post at least a few comments.

Right now the pair has fallen back and is within the former range that we broke out of yesterday – it is below 1.5000.  Some sort of pullback was likely, in fact a large percentage of breakouts pull back to their breakout point.  On the hourly chart we are above the last swing low, still indicating short term strength.  And just as reduced volume had to be taken into account on the breakout, the lower volume has be considered on this slide.

Friday is a shortened session for the US markets, and can again mean sharp movements due to reduced liquidity.

Support is the lows of the recent swing at 1.4935.  The long tail here represents aggressive buying off this level.  Support beyond is at 1.4920 and 1.4890.  A move below this would indicate likely movement to the low of the range at 1.4800 with support along the way at 1.4870 and 1.4830.

Renewed upward pressure is not really present until a move back above 1.5030.  Targets/resistance beyond is around 1.5060, 1.5090, 1.5110-1.5120 followed by Wednesday’s high at 1.5145.

Cory Mitchell, CMT
Chief Market Strategist
-Know your risks when trading. Please read the Legal Disclaimer page.

My friends over at INO are currently offering 4 free online video seminars from master traders via the link below.  After that you can decide if you wanna see more… INO TV is the only place where members have access to over 150 experts and 500 hours of seminars, for one price. INO TV gives its 30,000 members access to massive amounts of educational material that has been handpicked to provide you with the most for the least.

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I am posting this forex trading analysis a little earlier .  I may take tomorrow off with the US markets closed as it is likely to be a quite day (volume wise) anyway.  Friday as well I imagine will be subject to sharp movements due to limited liquidity.

Anyway, the pair finally snapped out of its range and took out of the profit target of 1.5100-1.5115.  Currently the pair trades right near1.5140.  This is a clear break from the range and appears to have extended further than a stop-hunt would.

Support is now the old resistance levels if we retreat. These levels are 1.5060, 1.5040 and 1.5000-1.4985.  While we did break out, ideally it would be nice to see rates above 1.5100 on Monday.  With soft markets due to holidays in the US this cannot be taken with the same fervor a breakout would during a regular trading week.  Trade the trend but don’t load up until this move is confirmed in some way (multiple closes above 1.5100, a retreat back to support and then a push back higher, etc).

The targets for this move are 1.5280-1.5315.  We have horizontal resistance come in around 1.5280 which is the former low of a trading range from well back in time.  The range that we just broke out of also provides a profit target of roughly 1.5300 (calculated as 1.5060-1.4800=260+1.5060=1.5320).

In the short term if we continue higher the target is 1.5160.  Minor support is at 1.5100.

~Cory Mitchell, CMT

Follow the Trend But Don’t Get Attached to It.

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If we get back above 1.5000 we have resistance at 1.5015-1.5020, 1.5045 and 1.5060.  A break above that level indicates a renewed upward move.  Getting above 1.5075 indicates another swing higher over the longer term and a target of 1.5100-1.5115.

A drop below 1.4920 indicates a move back to 1.4880.  If the selling continues and 1.4860 is penetrated resistance is 1.4830 followed by 1.4800.

We are still in a well defined range.

As a little bonus tonight, I got a forex video for you.  In today’s video I’m going to share with you a wonderful way to look at the forex markets and determine which way they are headed in a matter of seconds. We’ll be looking at three different cross rates and how they all correlate together in a way that I think may surprise you.

Finding the trend in the foreign exchange markets:
http://www.ino.com/info/487/CD3784/&dp=0&l=0&campaignid=3

Have a great day/night!

Cory Mitchell, CMT
Chief Market Strategist
-Know your risks when trading. Please read the Legal Disclaimer page.

Nice rip off the open and right to near 1.5000 which was the resistance area mentioned in yesterday (well, I said 1.4990 on the high end).

Based on the range that has been established, it looks like we are going to move back down today within that range.  The only thing that would change this is if we get back above 1.5000 in which case we have resistance at 1.5015-1.5020, 1.5045 and 1.5060.  A break above that level indicates a renewed upward move.

A drop below 1.4920 indicates a move back to 1.4880.  If the selling continues and 1.4860 is penetrated resistance is 1.4830 followed by 1.4800.

Not too much else to say as we are currently in a well defined range.

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Cory Mitchell, CMT
Chief Market Strategist
-Know your risks when trading. Please read the Legal Disclaimer page.

The pair has pulled off the low of the range (1.4800), and looks prepared to move back higher to test some former highs.  This will either be confirmed or rejected based on movement through the following levels:

A move back above 1.4890 indicates movement back above 1.4900 and a test of recent swing highs at 1.4930-1.4940.  We have trendline support above this at 1.4950-1.4965, this will also act as resistance.  Beyond is resistance at 1.4980-1.4990.

Keep in mind that old support and resistance become new resistance and support respectively if a level is moved through and then retreats back.  Movement through one level indicates movement to the next, and failures are likely to move back to other levels mentioned.  Support and resistance does not mean rates will move exactly to the price mentioned, rather they are profit taking opportunities in those areas (or  possibly entry prices if moved through) as retracements are more likely around those levels.  This is misunderstood by many traders, and I will elaborate on it on an upcoming post on my blog.

A drop back below 1.4840 is our first indication of a move lower.  The trend line this move would break is short term and not of high importance.  The closest major level is 1.4800.  A break below that would be significant.

A break below 1.4800, if it is legit, will find support at 1.4770, 1.4740-1.4730 then 1.4700.  If the break is not legit and just a stop run, it will likely tucker out by 1.4780-1.4770 and then reverse.  I say that only we because we all know there are a pile of stops sitting down there.

Keep in mind that since we know stop hunting is a common practice, whether intentional or not, and is a strategy in and of itself.  If there is a level that is likely to have many stops it, it seems to create a gravitational pull and can result in a quick surge but often retraces.  Watch and see if you see this happening around critical levels.  If there is interest I can post an article on how to trade this phenomenon.  (This is exactly what I said in the previous post, just in case it seemed familiar).  Have a great day trading everyone!

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Cory Mitchell, CMT
Chief Market Strategist
-Know your risks when trading. Please read the Legal Disclaimer page.