prep thread 7-13 feb 2011, page-12

Wow great response and big thanks Forex Crew :))

Here is my TRADING take on the EURUSD.. for a bit more on the weekly and daily, check the blog which contains a greater length post (see sig for the URL)

Concentrating on the Potentially useful TRADING stuff, and for that a zoom in to the most recent price action on the daily:

On this section of the daily chart, I have used a fibbonaccie retracement on the recent rise to provide levels of potential support OR downside targets if the opportunity to short into an apparent down trend measured in days and supported by recent MACD and Stochastic sell hints (crossovers divergence and moving out of the overbought area.
The 50% and 61.8% levels of high worth are highlighted by the blue line segements. and these areas as targets or levels of support will be noted should price get there in the not too distant future.

of non fibbonacci note at is the black line segment that highlights an area of previous resistance, and als happens to be at the level of the dashed pinkish 41 period ma (fxbootcamp) which may provide slightly higher support than the fib levels.

A zoom into the 4hourly to digest this latest uptrend:

on this chart a simple NON Elliot 5 wave sequence has been marked out in green small numbers...
In addition to the thick black segment from the daily, tow segments marked as blue dotted highlight recent support and resistance levels as well as a thin red line showing recent and historical support.

I have marked out TWO potential price movement scenarios I cna imagine unfolding (though by no means certain) with sets of brown and grey arrows.

I have placed alarms on certain levels as highlighed by dotted black arrows.

I cna see the potential that the initial drop down from the point marked with the green 5 Could already have the internals of its own five wave structure, and it would not surprise if the initial move on monday is up but that is way too preemptive at this stage for me to take a position.

Lines on the mACD highlight divergence on both the moving averages and the histograms... Esoteric winkinatcha stuff suggests that if downside does occur, that the level of historical price at the extreme histogram at the beginning of HISTOGRAM divergence (marked by thin Vertical line round the 14th of Jan is a legitimate downside target.

As a further caveat, I have found recently that Mondays tend to be a bit waffly and MAY not be a good time for me to trade while the greater players set themselves up for the rest of the week, often giving Tuesday as the better level to try and trade actively.

And of course, the Monday Gaps MAY occur and provide potential entries but they have to occur first.

So in summation,
I beleive that there is a high potential that price MAY go to further downside before the next week is out and for this week I will initially be concentrating on looking for ways to capture conjectured downside..
I would like to see a lower high before taking a strong short on the 4 hrly or hourly, and I will be watching both for initial downside OR Upside to give me clues as to the strength of marked support and resistance.

Good trading to all

;)