Pierre DuPlessis on May 21, 2013
What’s up, down or sideways for the week here at Forex Mentor Pro?
Well my friends, let’s have a look but just before we start:
Important notice – We have on some pairs the 55EMA in my potential trading zones but looking at the bigger picture, we way out from those 200 mothers in law EMA`S – so please be careful. If these 55 EMA`s don’t hold, we can easily drop to the mother in laws for supper.
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Truth saying for the week:
` Paint a picture in your mind, create a movie in your head and play that movie again and again – you are the star in your own life! `
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`Red Flag` News that can make you loses your pants:
You can use the following web site for scheduled news and times for the week: http://www.dailyfx.com/calendar
Don`t take any trades just before `Red Flag` news. If you are already in a trade, protect your entry. I don’t want to meet up with you at Little Beach, Maui, Hawaii. Did you know this is a nudist beach? For future reference, have a look at the 4th of April 2013 at all the JPY pairs what happened with price after `Red Flag` news came out. ALWAYS TRADE WITH A STOP!
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This is my current `Earth and Sky Trading Zones` – Please take note of the time frames I am looking at. Remember, if price don’t pull back on the pairs you trade and make new lows/highs follow price with your fib to get the new potential trading zones.
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1) Euro Index on the 4 hour chart:
Notes: Looking at the Daily chart then we are in an ascending triangle – however on the 4 hour chart we are trapped between 108.09 where we have the 34/55 EMA plus weekly main pivot and the mother in law at 107.86.
In short – this to me is in no man’s land.
Correlation: Remember that the following pairs make out the `Euro Index Basket` – The Euro/Dollar, Euro/JPY, EURO/GBP and the EURO/CHF. (They all move in the same direction) Use the `Euro Index` for extra confirmation and information to trade the basket pairs. If you don’t have the index on your platform…download a demo account with Admiral Markets @ http://www.fxservice.com/
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2) Euro/USD on the 4 hour chart:
Price is under the 200 EMA
34 EMA (sky) is under the 55 EMA (earth)
Direction: Short
Potential trading zone: 1.2913 to 1.2971
Potential area to look for reaction: 1.2913/32.
Stochastic: Getting to overbought
MACDEE Divergence: No
Did we open with a GAP? No.
Notes: Keep your eyes on the 1.2900 level.
Correlation: This pair is positive correlated (moving in the same direction) as the Euro Index, Euro/JPY and the Euro/GBP. Be careful; don’t take the same trades on these four pairs at the same time!
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3) Euro/JPY on the 4 hour chart:
Notes: Price is ranging between 132.65 and 131.06. These two levels also hold hands with this week’s weekly pivot points.
Correlation: This pair is positive correlated (moving in the same direction) as the Euro Index, Euro/USD and the Euro/GBP. Be careful; don’t take the same trades on these four pairs at the same time!
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4) Euro/GBP on the 4 hour chart:
Notes: Looking at the Daily chart then we are trapped in a triangle. We have loads of EMA`S to the upside at 0.8482 that can keep price down. Looking at the 4 hour chart then the 0.8454 level is where we have the 34/55 EMA and this is currently holding price down – however I feel this is in NO MANS LAND.
Correlation: This pair is positive correlated (moving in the same direction) as the Euro Index, Euro/Dollar and the Euro/JPY. Be careful; don’t take the same trades on these four pairs at the same time!
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5) GBP/USD on the 4 hour chart:
Price is under the 200 EMA
34 EMA (sky) is under the 55 EMA (earth)
Direction: Short
Potential trading zone: 1.5269 to 1.5326
Potential area to look for reaction: 1.5269 and 1.5299
Stochastic: Open and trending up
MACDEE Divergence: No
Did we open with a GAP? No
Notes: Price has touched the 50% fib level at 1.5269 but the 60 min bull trend is still in place.
Correlation: This pair is positive correlated (moving in the same direction) as the GBP/JPY pair. Be careful; don’t take the same trades on both pairs at the same time!
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6) GBP/JPY on the 4 hour chart:
Notes: We are ranging between 156.72 to 154.99. These two levels are also the weekly pivot point areas.
Correlation: This pair is positive correlated (moving in the same direction) as the GBP/Dollar pair. Be careful; don’t take the same trades on both pairs at the same time!
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7) AUD/Dollar on the 4 hour chart:
Price is under the 200 EMA
34 EMA (sky) is under the 55 EMA (earth)
Direction: Short
Potential trading zone: 0.9871 to 0.9951
Potential area to look for reaction: 0.9900
Stochastic: Open and trending up.
MACDEE Divergence: No
Did we open with a GAP? No
Notes: Price is currently kept down at the weekly main pivot point but I would prefer a jump at least to 0.9900 before looking to short.
Correlation: This pair is positive correlated (moving in the same direction) as the AUD/JPY pair. Be careful; don’t take the same trades on both pairs at the same time!
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8) AUD/JPY on the 4 hour chart:
Price is under the 200 EMA
34 EMA (sky) is under the 55 EMA (earth)
Direction: Short
Potential trading zone: 100.80 to 101.41
Potential area to look for reaction: 100.80 and 101.00
Stochastic: Open and trending up.
MACDEE Divergence: No
Did we open with a GAP? No
Notes: Price is currently kept down at the mother in law at 100.78. PLEASE TAKE NOTE OF THE TRIANGLE WE ARE IN ON THE 4 HOUR CHART.
Correlation: This pair is positive correlated (moving in the same direction) as the AUD/USD pair. Be careful; don’t take the same trades on both pairs at the same time!
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9) USD/CHF on the Daily chart:
Price is above the 200 EMA
34 EMA (sky) is above the 55 EMA (earth)
Direction: Long Potential trading zone: 0.9641 to 0.9580
Potential area to look for reaction: 0.9600/11 Stochastic: Open and trending down.
MACDEE Divergence: No
Did we open with a GAP? No
Notes: Price is currently finding support at the weekly pivot but I would prefer a bigger pullback into the preferred trading zone.
Correlation: This pair is NEGATIVE CORRELATED (moving in the opposite direction) as the Euro Index, Euro/Dollar, Euro/JPY and Euro/GBP pairs. Be careful; DO NOT OVER EXPOSE YOUR ACCOUNT BY PLACING OPISITE TRADES ON THE ABOVE PAIRS.
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10) USD/JPY on the Daily chart:
Price is above the 200 EMA
34 EMA (sky) is above the 55 EMA (earth)
Direction: Long
Potential trading zone: 97.94 to 95.26
Potential area to look for reaction: 99.33/ 99.53
Stochastic: Open and trending Down
MACDEE Divergence: Starting yes
Did we open with a GAP? Yes
Notes: I prefer the daily chart this week. We have the 200 EMA on the 4 hour chart at 99.33 with the daily 55 EMA at 98.53 before we get to the trading zone…..these two levels are also around the 38.2 fib level…..so keep your eyes on it for a possible road block.
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11) USD/CAD on the 4 hour chart:
Price is above the 200 EMA
34 EMA (sky) is above the 55 EMA (earth)
Direction: Long
Potential trading zone: 1.0197 to 1.0139
Potential area to look for reaction: 1.0176 and 1.0160
Stochastic: Open and trending down
MACDEE Divergence: No
Did we open with a GAP? No
Notes: Be careful with this pair this week. This pair is known not to respect EMA`S. ………………………………………………………………………………………..
12) USD Index on the 4 hour chart:
Price is above the 200 EMA
34 EMA (sky) is above the 55 EMA (earth)
Direction: Long
Potential trading zone: 83.65 to 83.29
Potential area to look for reaction: 83.45
Stochastic: Open and trending down
MACDEE Divergence: YES!!!!!
Did we open with a GAP? No
Notes: We have big divergence on the MACDEE!!
Correlation: This pair is NEGATIVE CORRELATED (moving in the opposite direction) as the Euro Index!
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Have a good one mates