Tuesday, January 27, 2009

candle calls January 26-30

Now on to this week's calls. I made two on Sunday night when I said I was selling pound against the dollar and buying the dollar against yen.

Let's take a closer look:
gbp/usd: last week's long black smashed through long-standing support. We are bearish on cable this week.
support: 1.3500, resistance: 1.4370

usd/jpy: last week's long black formed an bearish engulfing with the previous week's short white. however, those long lower shadows and the tweezers which are formed by last week's candle and the similar long black of dec 15-19 suggest a bullish move for the pair.
support: 87.00 resistance: 90.00, then 92.40 and then 94.00.

candles burn my fingers

If you cast you mind back to last week (jan 19-23), you'll remember that we were selling usd/chf. this because resistance had held at around 1.1283 giving us a tweezers pattern of sorts which coupled with the spinning top of jan 12-16 seemed enough to get bearish (pretty tenuous in hindsight tbh). Anyhow, tenuous or not, the greenback had a good week against the greenback. It opened at 1.1140 and closed at 1.1558 , moving 418 pips against us. That's a forecast rating of -3.62%

We were bullish on usd/jpy, mainly because of the weekly close above 90 and jan 12-16's bullish spinning top with a long lower shadow. However, this too was not to be. The pair opened at 90.99 and closed at 88.82, moving 217 pips aginst us. That's a forecast rating of -2.44%

The week's total rating came in at -6.06%, and reduces the running total to
14.98 - 6.06 = +8.92%

Sunday, January 25, 2009

What a week! (apologies)

It's been one hell of a week and I've been painfully aware that I have been lacking in the blog department.
I'll post a full report on last week's (crappy!) calls.
This week the candles are bearish on gbp/usd and bullish on usd/jpy.

Until tomorrow, cheerio.

Sunday, January 18, 2009

Quick call as the market opens...

The week's a couple of hours underway so this is a quick post to make my calls:
usd/chf sell
usd/jpy buy

the full details will follow tomorrow as per usual.


Saturday, January 17, 2009

the candles continue to edge ahead

...another positive week for our calls. the dollar gained against the euro as concerns for the integrity of the 16-nation unit grew as Greece's credit rating was downgraded and Portugal, Ireland and (most worryingly) Spain said to be on the watch list. The ECB cut rates by the anticipated 50 bps to 2.00%. this precipitated further euro weakness perhaps because it's seen as too little too late or because Jean-Claude Trichet cued up another round of cuts for his March rendezvous. eur/usd recovered somewhat on Friday when the Bank of America was thrown another US government lifeline, bringing some much needed optimism to the markets.
With eur/usd opening the week at 1.3455 and closing on Friday at 1.3288, our short call brought in 167 pips. This gives us a forecast rating of +1.26%

Our buy call for usd/chf saw modest success with the pair opening at 1.1135 and closing at 1.1170. This brought a princely 35 pips into the pot. 35 pip is 0.31% of the closing price and thus gives us a forecast rating of +0.31%

All in all, the week's forecast total is +1.57%

Bringing our running total to +14.98%

Next week will be a difficult one to call with the Martin Luther King Day holiday and Barack Obama's inauguration bringing uncertainty to the markets. I'll be posting the candle signals tomorrow - until then, have a good weekend.

Thursday, January 15, 2009

e-book from Nick B

Here's something that's well worth a look, Nick B's ebook on master candles. At 17 pages, the book is clear, concise and very useful for anyone wanting to learn more about candlestick analysis.

Monday, January 12, 2009

calls for eur and chf, week January 12-16

...let's have a closer look at the signals I mentioned yesterday:

eur/usd (jan 5-9): this long black continues last week's euro bear signal and we'll continue to sell the 16-nation (hello slovakia!) unit.

forecast: the candles say that eur is a southbound train.

support: 1.3200
resistance: 1.3750

usd/jpy (dec 29-jan 2; jan 5-9): this two-candle pattern is a bearish piercing line and the long upper shadow on the black gives it extra kick. however, last week's close above 90.00 made us wary that the BoJ would be setting its intervention rumour-mill going once again. which means we're sitting on our hands.

forecast: we're afraid of the big bad bank!


usd/chf (dec 22-26; dec 29-jan 2; jan 5-9) last week's long white gives weight to the previous week's hammer and closes above the long black of christmas week. it's a bull signal, though that longish upper shadow makes us a wee bit nervous.

greenback to strengthen against the franc


gbp/usd (17 nov-9 jan): this pic shows the range that cable has been trading inside for the last two months. I'm setting the boundaries of the range as the open of the long black (10-14 nov) and the close of the spinning top two weeks ago (29 dec-2 jan), giving us a top of 1.5770 and a bottom of 1.4499. It's difficult to see us getting a weekly signal until there's a clear day breakout of this range. However, the range provides good opportunities for intra-day trading once price tests either support or resistance.

forecast: We're holding fire.
resistance: 1.5770

Sunday, January 11, 2009

candle calls for the week

...just a quick post to make this week's calls as the markets open. the candles are short on eur/usd and long on usd/chf, so we're dollar bulls again. we're sitting on the fence with cable and usd/jpy. full details to follow tomorrow.

Friday, January 9, 2009

yen and euro calls reviewed

...the candles were dollar bulls on both eur/usd and usd/jpy this past week. the close of the week sees one good call (sell eur/usd) and one bad (buy usd/jpy). however, the balance sees our weekly forecast rating in positive territory.

the recently rampant euro struggled against most currencies this week, most notably falling the most against sterling since the euro's inception 10 years ago. the dollar was no exception: the euro opened the week at 1.3905 and promptly started falling to hit 1.3311, only to rise again against a backgound of weak US data, closely followed by the FOMC meeting minutes which showed the Fed in a distinctly downbeat mood. the rise continued until US NFP came in less worse than many on the floor feared. the dollar strengthened accordingly to close the week 476 pips down on the week at 1.3429. this gives a forecast rating of +3.54%
usd/jpy also kicked the week off in the right direction, but the move was scuppered on Tuesday too. Friday's NFP couldn't do enough and the pair fell 184 pips over the week to close at 90.22, leaving us with a forecast rating of -2.03%

the rating total for the week is, therfore (3.54 - 2.03) +1.51%, which makes the running total (11.90 + 1.51) +13.41%.

Saturday, January 3, 2009

following the candles into 2009

...the new year opens to the first full trading week of the year and the candles shine out against the gloom predicted by pundits in all camps. the events of the coming year are way beyond the scope of this blog, however, the candles do have something to say about the coming week. i spy dollar bulls on eur and jpy, while the candles flag caution on chf and gbp.

let's take a closer look:
usd/jpy (dec 15-19; dec 22-26 & dec 29-jan 2) that long lower shadow on the black adds strength to the harami reversal signal from the black and the following white. last week's white adds further confirmation.

forecast: these three candles point to further yen weakness. however, I'll be waiting for a clean breakout of 92.60 before making a move.
support: 90.85
: 94.40

eur/usd (dec 22-26 & dec 29-jan 2) this bearish engulfing could well spell a euro reversal around the key psychological level of 1.40 and the black candle's long upper shadow brings more force to the argument.

the candles are telling me to sell the euro.
resistance: 1.4080
support: 1.3570

usd/chf (dec 15-19; dec 22-26 & dec 29-jan 2) the two long lower shadows of the first and third candles form tweezers (or as near as dammit!) testing support at around 1.0500. last week's dollar up-move against the franc wasn't strong enough to anticipate more dollar strength this week. I shall sit tight and wait for a breakout of the range of the dec 15-19 candle.

forecast: wait-and-see: the swissy is taking a breather.
support: 1.0500
resistance: 1.1200

gbp/usd (dec 29-jan 2) although sterling seems set for more weakness in the coming weeks this spinning top at the key psych level 0f 1.45 is giving me food for thought.

forecast: spinning top signals uncertainty so there's no call on cable this week.
support: after 1.45, look for 1.40 and then down to 1.3330
resistance: 1.4930
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