last week's call & this week's too

... last week's forecast wasn't too far short of the mark imo. EUR found resistance at 1.30 and went down to test the target at 1.26. Downside action for cable kicked in around 1.46 but just fell short of the target at 1.41. I was long for usd/jpy and although price failed to fall to my trigger at 92, going long at 95 saw a tidy profit just shy of 98. I was a wee bit out on chf, however no downside break of 1.15 meant no short was opened.

...this week, eur/usd has turned slightly more bearish and I'll be looking for downside action within a range of 1.2850 and 1.25. the spinning top on cable will prompt me to look for opportunities to sell sterling against the dollar around 1.4370. usd/jpy was proudly bullish last week. this could well continue and I may try buying around 97 with a target just shy of 100. However, if the pair hit 100, I will be looking to short. usd/chf is range-bound and I'll be perking up when price action nears the boundaries of the range, that's 1.15 and 1.18.

candles say eur/usd to continue its slide

Only one call this week, we're bearish on eur/usd (order levels here) :

We taking the long upper shadow on last week's black as a bearish sign. Of course, the current run of weekly blacks and the fact that last week's candle could qualify as a bullish inverted hammer give food for thought. However, the fact that the body of the candle is totally below 1.30 convinces me to run with the bears. Only time will tell.

I'm out on the other majors. True, cable was well up last week and completed something between a bullish harami and a bullish piercing line. Only the fact that cable closed below the psyche level of 1.45 kept me out. I would consider going long after a breakout/retest of 1.45.
usd/jpy traded inside the previous week's candle. The pseudo-harami that we are left with might suggest upside action but the close below the key level of 90.00, means it's no go for me.
The upmove of the past month or so from usd/chf seems to be petering out. However, 1.15 needs to be broken down before I'm tempted.

candle calls for this week (calls on eur & chf)

...this week is the last full trading week of 2008 and should prove to be full of interest. the fed are ensconced behind closed doors as I write and will announce their interest rate tomorrow, 19:15 gmt. the consensus is for a further 50bps cut to 0.50%.
the other big story this week will no doubt be the US Treasury's move to save the US auto industry from collapse. it's all very vague at the moment and this week should see the answers to the main questions:
how much?
from where? (george w said that using the tarp funds was a 'possibility')
and for how long? (most likely until obama takes the helm)

...as I was saying yesterday we've two calls:
eur/usd (dec 1-5 & dec 8-12): last week's long white confirmed the doji of the week before and could possibly mark the breakout of the narrowing range that eur/usd has been trading in for the last 6 0r so weeks.

forecast: the euro looks set to continue its recovery.
support: 1.3290
resistance: 1.3645




usd/chf (dec 8-12): the franc woke up and last week's impressive long black leads us to expect more downside action this week.

forecast: the candles remind us that december is often difficult for the dollar.

support: 1.1605
resistance: 1.1920




usd/jpy (dec 8-12) last week's long spinning top charts downside pressure as traders ran for cover. However, the dollar rally at the end of the week marked speculation that the BoJ would intervene to weaken the yen. Japan's finance minister left me no wiser on friday and that long lower shadow on the candle bodes caution.

forecast: the candles caution against pitting your account against the BoJ!
support: 89.0
resistance: 93.0


gbp/usd (dec 1-5 & dec 8-12): sterling tried to strengthen but couldn't break resistance at 1.50 and spent the week inside the previous week's range. Although the bias seems to be on the downside, the candles are holding their horses.

forecast: the candles are watching this ugly-contest with interest
support: 1.4660
resistance: 1.5150

thanks Mike G + this week's calls

...your comment is much appreciated Mike. I am far from feeling discouraged and I share your belief in the value of candle analysis. The problem with the fundamentals is that there are so mony factors in play with intermarket influences in addition to the more obvious data releases. In the new year, I hope this blog will develop to make more precise calls (with orders) primarily based on the candles but bringing other technical features and the fundamentals into play.

this week we're looking at two calls, one bullish for eur/usd and the other bearish on usd/chf. full details to follow tomorrow.

forecast for week Nov 24-28 (calls on the yen and the swissy)

eur/usd 17-21 nov. the nut tightens and the tension mounts as the week forms another doji inside the range of the previous week. I'm still waiting for a clean breakout, now of either 1.30 on the upside or 1.24 on the downside.

forecast: the candles remind us of the virtues of patience






usd/jpy 17-21 nov. a beautiful black doji with lower highs and lows than last week's candle suggests a bearish sentiment is in order. it must be bourne in mind that the last bullish week (4 weeks ago) came on hints that the bank of japan was ready to weaken the yen if they saw fit. support: 92.50 resistance: 97.70

forecast: the japanese candles say that the yen should strengthen but the japanese central bank may disagree




gbp/usd 17-21 nov. This inverted hammer is a weak bullish signal and sterling's inability to close last week above 1.50 makes it weaker still. An inverted hammer always needs confirmation (higher volumes on up moves or divergence from stochastic) as well as a clean break out of 1.50. Cable will find support at 1.4550 and resistance after 1.50 at 1.5250.

forecast: will cable rise or will cable fall? we must wait, for only time will tell




usd/chf 17-21 nov. A long white as the SNB cut and usd powered through 1.20. Those long shadows do make one pause for thought, but this is a bullish candle. Support at 1.1880 and resistance at 1.25.

forecast: the candles echo the swiss national bank when they say buy the greenback.

forecast for week Nov 10 - 14

eur/usd: weekly candle 3-7 Nov. This candle pattern marks the second week of correction of a down trend and is a doji. It signifies uncertainty but its high is lower than the previous week and the correction up is less. This leads me to continue to be bearish on the euro and give last week's levels of resistance (1.3275) and support (1.25 then on to 1.23).

forecast: the candles are coy yet whisper sell the unit against the buck




usd/jpy: weekly candle 3-7 Nov. This candle pattern is on the top of a correction of a down trend and is called doji. It signifies uncertainty and we should hold our horses. I anticipate support at 95.50 and resistance at 102.50.

forecast: the candles advise you to make yourself comfortable on that fence.






gbp/usd: weekly candles 27-31 oct & 3-7 Nov. This two-candle pattern is on the current down move and is called engulfing. In this position it is a strong bearish signal. Initial target/support at the tweezers (identified last week) at 1.5280 with resistance at 1.61.

forecast: the candles say that sterling is set to slide.





usd/chf: weekly candles 27-31 oct & 3-7 Nov. This two-candle pattern is on the current up move and is called engulfing. In this position it is a strong bullish signal and if we get a daily close above initial resistance at 1.18, next target is 1.19. Initial support at 1.16 with strong support at 1.1470.

forecast: the candles say that the dollar will rock as the swiss franc rolls.