A-B-C-D Trade - page 146
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Continuance from last post.
At 22:30, EUR/USD surfaced above our PSQ9 0-degree line (red) and extended to its 138.2%, from plot (not shown):
Low = Apr 26th 00:30 1.44921 and High = Apr 26th 09:00 1.46512.
The gain from the pullback to extension was about net 100 pips.
This top also hit our fibo fan's 78.6 (yellow).
The retrace was 38.2% from plot using Apr 26th 11:30 Low 1.45971. It also met the PSQ9. This bounce down captured about 30 net pips.
We'll comment more extensively on today's FED rate decision & verbiage (16:30) and Bernanke's press conference (18:15) later on.
Let's again resume our focus on the EUR/USD 30-min chart. We removed some clutter that no longer is required, in the CPD and wide fib plot.
EUR/USD made a swing down to the fibo fan's 86.6% at 16:30. Temporary USD strength at least partially due to S&P downgrading Japan's Outlook to Negative.
We determined that this swing is Point C (38.2% retrace) of A-B:
A = Apr 26th 06:00 low 1.45062 and B = Apr 26th high 1.47125.
This produced FE 100 = 1.48359.
We also expanded our fib channel to next levels. As we know the number 1.618 is the "Golden Ratio". After the last fib of 2.618, we multiply that by 1.618 to arrive at 4.235. Again, we multiply 4.235 by 1.618 to get 6.854.
We can see the 23:00 candle hit the FE 100 (white), and shortly thereafter hit the fib channel's 6.854 (lime). The 6.854 label cannot be seen as it is off screen.
Prior to those hits, the pair met resistance at the PSQ9 90-degree diagonal line (red). It bounced down but was supported by the yellow fibo fan's 78.6%.
Plotting from low at Point C, and high when it pivoted at the PSQ9, we get a 138.2% extension just about where candlewick hit the lime 6.854 fib channel. This plot not shown, but you can plot it.
AUD/USD generally moves with EUR/USD, and this week has been no exception. We have an ABC that extended to its FE 100, as shown on the attached 30-min chart.
The difference in this instance, as opposed to EUR/USD, is that the FE 100 coincided with the PSQ9 270-degree line (red) in time and location.
Point B bounced off of the PSQ9 180-degree and registered a BAJA bearish divergence. The pair retraced 38.2%, to form Point C. BAJA SELL to Point C would net 38 pips.
Point C to the FE 100 captured 150 net pips. Point B to the FE 100 = 100 pips.
Looking at the 4-hour, we can see that Point A itself is Swing C in the bigger picture. The just concluded top is the FE 78.6 of this wider plot.
**
The same template as used in EUR/USD can be used for AUD/USD. Note that it will only work when price is above 1.000. We don't have the indicator for USD pairs below 100 or 1.000. We do have both for Yen pairs, which was posted as a template.
USD/JPY 30-min chart shows a Head & Shoulder pattern that started with a BAJA bullish divergence on Apr 26th 22:30.
The other swings:
Left shoulder = Apr 27th 10:00
Head = Apr 27th 16:30
Right Shoulder = Apr 27th 23:00
We also plotted an ABC from the top. Its FE 100 = 81.47. This was at the 405-degree SQ((Price), and just above the PQS9 180-degree (red) line.
We used the HEMA as a histogram and it showed red denoting price action below trend. This occurred when price broke the PSQ9 270-degree line at 18:00.
Therefore, when it pivoted back up 38.2% and above the PSQ9 270-degree, it was still below the HAMA. If you apply the HAMA to the chart, that will be clear. That pullback formed the Right Shoulder.
Since we have to respect data and news, we can attribute the rise in USD/JPY as a temporary reaction to the S&P change in Japan's Outlook to negative.
Then at the top, the pair recovered as the FED rate decision and verbiage was released at 14:30. This downward action was joined by reaction to Bernanke's dovish press conference at 18:15.
Indicator for horizontal squared numbers: SQ 9(Price) Start = 85.51
In honor of "The Wedding", we can name today's trade the "Royal Short"
Attached 30-min EUR/USD utilizes the HAS candles, PSQ9, and divergence indicators.
We have drawn a vertical yellow line at the 11:30 candle period with BAJA bearish divergence. The regular candles were removed but we can toggle back and forth.
The lime color line is the price line graph, and shows close price at peaks and dips (not high/low price). The line graph and RSI(4) moves in tandem and forms almost identical shapes, except when in divergence.
The price label atop is the 15-min entry (1.48587) price and the high pivot price (1.48769) for stop-loss use. Risk, including 5 pips cushion = 23 pips, or 232 mini-pips.
The top was also the 138.2% extension, from plot:
Low = Apr 28th 17:00 1.47715 and High = Apr 29th 00:00 1.48475.
A fib retrace plot from same low to today's high (not shown) has the 50% fib at 1.48324, and just above the PSQ9 90-degree, for net +23 pips .
The 61.8% is 1.48184 (just hit), and coincides with the first plot's 38.2%.
gold new highs
We previously supplied a template for USD/JPY with PSQ9 X4, which is to say it was set to Moon (Planet #1) and applied 4 times at 0, 90, 180, 270-degrees.
On the attached template, we kept that intact, and added:
Mars (planet #4), applied 4 times as above.
The attached pic of the daily chart illustrates the Mars lines as not having as sharp a slope as the Moon. The Mars lines are easy to see and provide good S&R on the daily chart, and the Moon lines easier on 4-hours and lower, for intra-day use.
This template allows user to simply switch back and forth from the daily interval and lower, depending on need. This is for Yen pairs trading under $100.
In the wake of the news, we will show USD/CHF 4-hour chart, with the PSQ9 X 8.
Price hit support from:
1) PSQ9 Mars 270-degree line (bold red line)
2) PSQ9 Moon 270-degree (lime color)
3) The regular 200% extension from plot: High = Nov 2nd .97740 Low = Mar 2nd .93402
The template is also attached for USD pairs below 100 in price. The way to change indicator for above or below is the "number of digits".
4 digits = below 100 or below 1.
5 digits = above 100 or above 1.
For Yen pairs, we need to also make sure input for "multipier" = 0.01
EUR/USD multiplier = 0.0001
Here's the same chart USD/CHF 4-hour. We zoom in on the latest part.
Apr 19th 16:00 period ended as BAJA bearish divergence. That was also just before Point A of the ABCD pattern, and at the wider plot's 138.2% extension.
ABC swings are: Apr 19th 20:00/Apr 21st 12:00/Apr 22nd 00:00 (blue)
Point A hit resistance from the PSQ9 Mars 270-degree line (bold gold color line).
Point B faced support at the PSQ9 Mars 90-degree (bold gold color line) and probed to the Moons 180-degree (diagonal gold color line).
Point C was a 38.2% retrace of A-B, and met resistance at the diagonal PSQ9 moon's 270-degree line (gold).
Point D, the FE 100 = .86380, about same as the regular 200% extension. The PSQ9 Mars 270-degree (bold red color) was there, along with the diagonal PSQ9 moon's 270-degree line (red). The lines can change color, as it was lime on the previous chart.
Andrew's Pitchfork:
Handle = Apr 19th 20:00, same as Point A.
Lower Trend Line = Apr 26th 20:00
Upper Trend Line = Apr 27th 12:00
We can see the Andrew's Pitchfork's center trend line is at the exact location of the extension bottom (Point D) where all meets.
The indicator HEMa Step Histo is a histogram version of the Heiken Ashi Moving Average (HEMa). For the 4-hour chart, we set it at default except MA Period = 6. This is due to 6 X 4 = 24 hours.
We can see that after breaking support around the .88950 area, which is also represented by the bold gold PSQ9 Mars 180-degree line, the histogram bars turned red. It stayed red through the pullbacks and to the extension bottom.
Mouse over the PSQ9 lines to see the degrees.
We can also plot the regular fib retracement tool form A to B, and arrive at the regular 161.8 extension near Point D.
Here is EUR/JPY 4-hour with PSQ9 X 8, which is Moon and Mars each at 0, 90, 180, and 270-degrees.
These degrees are 1/4th intervals of the 360-degree circle that Gann believed in and used in his trading.
This indicator does not repaint, and we can see it shit upwards in the same increment each week. If idle long, or upon just turning on MT4, we have to refresh the chart to keep the lines in proper condition. This can be done by changing to another time-frame and then back.
The Moon setting (planet #1) has a very sharp slope. The Mars lines are more flat.
We can see how nicely the market respects these lines for support and resistance. We also add fibs. For this pair, we have 2 major swings identified on the chart.
The first move down from peak of Apr 10th, also registered a BAJA bearish divergence. It made a 161.8 regular extension to Apr 18th.
That was the low for the move up that became a 138.2% regular extension ending Apr 28th, right at the PSQ9 Moon's 180-degree (diagonal red) and horizontal 61.8% fib (white).
From that top, we can measure a tighter plot of Apr 28th 00:00 high to Apr 28th 12:00 low. We are now at the 138.2% regular extension of 119.842 on the 00:00 candle. The PSQ9 Moon 0-degree is here along with Mars 0-degree.