A-B-C-D Trade - page 211
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This is a descriptive view of what we were looking at and how we arrived at our 06:51 GMT post on EUR/AUD.
We have the same 3 pairs, but reduced the interval to 5-min, as well as place all charts onto session colors. Transition is from Asian (yellow box ) to European (blue box).
Chart of the right is EUR/AUD. As we can see, there was a whipsaw from 01:25 to 01:50. Our original plot used that as its High/Low. "X" marks the Low.
Pair breached Low at 06:25, giving us a heads-up. At the Asian session close, price pulled back up and hit that Low (arrow). This was a 23.6% retrace (red.
Now, look at EUR/USD and how it gapped down at 07:05.
Both EUR/USD and EUR/CHF had been in a very tight range during the Asian session.
EUR/CHF did not break its Asian Low until 07:40. EUR/AUD did it at 07:10.
Traders that held onto the position had the option to tighten stop ahead of the U.S. session. Awareness of session periods can aid trader. The U.S. action proceeded with the beat-down of the Euro.
We comment on XAU_USD, which mimics gold futures. Which do you trade, futures or spot?
thanks for reply
i m spot trader
thanks for replyi m spot trader
You would have to compare the XAU_USD price swings, etc. to charts/data feed you are using.
Generally speaking, the techniques and methodology is the same when applied to commodities such as gold. Gold and oil, however, is prone to more whipsaw action in our opinion.
Right now, and recently, the pullbacks on gold can be large as price are at all-time highs. It represents fear and uncertainty.
***
In Switzerland, there is a law that 40% of the country's money supply must be backed by gold.
This means that gold price will move in the opposite direction of Euro currency pairs, such as USD/CHF and EUR/CHF.
The strength of the CHF is worrisome to the country and they have tried intervention in the forex market, selling CHF. These actions are short-lived.
You, as a gold trader should monitor the CHF as well. If there is reaction to rumors of Swiss intervention, for example, CHF pairs go up and gold goes down.
Attached is a 4-hour chart, XAU_USD is green, and the CHF pairs in red and blue. Aug 5th/8th spike up by XAU_USD was due to S&P downgrade of U.S. The CHF pairs piked down. Often gold can lead CHF.
***
You may extract some techniques here that can be useful (they apply to all instruments traded). But since we don't know your style, we don't know where to start.
Since we featured this pair, let's continue with it. Attached is a 4-hour chart. We applied the Golden Section v3.2 indicator.
We turned ON the pitch fork
Turned ON the right fib channel (and used orange color)
Turned OFF color for arcs colors
Turned OFF color for fan colors
Turned OFF color for spiral color 1 and spiral color 2
Andrew's Pitchfork plot by Golden Section:
Handle = Aug 2nd 00:00 high 1.42609
Upper Corner = Aug 19th 00:00 high 1.38712
Lower Corner = Aug 17th 12:00 low 1.36459
Per previous instructions, insert fib channel tool onto chart, and align with middle and upper fork. This generates fib extensions of channel (white) to the upside.
Attached chart is zoom-in on yesterday's price decline.
The white 161.8% is the same as the orange 0%. This acted as resistance en route down.
The white 100% fib channel line acted as support, until Sept 1st 04:00 period when it dropped to the 61.8% channel level below it. This is the same as the orange -38.2%.
Sept 1st 12:00 candle period saw price dip one more level down to the orange -50%. We thought this would be the same as the white 38.2, but it isn't. We applied .314 (31.4) which is Pi and it is an exact fit.
The aqua blue horizontal fibs were automatically generated by the Golden Section, based on plot between upper and lower corner price. The 12:00 candle closed right on the 261.8.
Currently, per pic, price is at the white 100% channel line.
It's 06:40 ahead of 07:00 European open. Euro declining.
Window is now until 09:00 EU data (PPI), and the Mother of All Data U.S. NFP at 12:30.
Caution with this as the fib channel is there for EUR/USD as support, with 161.8.
EUR/GBP on the move, breaking Asian low of .87956.
High = .88529
138.2 - .87737
161.8 = .87602
08:30 GBP data
09:00 EU data
12:30 NFP
USD/CHF breaks to downside.
Gold (XAU_USD) testing highs
Some positions ducking for cover/safety in CHF. Split-screen of USD/CHF and EUR/CHF, breaking down after tight Asian range..
Here's the gold CFD breaking resistance ahead of NFP. We have aforementioned start price of 1912 for SQ9(Price) indicator.
After next resistance at 1854, next level is 1868
Many banks cut forecast, some cut in half as did Goldman Sachs.
A big bagel for U.S. NFP in August,
XAU_USD at 161.8 extension 1875 based on directional plot, and rising.