A-B-C-D Trade - page 262
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Attached is the follow-up on the same 30-min chart in which our SDC plot is to be assisted by an APF with AML interior fibs.
APF plot:
Handle = Dec 1st 15:00 high 1.02636
Upper corner = Dec 7th 07:00 high 1.02976
Lower corner = Dec 6th 07:00 low 1.01550
Rename APF to AL1, then insert AML_1-1 indicator to get interior fibs.
The handle was originally set at Dec 2nd 13:30 high 1.03243. That was O.K. for the initial hit to the Upper_ML2.
However, after lows seen on Dec 7th 13:00 - 15:30, moving the handle to Dec 1st 15:00 high produced better results fitting those lows to the Upper_ML1.
This was subsequently confirmed by today's 00:30 dip to the Upper_ML1.
To read interior fib labels, simply mouse over those dotted lines.
Since our last post, we had another hit to the SDC upper channel during Dec 7th 20:30 period. Price now testing the APF upper fork and 6/8th MML.
As anticipated, the ECB lowered benchmark interest rate 1/4% at 12:45 GMT. Attached is split-screen 1-hour charts.
The chart on the left utilizes fib channel plot PSQ9 Moon 135 to Moon 45-degree. We can see the support at the FC 31.4 level, which was broken during interest rate announcement.
The chart on the right is a continuance of our SDC plot. As price declined, we can move the fib channel (FC) plot down. Align top FC line to the SDC's lower channel line.
This gives us more expansion levels, and we can see price bounce at the FC 200 during the 15:00 period.
The solid red line is last week's Moon 45-degree. That can also be used as a break line, along with the Mars 270-degree, which it intersected.
There was considerable whipsaw during the 12:00 and 1:00 candle periods, which is another example of our warning to stay on the sidelines, unless you have been trained to trade these events (trade the news).
The 14:00 is one hour and 15 minutes after data release, a safe time to enter if nothing else is exploding on the news front. Therefore this candle is the break candle and can bee seen on both charts.
Horizontal fib plot is the same on both charts. Low = 1.33344 High = 1.34524.
The strong move down pivoted at the 138.2 extension level 1.33023 during 16:00. The bounce up was contained by the 100% (Low of plot) during 17:00, which it very often the outcome.
Note that the market also reacted to ECB comments that bond purchases will not be part of their arsenal in attempt to contain debt crisis. Mr. Draghi also said the ECB will not lend to the IMF. Recently, the IMF agreed to participate in assisting the Euro Zone.
Continuance of our chart using 3 S&R tools. We can see the spike up to the area of the 8/8th MML during the 13:30 period as part of the reaction to today's ECB rate decision and verbiage.
Trading in the same direction as EUR/USD, price plunged. Our Andrew's Pitchfork (APF) plot with AML interior fibs provided good S&R.
Decline paused briefly at the APF mid-fork, before marking a more distinctive pivot at the Lower_ML2 during the 16:30 period. The 1/8th MML right there as well.
To keep the view less cluttered, we did not show the fib channel (FC). As with our numerous examples, when price leaves the SDC, we can use the FC to gain S&R levels in the direction of the move.
We aligned FC to SDC's upper and lower channel. The 16:30 pivot low hit the FC 61.8 precisely.
End of the U.S. session short. Attached is split-screen.
Left is session colors with retrace fib plot. Entry at 50% fib.
Right is 30-min with MML. The entry at the 50% retrace was at the lower fork of a APF plot. You see the upper corner plot point. Where's the plot for the lower corner and handle?
Make sure you see lower fork provide support to confirm APF plot, prior to entry.
This short moved more than 25 pips in one minute, and has found support at the 1/8th MML.
Check your news sources for recaps, as it's been a volatile news day regarding European Zone.
Includes:
Great Britain not agreeing to proposed European treaty change.
EU sends $267 billion to IMF for rescue funds.
New fiscal rules implemented in Euro Zone.
Market trading with news during Asian session. Will have European session reactions soon. So far, market not impressed as seen by lack of Euro rise.
Here's the APF plot parameters on the 30-min chart:
Handle = Dec 2nd 16:00 low 1.33621
Upper corner = Dec 7th 07:00 high 1.34524
Lower corner = Dec 6th 07:30 low 1.33344
We said that the fib channel was aligned to the upper and lower forks, to get expansion fib levels.
Currently, price testing 1.3300 level and yesterday's low 1.32878.
EUR/USD failed to break support end Asian, only probing 7 pips below Dec 8th low of 1.32878.
Rumored China debt involvement provided some market with accelerant to the upside.
Chart on left is 15-min session colors, with retracement fib plot. Price topped out at the 78.6% fib during 11:00 period. The top is also the 161.8 based on plot using Asian high/low. The 8/8th MML right there as well.
Chart on the right is the same 30-min with APF. The top was a precise hit to the middle fork. Along with the MML, the APF with aligned fib channel provided good S&R.
Price currently at the lower fork, which is acting as resistance.
One of the keys of the day was to be wary of the change into the European session, which we have emphasized before.
Volatility spikes up one hour prior to the European open, which is 07:00/08:00 GMT. (This changes with daylight savings time).
14:55 positive University of Michigan Confidence became minor event, overshadowed by European headline news.
SDC plot is Dec 5th 17:00 and Dec 8th 13:00. These were 2 obvious highs.
Yesterday's (Dec 8th) plunge is easily seen, with breach of lower SDC lower channel. Price reversed at the FC 161.8, which was intersected by the Moon 270-degree.
Price now in ascent again after data, attempting to penetrate F 31.4 (and Mars 225-degree) and get back up to the SDC lower channel, which would be the next resistance.
This area also the 61.8 retrace fib, using 12/8 high and 12/9 low.
Attached is a split-screen of EUR/USD daily. We used this version of the SQ9 indicator: SQ9 (Price) 22.5 Factor 56.
Often the other version SQ9(Price) cannot extend far enough. These 2 indicator versions allow us to fix the start point to our desired price. The 3rd version is Gann_SQ9, which automatically adjusts.
The chart on the left analyzes the move down from the Aug 29th 1.45472 high. We marked pivot points at the 90 and 180-degree levels, with the 180 being a larger pullback..
We marked this pullback to the 113-degree level as a 38.2% fib retracement. The extension to the bottom was 127.2%, same as the 225-degree level, probing slightly lower.
The chart on the right is the next move, up from the Oct 4th low of 1.31443. Price pivoted at both the 90 and 135-degree levels, with the 135 being the larger pullback.
The pullback hit the 90-degree. Candle price closed at the 23.6% fib.
EUR/USD proceeded to make a 138.2% extension, which is also the 180-degree.
****
You can make the plot for the next move down from the Oct 27th high of 1.42464. Indicator can be found in the Gann Is The Mann Thread, post #10.
You will see 3 pivots. Using your fib tool, the outcome is the bottom, in all 3 cases, will be one of the 3 extension fibs of 127.2, 138.2, 161.8. They will also align with a major SQ9 level.
The attached is a 15-min chart with session colors. We focus on the yellow Asian session box, and the breakout to the upside during Friday Dec 9th.
Asian session used was 00:00 through 07:59 GMT. Using your fib expansion tool, plot the ABC swings (red):
A = 07:15 Low 1.32805
B = 09:15 High 1.33463
C = 09:30 Low 1.33254
The indicator MurreyMath1.0 is also applied onto chart.
The 6/8th was respected as resistance at the establishment of the Asian High and just prior to the subsequent breakout.
The breakout candle was the 10:45, and price made an extension to the FE 161.8 during the 11:00 period. The 8/8th MML was also there near that top. Gain from breakout was about 60 pips.
As previously mentioned, a fib plot using the Asian high/low produced a 161.8 (blue) at the same level as the 8/8th MML. Our 30-min plot with the APF, had its middle fork at the top.
The breakout of the Asian high/Low is covered at the beginning of this thread.
Some traders short off the 161.8 top. Major exit point would be back at the Asian High. More conservative levels can be measured with a fib retracement plot, or alternatively, use of the FE levels.