A-B-C-D Trade - page 84
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EUR/CHF now trending down, as flight-to-safety taking hold.
EUR/CHF thus would dragg down EUR/USD, which now testing bottom channel line and price now 1.3291.
09:00 German data (IFO - Business confidence) was high and causing some regain on EUR/USD, at least for the moment. At 1.3307 now.
EUR/JPY shrugs off German IFO after initial spike to 111.91, retracing to session low.
USD/JPY breached pivot of 83.79, but support at Dec 15th low 83.64 may cap any gains to downside.
EUR/USD upper channel line contains reaction to German IFO, At 09:15, a 1-pip body doji formed indicating possible reversal.
EUR/CHF stalled at support of 1.2762
EUR/USD testing support of 1.3293
At 67.5-degree of 67. Took half position here.
We also see 3 fibs in area of 70
Based on this pivot at 1.3267 (with high at 1.3317), we have extensions at:
138.2 = 1.3249
161.8 = 1.3236
Asian (and today's low thus far0 is 1.3233.
That's it for us, out.
EUR/USD and EUR/JPY sold off to the downside in dramatic fashion during the European session.
Initially the German IFO data provided an uptick as bulls took the pairs beyond the Asian high during the 10:00 hour.
We drew a trend line for EUR/USD which was broken at 11:30. That particular 15-min candle closed at 1.3293 which was a support area during Asian and early European.
Using the previous day's U.S. session low of 1.3185 and the Asian High of 1.3326 provided fibs. Together with the Gann_SQ9 support levels, we had a nice idea of where to take conservative profits.
After some consolidation at the 50% fib area, pair broke through Asian Low of 1.3233 during 14:00 candle, shortly after U.S. traders joined the foray.
An ABC plot at breakout had swings at 11:30/12:15/13:00 (15-min chart), with the FE 161.8 price of 1.3149 reached at 15:30.
***
At the top for EUR/USD, we measured a retrace from 05:45 low 1.3278 and Asian High 06:30 1.3326. The 161.8 was 1.3356, which was an opportunity to short, or at least identify a top.
Looking at the recently introduced indicator (by us) Fisher_Yur4ik, we saw a diminishing green "hump" on the histogram as the uptick ran out of steam. The 15-min candle also was small, including the 2-pip body.
The first red histogram bar closed with the 10:30 candle period. The next 10:45 candle dip back below the Asian High and bounced of the diagonal trend line.
In the end, the pair made a 138.2 retrace form the master plot. Total downside gain was about 225 pips.
****
The Gann_SQ9 indicator made a slight adjustment as pair descended. 67.5-degree became 1.3272, 90-degree = 1.3244. Final destination area neared the 180-degree level of 1.3129. 180 is half of 360, which is significant within the Gann methodology.
****
EUR/JPY traded in tandem direction and proportion. USD/JPY pulled in both direction, but moved opposite of EURO pairs after 10:00, before retracing in a strong manner at 18:00.
USD/CHF gained about 160 pips off Asian lows, with the only major pullback occurring around 12:00.
EUR/CHF had an extra uptick at 11:15 (pulled by USD/CHF) but managed to decouple and come down for a more modest 67-pip gain. Therefore, this pair was an example of being pulled in both directions.
There was some divergence noticeable with the Fisher, which produced a SELL signal at the open price of the 11:30 candle 1.2779.
S/L just above high of 1.2793 + 4 pips = 1.2797. If trade exited after opposite colored histogram closed at 1.2742 (13:30 close), profit = 33 net pips. Risk/reward = 18/33 almost 1:2.
Alternative exit strategy would have been to switch to the 5-min and take the opposite colored histogram bar close at 13:30 close of 1.2733.
Although this pair did not profit nearly as much as the EUR/USD or EUR/JPY in number of pips, proper scaling based on a near double reward to risk ratio would have produced a decent return.
***
Note the Gann Box next vertical pivot line for Dec 17th 20:00 is of course the end of the week
Let's also remember to watch for any development of a Sunday Reversal Candle.