EUR/USD 6-13-08
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We did get the 4hr bull pivot in the Eur/Usd off of professional buying but it did not come with the required volume I spoke of in the last insertion. We did However; reach the 50% Fibonacci level to 5477 off the insider buying which again shows the influence of professional buying.
So, once again we see the importance of volume to our trade setups. I did not trade this pivot because the pivot bar formed on lower volume and while this does not mean that price will not continue up but any move on low volume is suspect and thus the risk increases substantially for the setup to fail.
Insiders were buying on the pivot bar but could not get the public to join in on the move. But the public was in on the last 4hr bar which closed down on higher volume than the previous bar. I’m going to wait and see what shakes out because operators like to fade the public. I’m sorry; many traders don’t know the terminology of fading. That just means going the other way against the prevailing direction of the moment.
But understand with all that being said we won’t know if the market has reversed until the close of this current 4hr bar. Even though the bull pivot reversal came on low volume we still must consider that those who took price up in the first place (professionals) still have positions to protect at the low and we won’t know if we have a bear pivot back down until the close of this current bar.
Keep in mind that price is currently in the process of pulling back to test the pivot zone which is the range of bar 1 on the chart. So, let’s summarize the picture of the moment.
What is showing in favor of a downmove…?
The trend is down
Professionals have not yet shown up on this 4hr down turn. They however showed up as sellers on the 1hr at the 50% fib level but not in enough volume to negate the positions they are holding at the bottom
What is showing in favor of a continued move upward?
1. The market is testing the pivot zone which is where price is likely to bounce up from if it going to bounce
2. Professionals still have positions to support in the pivot zone.
3. Even though this bull pivot formed on low volume this downturn has yet to show the higher volume to negate it
If the bulls have low volume up and then the bears test the range with even lower volume down, then the bull have won the battle for volume supremacy. But we won’t know the outcome until the close of this 4hr bar.
So, this is the current picture…I will wait to see the outcome of the current bull/bear battle to see which side has the advantage.
Right now the biggest factor is the trend and the support line at 5440. If we close below 23% Fibonacci the downtrend has kicked back in. As I write this price is currently bouncing up off 23% fib level and we will look for a close above this level on low volume at the close of this bar to keep alive chances for a continued up move from here.
Especially since this fib level is at the support line to form double support of Fibonacci and price support.
Oh, by the way, support 2 has moved up to the last low before this current up swing at 5378.
So, once again we see the importance of volume to our trade setups. I did not trade this pivot because the pivot bar formed on lower volume and while this does not mean that price will not continue up but any move on low volume is suspect and thus the risk increases substantially for the setup to fail.
Insiders were buying on the pivot bar but could not get the public to join in on the move. But the public was in on the last 4hr bar which closed down on higher volume than the previous bar. I’m going to wait and see what shakes out because operators like to fade the public. I’m sorry; many traders don’t know the terminology of fading. That just means going the other way against the prevailing direction of the moment.
But understand with all that being said we won’t know if the market has reversed until the close of this current 4hr bar. Even though the bull pivot reversal came on low volume we still must consider that those who took price up in the first place (professionals) still have positions to protect at the low and we won’t know if we have a bear pivot back down until the close of this current bar.
Keep in mind that price is currently in the process of pulling back to test the pivot zone which is the range of bar 1 on the chart. So, let’s summarize the picture of the moment.
What is showing in favor of a downmove…?
The trend is down
Professionals have not yet shown up on this 4hr down turn. They however showed up as sellers on the 1hr at the 50% fib level but not in enough volume to negate the positions they are holding at the bottom
What is showing in favor of a continued move upward?
1. The market is testing the pivot zone which is where price is likely to bounce up from if it going to bounce
2. Professionals still have positions to support in the pivot zone.
3. Even though this bull pivot formed on low volume this downturn has yet to show the higher volume to negate it
If the bulls have low volume up and then the bears test the range with even lower volume down, then the bull have won the battle for volume supremacy. But we won’t know the outcome until the close of this 4hr bar.
So, this is the current picture…I will wait to see the outcome of the current bull/bear battle to see which side has the advantage.
Right now the biggest factor is the trend and the support line at 5440. If we close below 23% Fibonacci the downtrend has kicked back in. As I write this price is currently bouncing up off 23% fib level and we will look for a close above this level on low volume at the close of this bar to keep alive chances for a continued up move from here.
Especially since this fib level is at the support line to form double support of Fibonacci and price support.
Oh, by the way, support 2 has moved up to the last low before this current up swing at 5378.
But I hope you are starting to get an idea that volume analysis is critical to your long term trading success.
The way I see it at the moment we have a draw in the Euro Usd battle…
Cheers, Jerry
Tradingmajic1@gmail.com
jerry@forextradingmajic.com
The way I see it at the moment we have a draw in the Euro Usd battle…
Cheers, Jerry
Tradingmajic1@gmail.com
jerry@forextradingmajic.com
