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Daily GBP/JPY analysis

  • #4,921
  • May 27, 2007 6:52am May 27, 2007 6:52am
Quoting sami772
hi yezbick
Thank you very much
It is very good indicators,
What is the favorite time do you like to use with them?
Do you do long scalping or short scalping?
What is the stop lose and take profited depend on?
Do you use it for eur/usd and euro/jpy gbp/usd??
1. Favorite Timeframe depends on the situation. Under general movement I like the M30 and higher. After a piece of news I will watch the M1 and sometimes even the ticker chart, but M1 is good.

2. I prefer long scalping as it tends take less of my time. After news or solid rumor I will do some short scalping.

3. I generally don't use SL's and prefer to use hedging as protection against the rare negative move. As for take profit, I let the market dictate it. I will let my trade run as long as the market allows and the news supports my current position.

4. I have used these pairs in the past, but have not done so well when I diversified in multiple pairs. So I married myself the to the GBPJPY until I understand why it moves the way it does. Basically want to know this pair like the back of my hand. I won't say I understand it completely, but I do understand it very well do to some help from others on this thread like Cesnarnc and others.
  • #4,922
  • May 27, 2007 7:20am May 27, 2007 7:20am
Quoting treadline
http://articles.moneycentral.msn.com...bak.aspx?msn=1

he is saying the china's gov might not do anything to their stock market till the end of the 2008 olympics. thats the like august of next year. might think about the g/y going up till then. and after that it may crash to hell. beware of the bubble to burst.
Very nice article, thanks.

It looks like there are very nice technical analysis to indicate a bubble in a market. But, although those indicators could fit markets and economies like German, American, British, it is somehow interesting to imagine if a market/economy like China's would follow the same principles.

So Shanghai may not be in that scary bubble everybody talk about because it is just different.

Why would China be different? China is ALREADY different. Its economy is played by different rules (politics, taxes, exchange rate policies, labor rights, environmental concerns, piracy, so forth).

We have a technical bubble, yes. No one can tell how much more can go in, no sir.

This last week we saw the world talking about the Chinese bubble and Shanghai was compulsively closing in the green area (!!!!). I mean, if you had your money there I'm sure you would take it out as fast as possible after the talks. That is not what happened.

Let's run a scenario for the long run

- China does not crash in 2007. Corrections, shakeouts, probably, but not that -5% a day kind of crash.

- UK raises rate again and CPI keep coming 2.5-3.0% Dollar fails its recovery and goes back down again - GBPUSD goes to 2.0200. Not a bold call, right? Just 70 pips above last top.

- Japan keeps rate as is for the year. Yen goes to 125 piggybacked on the increasingly attractive carry trades (Euro to raise rates, too) . Don't see it as a crazy call either.

GBPJPY = 2.0200 x 125.00 = 252.50.

Even if those 2 prices don't happen at the same time, we are still talking about several hundreds of pips yet.

So, in that sense, 241 may look like "absolute top" for many people here but if Cable just goes on trading its long term trend and Yen continues a cheap product, GBPJPY 1,000 pips higher is NOT a product of a deteriorated mind.
  • #4,923
  • May 27, 2007 10:23am May 27, 2007 10:23am
hi Yezbick,

I am trying to figure out to use the fibonacci for my entry and exit indication. Can you share with us, what time frame (1H or 4H or 1D) of this pair (GBP/JPY) works better with fabonacci?

Thanks.

BTW, thanks for your posting of your EAs on page 327.

Trader8686
  • #4,924
  • Edited 1:47pm May 27, 2007 12:20pm | Edited 1:47pm
One of the main factors in any equity bull market is liquidity-the availability of cheap money and investors willingness to use it.

Interest rates obviously play a crucial role in this, but it's more complicated then just raising rates and waiting for a slowdown. Investors want a safe investment at the highest rate they can get, but if gov't bonds pay 6% and you can get 80% return in stocks-that's where the money will go.

Chinese markets have A shares and B shares. A's are up almost 60% and B's nearly 80% for the year, so if gov't bonds are raised from 6 to 6.5%, it's not likely to slow equity investment.

All these corporate profits create liquidity too and China is swiming in it now.

That being said, a "pop" in the bubble is very possible, but what's also very likely is that just as in February, the pop will be "repaired" because liquidity will remain in the market and participants will seize the bargains.

The overall trend for world growth is very positive according to every major economist from the IMF and OECD to the Central Bankers of the G7.

Still I would put the chances of seeing a "pop" as being pretty good. Wouldn't you like to be able to buy GBP/JPY 1000-1500 pips cheaper then it is now? So would everyone else.
  • #4,925
  • May 27, 2007 1:09pm May 27, 2007 1:09pm
Quoting NewstraderFX

Still I would put the chances of seeing a "pop" as being pretty good. Wouldn't you like to be able to buy GBP/JPY 1000-1500 pips cheaper then it is now? So would everyone else.
My opinion is 100% opposite of my best interest. I don't think China is exploding tomorrow. Although I could make a damn fortune should we have China exploding every month like February...
  • #4,926
  • May 27, 2007 1:53pm May 27, 2007 1:53pm
Quoting cesarnc
My opinion is 100% opposite of my best interest. I don't think China is exploding tomorrow. Although I could make a damn fortune should we have China exploding every month like February...
So could you, me and everyone else-which is one factor for arguing that a "pop" is all the more likely.

Aside from our own self-interest, there are some pretty experienced economic minds that are indicating this is likely to happen. Whether it's tomorrow, next week or whenever-keep a good amount of money in your account and stay alert.
  • #4,927
  • May 27, 2007 3:51pm May 27, 2007 3:51pm
Thanks very much for your answer
almost I use same strategy that u use ..
but for sl I use fib , I normally look for reverse at 1.62% or 0.62% to take my profit and renter again after going back to next fib line,
I do like trading GJ very much , but in same time I use SRDC I method for eur/jpy , and I can take every day 18 pips 70% accurate and I put my SL from 25 to 30 pips
also I close all my position before the news in 15 mints , and trade the news almost like your way ,
again thanks for your information very much,


Quoting yezbick
1. Favorite Timeframe depends on the situation. Under general movement I like the M30 and higher. After a piece of news I will watch the M1 and sometimes even the ticker chart, but M1 is good.

2. I prefer long scalping as it tends take less of my time. After news or solid rumor I will do some short scalping.

3. I generally don't use SL's and prefer to use hedging as protection against the rare negative move. As for take profit, I let the market dictate it. I will let my trade run as long as the market allows and the news supports my current position.

4. I have used these pairs in the past, but have not done so well when I diversified in multiple pairs. So I married myself the to the GBPJPY until I understand why it moves the way it does. Basically want to know this pair like the back of my hand. I won't say I understand it completely, but I do understand it very well do to some help from others on this thread like Cesnarnc and others.
....
  • #4,928
  • May 27, 2007 6:22pm May 27, 2007 6:22pm
Quoting sami772
Thanks very much for your answer
almost I use same strategy that u use ..
but for sl I use fib , I normally look for reverse at 1.62% or 0.62% to take my profit and renter again after going back to next fib line,
I do like trading GJ very much , but in same time I use SRDC I method for eur/jpy , and I can take every day 18 pips 70% accurate and I put my SL from 25 to 30 pips
also I close all my position before the news in 15 mints , and trade the news almost like your way ,
again thanks for your information very much,
Hi sami772,

As I am a position trader, not a daytrader. I hold positions days or longer.
I also like to trader on fibonacci retracement/extension, and I just start to find out on this.
Can you share with me on what time frame of this pair is best working with the fib?
  • #4,929
  • May 27, 2007 6:28pm May 27, 2007 6:28pm
Quoting trader8686
hi Yezbick,

I am trying to figure out to use the fibonacci for my entry and exit indication. Can you share with us, what time frame (1H or 4H or 1D) of this pair (GBP/JPY) works better with fabonacci?

Thanks.

BTW, thanks for your posting of your EAs on page 327.

Trader8686
I find that I use fibs on all timeframes. Out of the ones you mentioned H1 has been the most useful.

If your interested in learning more about using fibs. I've found the following to be of great help.

Inserted Video


I have enclosed an indicator for calculating fibs. I have found it to be very useful as well.

Fib Indicator that may be helpful.
Attached File(s)
File Type: ex4 FiboRetracement3.ex4   17 KB | 353 downloads
File Type: mq4 FiboRetracement3.mq4   16 KB | 386 downloads
  • #4,930
  • May 27, 2007 6:43pm May 27, 2007 6:43pm
Quoting yezbick
I find that I use fibs on all timeframes. Out of the ones you mentioned H1 has been the most useful.

If your interested in learning more about using fibs. I've found the following to be of great help.

http://www.youtube.com/watch?v=R6ft90FLI-I

I have enclosed an indicator for calculating fibs. I have found it to be very useful as well.

Fib Indicator that may be helpful.
Yezbick, Thanks One Million!
  • #4,931
  • May 27, 2007 7:28pm May 27, 2007 7:28pm
Yezbick,

I have attached the file : FiboRetracement3. ex4 to my chart.
I am a little confused of what I saw: market is uptrend, therefore I took high from 05/23 241.84 and low from 05/25 at 239.65 as the retracement area. And that is the yellow dot line in this EA drawed.

Am I right, yellow dot line is the retracement area? Just need a confirmation.


Trader8686
  • #4,932
  • Edited 8:34pm May 27, 2007 8:21pm | Edited 8:34pm
Quoting trader8686
Yezbick,

I have attached the file : FiboRetracement3. ex4 to my chart.
I am a little confused of what I saw: market is uptrend, therefore I took high from 05/23 241.84 and low from 05/25 at 239.65 as the retracement area. And that is the yellow dot line in this EA drawed.

Am I right, yellow dot line is the retracement area? Just need a confirmation.


Trader8686
Looking at the H1 and H4 the yellow line your talking about is the retracement area. Currently we are coming out of a retracement from last Fridays move.

From my understanding of Fibs. We are looking at the possibility of the 132.8 which should be around 242.64

Waiting to see what the news brings us this week. Could see the moon as some have pointed out and the swoons in june could come just as well.
Attached Image
  • #4,933
  • May 27, 2007 8:21pm May 27, 2007 8:21pm
Hehe,it seems that we cannot escape of the armaghedon fear. Interesting is this market sentiment, and probably many other traders have the same fears like us, so this can become a self-fulfilling prophecy soon.

Here are some dailyfx articles sustaining the coming fall on the technical side for UY. I still dont believe in them, they have been announcing "another leg down" since GBP/JPY went up to 235, so... they might be right when GY will reach 250

http://www.dailyfx.com/story/bio2/Ye...087988853.html

http://www.dailyfx.com/story/tophead...104540647.html
We leave no soldier behind.
  • #4,934
  • May 27, 2007 8:43pm May 27, 2007 8:43pm
Quoting gagiul
Hehe,it seems that we cannot escape of the armaghedon fear. Interesting is this market sentiment, and probably many other traders have the same fears like us, so this can become a self-fulfilling prophecy soon.
While the armaggedon prophets are in the grossery store, buiding their inventories for the nasty days to come, Shanghai's investors go on flowing the cash in.

Shanghai SSE Composite and A-shares above +1% at open.

The world is going to survive this Monday to die another day

Nice week you all.
  • #4,935
  • May 27, 2007 8:46pm May 27, 2007 8:46pm
Quoting yezbick
Looking at the H1 and H4 the yellow line your talking about is the retracement area. Currently we are coming out of a retracement from last Fridays move.

From my understanding of Fibs. We are looking at the possibility of the 132.8 which should be around 242.64

Waiting to see what the news brings us this week. Could see the moon as some have pointed out and the swoons in june could come just as well.
OK, now I honest don't see the 132.8 on my chart with FibRetracement 3 EA attached.
How do I find it?
  • #4,936
  • May 28, 2007 12:29am May 28, 2007 12:29am
Quoting trader8686
OK, now I honest don't see the 132.8 on my chart with FibRetracement 3 EA attached.
How do I find it?

In order to see the 138.2 you will need to do a manual fib placement and then move back to see it. Like this. You will also need to change your time frame to D1 as well.

You can barely see it on top. I've highlighted it in purple to show its location.
Attached Image
  • #4,937
  • May 28, 2007 5:31am May 28, 2007 5:31am
Quoting yezbick
In order to see the 138.2 you will need to do a manual fib placement and then move back to see it. Like this. You will also need to change your time frame to D1 as well.

You can barely see it on top. I've highlighted it in purple to show its location.
Looks like your chart is MT4, too, but
my fib numbers are invisible, too light.
How do you make it yellow and highlight it pink?
  • #4,938
  • Edited 6:44am May 28, 2007 6:27am | Edited 6:44am
Quoting trader8686
Looks like your chart is MT4, too, but
my fib numbers are invisible, too light.
How do you make it yellow and highlight it pink?
I added the fib and pink line manually using an ibfx tool.
  • #4,939
  • May 28, 2007 7:55am May 28, 2007 7:55am
Cesarnc, no offence to you on my previous post.
Talking about chinese market, i guess i have a little bit more expertise than your guys here---I am a chinese, and i traded shanghai and shenzheng share since 2004 at the time that i was in the university.
Yeah, Chinese is different. because it has complete different Economic fundmental, structures. what happens in chinese stock market now is result of loss and tight monery policy from US and Western. If anyone familiar with the bubble Crisis in JPY on 90s, you would not suprise why Chinese governement still resist from Western Pressure over RENMINBI appreciation. And it can't afford to do that.( japanese economy suffered since then, and still suffering)
So when Western government argue about trade deficit, there are many things they "igored" or "probably dont want" talk about. Trading Settlement currency--- the underlying primary key of finance influence. USD and EUR are the two major settlement currency. I think European governments notice this key point far early, that is why, we having Euro zone now. And Euro actually help to resist US exploitation over European country.
Why Exploitation? Because each dollor goes into chinese or Japanese central bank from the Trade deficit, they have to product a relative amount of RENMINGBI or YEN for clearance. This is really painful, because those central banks have to deal with those over-crowd montery supply. Therefore, we never really seen COB or JOB raised their interest rate over 3.75 in last 15 years. and their citizen cant earn much over their saving, because in those two country, individual saving rate is far below even the standard interest rate, not mention about catching inflation! This is one of the drive why Chinese stock market is so crowd right now. and they lack of alternative investment scheme.
Alan Greenspan talked about "inrational prosperity" since 1996, and he pointed out bubbles in US Stock market that time.... and he did some damage to bubbbling US market. However, the bubble did not go away until 2001.
If we ask whether chinese market have bubble, i guess 99% of people would say "yes". But whether is gonna bomb off? may be retracement, but difinitely no bomb off in next 2-3 years, even the average price earning ratio is about 40 (and chinese coporation efficiency is low, not even mention to their earning---Coporate investment helpd their earning climb up a lot as the whole index doubled up in 2006)
How Chinese Governement is looking at? from Alan Greenspan's experience, they are not gonna to stab the bubble right now. they are planning on taxing short term capital gain, Stoping loan money goes into stock market. they gonna widen currency trading range---that means more risk for hedge fund to take advantage on RENMINGBI.
JOB is doing the same thing. (check the 10 year)IN fact,in last 6 year since 2001 crisis, Japan is acting as the ATM of global financial market. many hedge fund borrow money from japan and invest in somewhere else. In the Jan, they took a step towards "Interest rate" 0.25, How long had they been in Zero interest rate??? years. Even JPY is an free exchange currency, Japnese treasury is one of strongest manipulation force over exchange rate....(I Guess everyone knew about that) and i believe, it is also a drive behind Feb retrace.

Back to JPY, Cesarnc, I refering 241 as the top. because in long term, i smelled the change-retrace range will getting wider and more frequently; long term climb may no longer follow previous pattern....
and again 241 may not bethe top, but be-aware about dramatic changes


Quoting cesarnc
Very nice article, thanks.

It looks like there are very nice technical analysis to indicate a bubble in a market. But, although those indicators could fit markets and economies like German, American, British, it is somehow interesting to imagine if a market/economy like China's would follow the same principles.

So Shanghai may not be in that scary bubble everybody talk about because it is just different.

Why would China be different? China is ALREADY different. Its economy is played by different rules (politics, taxes, exchange rate policies, labor rights, environmental concerns, piracy, so forth).

We have a technical bubble, yes. No one can tell how much more can go in, no sir.

This last week we saw the world talking about the Chinese bubble and Shanghai was compulsively closing in the green area (!!!!). I mean, if you had your money there I'm sure you would take it out as fast as possible after the talks. That is not what happened.

Let's run a scenario for the long run

- China does not crash in 2007. Corrections, shakeouts, probably, but not that -5% a day kind of crash.

- UK raises rate again and CPI keep coming 2.5-3.0% Dollar fails its recovery and goes back down again - GBPUSD goes to 2.0200. Not a bold call, right? Just 70 pips above last top.

- Japan keeps rate as is for the year. Yen goes to 125 piggybacked on the increasingly attractive carry trades (Euro to raise rates, too) . Don't see it as a crazy call either.

GBPJPY = 2.0200 x 125.00 = 252.50.

Even if those 2 prices don't happen at the same time, we are still talking about several hundreds of pips yet.

So, in that sense, 241 may look like "absolute top" for many people here but if Cable just goes on trading its long term trend and Yen continues a cheap product, GBPJPY 1,000 pips higher is NOT a product of a deteriorated mind.
  • #4,940
  • May 28, 2007 8:34am May 28, 2007 8:34am
Quoting winwise
Cesarnc, no offence to you on my previous post.


Back to JPY, Cesarnc, I refering 241 as the top. because in long term, i smelled the change-retrace range will getting wider and more frequently; long term climb may no longer follow previous pattern....
and again 241 may not bethe top, but be-aware about dramatic changes
- Not taken at all..

- I don't work with 241 toppish right now. GJ and other carry trades are pushed by risk perception and even with this China-Monster-Bubble to go off, Shanghai is painted in green. Last session +2% overall indexes. So the Chinese investors themselves, who would be supposed to get out of the market on those talks are not doing that.

Few more green sessions in Shanghai and Dow Jones above 13,600 last resistance and risk apetite is much more likely to resume than risk aversion to increase.

However, I don't say that GJ is going 1,000 pips straight shot. It is going to be a bumpy ride for sure, specially when the yen weakness theme gets back to the arena when (if) USDJPY pushes though 122.00 mark. To note 122.30 is ±5 years high. Poor 70 pips from actual price.

I just don't get afraid of "multi-year" levels coming up, which seems to be the main driver of the fears among the FF comunity.
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