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  • #101
  • May 20, 2008 8:22pm May 20, 2008 8:22pm
Thanks for correcting me. I must be having a senior moment. I know the correct terminology but have been looking at the wrong spelling since posting and it did not even register. Old age, bad eyes.
  • #102
  • May 20, 2008 8:34pm May 20, 2008 8:34pm
Take a look at this. Now that I have showed you how I calculate value areas manually I want to introduce this tool that I use most of the time. I will explain it more as time goes on. Too tired right now.

Basically, it uses current monthly distribution data and previous monthly data to project where the current months value levels and objectives may lie. Remember this is a monthly distribution, so think of the levels as areas instead of specific targets. Sometimes they are right on however, sometimes not. You can see that the calcs almost hit the exact bottom this month. Generally, this is just a way to project where we may head.

ADV = Adaptive Dynamic Value.

I am expecting the EURUSD to make it up 5717 and build value on either side. If we build value and move up above ADV this is bullish and I would currently expect an objective of possibly 1.6074. Of course, this will likely change as we move forward. I will be posting this from now on, it is easier for me.

http://www.morrisfunds.com/storage/f...05.21.2008.PNG
  • #103
  • May 20, 2008 9:35pm May 20, 2008 9:35pm
thanks drt on the jpy call, looks like102 is the mark, down to 103.22
  • #104
  • May 20, 2008 9:42pm May 20, 2008 9:42pm
Quoting DownRiverTrader
Thanks for correcting me. I must be having a senior moment. I know the correct terminology but have been looking at the wrong spelling since posting and it did not even register. Old age, bad eyes.

I am sorry, I am feeling bad. I know it was typo so I just wanted to correct it. Anyway, thanks for explaning the chart. Its was very helpful.
  • #105
  • May 21, 2008 4:04am May 21, 2008 4:04am
Drt,
We reached the 15736 level, looking for a small pull back and a move up. with a move to value area +1. What is your outlook for the rest of the month ? I have this feeling that it won't make it to 1.6 not this month. I know that I should not trade on feelings but something is just nagging at me about this height.
  • #106
  • May 21, 2008 4:23am May 21, 2008 4:23am
Okay, so we have moved above the ADV level at 5717. Nothing wrong with taking profits here and waiting. The next directional move will come out of this level.

Watch to see where we build value. Above or below this level. If we hold above this level, this is bullish. If the price area above this level is rejected and we move back below, there is a good chance that we will move back dow to 5566. This will become the new curve heading into the end of the month.

Another scenario is that we hold this level and move up to 5820. (I am hoping for this one). I will take profits on a push into this level and watch what happens. Then we may work the 5820 down to 5717 area where we would want to set up longs again.

Let just observe for a while.
  • #107
  • May 21, 2008 4:55am May 21, 2008 4:55am
Quoting DownRiverTrader
To me this junction is where the money is made or lost. It was logical to assume a move up for the month. Now it is difficult to hold long. The logical brain says ... "we are up 160 points on the day, there is no way I should hold on and ask for more from mother market".

I do not think we have seen the top of the next range extension yet. Maybe we have, but I think it will come closer to 1.5829. This is another 150 points higher or so. Many weak holders will exit expecting the Asian session to retrace. My bet is 1.5635 will hold the downside into the coming sessions.

In any case, once we find a new curve to work, we can make some decisions. Any close in the NA session above 1.5694 would be very bullish, but it looks like it will be hard to get there at this point.

I am hesitant to say this for fear of being called a bigger quack than I am, but I follow synodic cycles very closely. Today there was a full moon and while you may think it foolish, that is why we had a move. Always shakes the market. The key is to watch for a continuation or all out reversal at these cycles. If we continue up, then longs into the next cycle are favored by me. Many times these cycles provide an all out reversal of sentiment. You could say that the Euro has been headed down recently, but has the current synodic cycle reversed this as the moon is at it's farthest distance from the Earth and pulling on our emotions with great force. Time will tell. Look out your window and you can trade reliably. Don't you find it interesting that all the big moves occurred on May 20 so far. Oil, Gold, Euro, SP. ITS THE MOON of course.

Usually at this point, I am anxious to lock in a nice profit. I think I have around 350 pints of profit in this trade. Like I said, now is the stage where money is really made or given back. It is tough. Here's what I do.

I ask myself over and over. Is there any reason I should exit? Or put another way, why am I still long.

 

  1. The market is up 87 points.
  2. We are trading above the ADV value.
  3. Price is currently stable above the ADV
  4. The GernanIFO report was good.
  5. ECB is hawkish on inflation. Not lowering rates.
  6. I do not see any large selling yet.
  7. Sentiment carries through to Friday's usually.
  8. We are making new monthly highs.
  9. The next daily high on the chart is 5895.
  10. etc., etc. etc.

So I stay long until I have a reason to exit. It could occur within the next hour, but for now I remain long looking for 5820/35.

  • #108
  • May 21, 2008 8:39am May 21, 2008 8:39am
Following up into the NA Equities Open

The market has attempted to extend value through the ADV zone at 1.5717. You can see that we are beginning to build value above this area, but it is too early to be sure if price will remain above. At this point, I assume that we will begin an upward track to develop the area from 5717 to 5820. I will continue this view until I am proven wrong. I will know this if the market moves back below 5717 and build value there.

It is very possible (likely) that this area will not hold and we will move back down. However, unitl that scenario develops I will remain bullish.

I am holding longs to 5820 at this point. If I wanted to establish longs or add to existing longs, I would do it at the 5717 area or just below. This is a very favorable risk reward area for the next directional move up if it occurs.

Remember, these are areas on a monthly chart. Give them some flexibility. The important part is where price remains or settes.


http://www.morrisfunds.com/storage/f...21-.2008-1.PNG
  • #109
  • Edited 9:31am May 21, 2008 9:09am | Edited 9:31am
USDJPY Price Distribution

Seems there are a few interested in the JPY.

Unfortunately this chart is posted a little late for those looking for a new entry level. The market gave an entry long on 5/12 and is currently attempting to move back towards the 104.39 level. I would be on the sidelines on this pair right now if just looking at it or long out of the ADV level of 102.79.

I will start posting this on a regular basis also for the YEN traders. Sorry.


http://www.morrisfunds.com/storage/f...05.21.2008.PNG
  • #110
  • May 21, 2008 9:17am May 21, 2008 9:17am
Sterling is at a favorable value for decision making.

I am looking to set longs or shorts to the next level. I would favor longs up towards ADV but it could go either way.

Longs would enter around 9627 and target 9732.

Shorts would enter at 9627 for a move back down to 9508.

http://www.morrisfunds.com/storage/f...05.21.2008.PNG
  • #111
  • May 21, 2008 9:17am May 21, 2008 9:17am
Quoting DownRiverTrader
USDJPY Price Distribution

Seems there are a few interested in the JPY.




http://www.morrisfunds.com/storage/f...05.21.2008.PNG
Could you please add your comments? There are people in both long and short camps.
Expected the unexpected
  • #112
  • May 21, 2008 9:19am May 21, 2008 9:19am
If anyone has another pair that they follow closely let me know, I will take a look and post the distribution so you can work on logic behind the value levels.
  • #113
  • May 21, 2008 9:32am May 21, 2008 9:32am
Quoting scyang
Could you please add your comments? There are people in both long and short camps.
Sorry about that. I added some comments above. Will start to keep up with this for you. What time frame charts do you follow???
  • #114
  • May 21, 2008 9:43am May 21, 2008 9:43am
For anyone who wants to chirp in....

What time frame charts do you use? Are the monthly charts to broad for your risk tolerances? Would you get more out of this if I narrowed the focus?
  • #115
  • May 21, 2008 11:55am May 21, 2008 11:55am
Just to chirp in, a view of the weekly would be nice. I know you also did the hourly and daily but I get a better sense from the monthly that you post. The other pair that I follow is the swiss franc. If you could post a chart on that it would be much appriecated. Thanks
  • #116
  • May 21, 2008 5:21pm May 21, 2008 5:21pm
As you can see the Euro is building value above the ADV level of 1.5717 and is just a few points under the target area of 5820. This is the area we identified as a target early in the month and my long trade is up around 450 points.

Building value above ADV is a bullish sign and should give us some confidence in trading this zone. The next major directional move will come from the 5717 level. If it does not hold we could move down 5566 next.

I continue to hold my longs and am looking for price to test the 5820 area or above. If prices does in fact move up, I will hold here until this level fails. If price does not hold, I will take profit and stand aside and observe before setting up any short trades.

If price moves back down first, I will hold longs until the demand at the ADV level of 5717 gives way. If the market gives this level, traders can look to set new longs here and target 5820.



http://www.morrisfunds.com/storage/f...05.22.2008.PNG

  • #117
  • May 21, 2008 6:08pm May 21, 2008 6:08pm
The USDJPY is once again approaching the key ADV level of 102.79. The plan here is remain bullish until proven wrong. Traders can look to establish longs at this level and target a move back up to supply at 103.80 and then onto 104.39. If the ADV level does not hold and price builds value below, traders can look to set up shorts for an extension lower down to the 101.75 level. I would cover at this level and observe price behavior before setting longs back up to ADV.


http://www.morrisfunds.com/storage/JPY%205.22.2008.PNG

  • #118
  • May 21, 2008 6:11pm May 21, 2008 6:11pm
Quoting DownRiverTrader
Sterling is at a favorable value for decision making.

I am looking to set longs or shorts to the next level. I would favor longs up towards ADV but it could go either way.

Longs would enter around 9627 and target 9732.

Shorts would enter at 9627 for a move back down to 9508.

http://www.morrisfunds.com/storage/f...05.21.2008.PNG

This one worked out nicely today. Hope somebody got it.
  • #119
  • May 21, 2008 6:27pm May 21, 2008 6:27pm
The sterling trade worked out great today as we set longs at 9627 for a move to 9732 as we are moving toward ADV. Traders should have covered at this level for a 100 point gain.

The next move is a little more difficult to predict. We know now that we will either move up from 9732 to ADV or move back down to balance the area below 9732. If you look closely, you will see an unbalanced area just below this level.

If we move above 9732 area and build value here, look for an opportunity to set up longs for a move on up to ADV at 9837. I would cover here and wait.
If price moves down from 9732, the ledge down at 9665/90 may hold it. So if you set longs, you may want to cover and wait to see if it moves back up. If not then target 9632 where I would set up longs again.

http://www.morrisfunds.com/storage/f...05.22.2008.PNG

  • #120
  • May 22, 2008 4:10am May 22, 2008 4:10am
Good morning everyone. I asked that the thread name be changed to more accurately reflect the content. Since we are discussing more than just the EURUSD.

EURUSD - Looks like traders are trying to take the market lower at this point. I still do not think we have satisfied the topside objective area yet. I am still looking for a good push through the 5820 level on up to maybe 5865. If we continue down, look for ADV to hold at 5717 and look to set longs.

USDJPY - The long trade out of ADV at 102.79 area is progressing upward nicely. The market is currently trading at 103.26

GBPUSD - Sterling is heading up out of the 9732 value level towards ADV at 9837. Longs are working nicely here.
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