I apologize for not updating my trades up to the minute. I have been away from my computer lately and doing trades over the phone. Its summer time you know...
Exited Eur/usd put at 1.3180 for a $2,100 profit including the time value from put.
Exited Eur/JPY call at 135 for $3,200 profit including time value.
the eur/jpy is still in a steady uptrending chanel and I will by another call at around the 130 to 131 region first targeting 140 and then 145.
Long here at 99.00 on USD/JPY. Am anticipating a move lower however possibly to 97 where I will add onto my position. Overall upside target is 103-104 before next significant pullback.
Bought call @ 131 on EUR/JPY for $3,230 targeting 140.
Long Aud/jpy 71.75 targeting 82.
There are no stop losses on these trades.
I might by a call on the GBP/JPY as well.
I will keep you updated on if I sell any calls at resistance levels. Most likely they will only have a weeks duration so as to avoid capping my gains.
There is a bearish technical divergence on the daily chart of the USD/JPY with the rsi indicator and the price action. I am expecting a pull back to at least the 98 level which will be a good place to add on a long. Hopefully we make it back down to 97 so i can start building from there.
Im short here @ 1.3051 on the breakout on the eur/usd pennant. The weekly chart and the pattern projection suggest a move back to 1.25. First target 1.29 however.
As you can see here on the weekly chart we have have very bearsish looking price action on the eur/usd with this break out from the pennant. You can see that we bounced off of the downward trending resistance line that makes up the top of this triange and are once again heading towards the bottom of the pattern at about 1.25. Also something to note is that when you project a target for the pennant price pattern you take the "flag pole" and project it from the breakout. This would put us right back where the flag pole starts at 1.25 as well.
A descending triangle usually completes its pattern at least about 3/4 of the way between the interesecting downward trending line and horizontal support line. Therefore, we should get a breakout to either the downside, (below 1.25 tareting 1.20 and then 1.16 initially and heading towards parity), or a break to the upside above the doward trending resistance line which would send us back towards 1.47-1.50 level.
The coming weeks will be very crucial in determing this pairs direction. A descending triangle is "usually" a bearish continuation pattern; however, with all of the rejections off of the 1.25 level when fundamentals were stronly backing the dollar and things a bit more uncertain now, I'm not sure if the dollar is strong enough to break that phychological level.
It's going to be interesting. So short presently targeting overall 1.25 but first 1.29.
As of writin this price action is at the 1.2990 level. It seems to me looking over the economic calendar that if there is a time for the eur/usd to retrace the time would be now. Starting tomorrow we have Zew sentiment that is expected to improve, wednesday the euro gets a breather, thursday is pmi an current account expected to improve, friday we have the German IFO report that is usually responsible for a lot of volatility also expected to improve. I believe the risk lies to the downside with all of these announcements because of the terrible condition of the eurozone. I think traders might be disappointed with the data which will in turn weaken the euro and drive down the eur/usd towards our 1.25 target.
So if we see a retracement I would expect it to be now. 1.3080 shoulder serve as resistance as well as 1.3130-50. I would expect that level to cap gains. Above that we have the 1.33 level and downtrending line we have on the weekly chart. A break of that resistance line would open things up towards 1.47-1.50
The IMF could be a wild card this week. Their statments have recently been causing alot of movement. Though they have been gloomy recently, and with good reason, any optimism could stir risk appetite and possibly weaken the dollar.
lol I'm already getting back in at 1.2930. Targeting 1.27 region at 1.2725. Stop loss 1.3150. Next target after that is 1.25.
On a longer term note. More weakness from the eurozone and mishandling of the recession and increased risk aversion by the ECB could give us that clean break that we need on the descending triangle on the weekly chart sending this pair towards parity.
On a close below 1.23 on the daily chart will buy a long put targeting 1.10 or weekly close below 1.25.
So the Zew came in above expectations unlike I expected and has helped to boost the euro. the 1.2960-90 region is capping further upside for the time being. Further resistance is at 1.3050 and then again at 1.3080
I'm going to take advantage of this increase in the GBP. with a long put option. That way I can't risk more than my premium. Option prices have finally decreased lately as volatility has been easing from the markets.
The Pound recently fell out of its upward trending channel and is near 1.4550 support.
Buying a put here @1.4650. Premium payed $2,100 to expire on the 14th of May.
Im exiting my short here at 1.2914 for a $130 profit on the eur/usd. I'm doing this for some better positioning. I have a placed a limit sell order on the eur/usd at 1.2980. With a stop loss at 1.3200 and a limit order of 1.2720
back in here at 1.2983. I'm not sure why the euro strengthened when the imf had negative things to say. We saw a strenthening yen from that statement as would be expected and a weakening pound. However, the euro somehow has strengthen on this negative economic news.
I am expecting weakness to resume in the euro as more pmi, current account, and business climate come out tonight. I expect them to all accentuate the ongoing weakness in the eurozone. In addition, equitity markets have failed to significantly rally past the 8,000 mark and have been stalled here for about two weeks now. Equities are now contending with a downward trending bear market line. Also, as I have previously pointed out. This rally in equites has been on low decreasing volume. While the market selling has been on higher increasing volume.
Though I think we are near a market bottom, which is why I am building short yen positions, I think risk aversion is not over and the optimism over the tarp will wane leading to an increase in government bonds and a demand for the dollar.
Todays rally in the Euro seemed overexaggerated after geithners statment as the yen still held its own and pound continued to be weak. I think Geithners speech may have given the market an excuse to take profits around 1.29.
The ECB's indecision and deepening recession will also be factors at play that will drive this currency pair down to dynamic support at 1.2500.
I do not know if this level will be broken thus completing the descending triangle we have have been obversing; however, a case is building for such a move.
Its interesting to note that the announcement of falling home sales in the U.S. weakened the dollar against both the yen and the euro after the announcement like in the days of old pre-dollar safe haven. This price action may signal that risk appetite is increasing. During risk aversion times, the dollar would still weaken vs. the yen but strengthen against the euro on the bad economic data.
The German IFO report is notorious for creating alot volatilty in the eur/usd. Predictions are for a mild increase in the number. With conditions in europe worsening I am expecting a disappointing number. However, given all the good european ecomic data that has come out this week, I will keep an open mind . I think that the direction of this announcement may determine the direction of the euro in the short term.
Way above expectations i think will see us move to 1.33 while i think below expectations will see us continue our downtrend towards 1.25.
So I will be exiting my position to go long if data is positive and keep it running if it is negative.
