Hey guys,
Although this is my first post here on FF, I've been lurking around for quite a while (forgive me
) and want to say that I am greatly impressed with this thread and the high quality discussions/analysis taking place. I too am a believer that the market is order-driven, and that if you can know ahead of time what traders are going to do, you can jump in ahead of them to profit.
If I may, I would like to give my opinion on what went down today in the EUR/USD pair
:
The first time I checked the pair today was after the sharp decline in price during the early parts in the Asian session, when price had been consolidating into the 1.4140 - 1.4120 range. These are some of the things that I took notice:
Although this is my first post here on FF, I've been lurking around for quite a while (forgive me
) and want to say that I am greatly impressed with this thread and the high quality discussions/analysis taking place. I too am a believer that the market is order-driven, and that if you can know ahead of time what traders are going to do, you can jump in ahead of them to profit.If I may, I would like to give my opinion on what went down today in the EUR/USD pair
:The first time I checked the pair today was after the sharp decline in price during the early parts in the Asian session, when price had been consolidating into the 1.4140 - 1.4120 range. These are some of the things that I took notice:
- In my opinion, no major news had come out that could have acted as the catalyst for the drop in price during the Asian session.
- However, the news that had been coming out in general from the Eurozone had been the usual stuff we've been hearing for the last few days (in other words, no major developments).
- The fact that there has been nothing solid to lean for people to lean on has caused, in my opinion, a LOT of uncertainty in people's minds about where the pair is going to go. In other words, the sentiment is that of uncertainty.
- The sharp drop in price during the first part of the Asian session indicated to me that the 1.4200-1.4100 area was more illiquid than usual. This made sense because if people are uncertain about the pair, they are unlikely to be placing a large number of limit orders, and it showed in the price action.
- However, there are a number of interests still holding long positions (what lead me to think this was looking at the COT report as well as the rumours in the last few weeks of major interests buying near this area, as Monroe mentioned about ACB).
- It is unlikely those people who are long would let price fall to the 1.4000 area if they can help it, as I am sure they are still holding major positions and a piercing of this level to the downside may cause a slight shift in sentiment that would make it harder to drive price back up and unload at a profit. This may be why we saw consolidation as noted earlier, with bids being placed around the 1.4100 area (I saw those rumours floating around, forget if it was IFR or forexlive).
- As we neared closer to the London session, I figured that the area above the consolidation zone was probably still relatively thin on liquidity, and so it would be a good opportunity for those long interests to try and run up price. So I took a fade right before the run up to the 1.4160 level (left half my profit on the table after the retrace though
). - At this point I was tired, and went to go sleep, but placed a long at around 1.4150, thinking that there was a much greater chance for good profit to be had going long than short due to the bids standing in the way of a short at 1.4100 (I'll admit it wasn't the best entry, but I managed to clip 70 pips).
Does any of this sound reasonable lol? I am relatively new to trading and this is all on a practice account (just started actually placing live trades).
thanks,
theColonel
.
The more and more I trade, the more I really begin to identify with these vague axioms...guess they're there for a reason...