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EurAnalysis Kindergarten 24 replies

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  • #11,921
  • Nov 24, 2011 4:52pm Nov 24, 2011 4:52pm
Quoting conexer
Awesome thread!! Kind of a newbie here but just wondering if this would be a good short term trade or a good time to jump on the trend as i see it ripping through all support zones. This is probably a more aggressive trade.

-Daily resistance from Feb 14 (See Daily Chart)

-1 hour shows good Fibs from the last two swing highs of 23% & 38% for aggressive entry. (See 1 hr Chart)

Would like to see a more conservative analysis for entry with the trend if anyone would care to elaborate.

Thanks in advance
Almost got to my retracement. Where's the next resistance to jump back in with the trend?
  • #11,922
  • Nov 24, 2011 5:48pm Nov 24, 2011 5:48pm
AW
Since it is Turkey day, just a quick stop back.
I have no idea that can explain what is going on with price for sure. But for now if this pair was going to put in a retrace would seem that it should have been underway by now.
Until it establishes a direction up then the prior direction down is still in force.

The GBP and Aussie and Cad are all experiencing weakness.
The wickyness of the Euro is also a symptom of the constant forces of manipulation, oops mean currency management that it is subject too.
The Euro just appears to me as a currency that is being supported in an effort to give it legitimacy. As this post is made it is a curious thing that the GBP broke the 1.5500 level, Aussie broke 97.00, Cad is poised to break above the 1.05 level in a few more pips. But it must be a miracle of the hand of higher power that the Euro maintains above 1.3300.
Although I am a believer in miracles, this type of miracle I remain a nonbeliever.

This baby should fall further as the fundamentals remain absolutely horrible.

Maybe someone else has another take on the matter. For now this is my best shot.
  • #11,923
  • Nov 24, 2011 5:59pm Nov 24, 2011 5:59pm
Quoting FXMindset
Took long @ 1.3337 - 1.3322/Risk 1% - TP : 1.3367
Close @ BE
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If there was easy money lying around,no one would be forcing it into your
  • #11,924
  • Nov 24, 2011 7:30pm Nov 24, 2011 7:30pm
Quoting foto
AW
Since it is Turkey day, just a quick stop back.
I have no idea that can explain what is going on with price for sure. But for now if this pair was going to put in a retrace would seem that it should have been underway by now.
Until it establishes a direction up then the prior direction down is still in force.

The GBP and Aussie and Cad are all experiencing weakness.
The wickyness of the Euro is also a symptom of the constant forces of manipulation, oops mean currency management that it is subject too.
The Euro just appears to me as a currency...
Hope you are enjoyed your turkey. I think I will go out and buy some Beijing Duck to celebrate.

I agree that you see the "human hand" behind market action. By all accounts the Euro should be leading the fall in risk on currencies. Instead it the most bullish of the risk currencies. Off hand there are several explanations...

1. Euro banks suffer from lack of liquidity so they are selling all their non Euro assets and buying Euros.
2. The ECB and/or the FED are working a currency peg
3. The big sovereign funds (primarily China + Middle East) are diversifying their USD portfolios as they have a long term plan to dethrone the USD as the world reserve currency
4. The big sovereign funds (primarily China + Middle East) are secretly pegging the Euro to the USD to maintain high prices for their goods in the worlds largest market

Of these 4 explanations I like 1 the best and 2 the worst.

Hope you are enjoyed your turkey. I think I will go out and buy some Beijing Duck to celebrate.
Kill the ego, or it will kill the mission.
  • #11,925
  • Nov 24, 2011 7:31pm Nov 24, 2011 7:31pm
--Friday, Nov. 25: Italian T-bill/zero-coupon bond auction.
  • #11,926
  • Nov 24, 2011 7:58pm Nov 24, 2011 7:58pm
Quoting foto
The Euro just appears to me as a currency that is being supported in an effort to give it legitimacy.
But it must be a miracle of the hand of higher power that the Euro maintains above 1.3300.
Although I am a believer in miracles, this type of miracle I remain a nonbeliever.
This baby should fall further as the fundamentals remain absolutely horrible.
Maybe someone else has another take on the matter.

Certain privileged interests will always have access to information in advance long before us mere retail traders first see those red/green pips crash on our screens,and I'd imagine therefore that "educated guesses" are being made by these same interests which might explain why the euro is still holding it's levels.

There was already a good discussion about this much earlier on the thread today, my 2c would be that Merkel is just playing to her home voter audience whilst also playing chicken with other eu member states to extract a better deal (ie more extreme fiscal centralization on her terms which she can better sell to her Bundestag), before at the final Armageddon minute agreeing to some form of more concerted ECB bond buying / Monetization / Euro Bonds etc. Although long drawn out treaty changes are required for many such changes, the mere announcement that Germany is finally "with the program" would certainly boost markets in the short term.
Also in the short term there's nothing really to stop the ECB from purchasing threatened member state bonds as much as they want, as long as Germany turns a "blind eye" and acquiesces. No way will Germany allow the euro to fail that's for sure, and I believe Merkel is just waiting for the right conditions to best sell her "save euro/europe" plan to her voters.

Also Germany as a federal state was well used to the necessity of funding transfer flows from the richer to the poorer states as a necessity long before unification with the east, and these transfers are seen as normal. No big deal then to sell that same idea on a euro wide level to her voters either once the time is right. And the time will be right when her scare tactics have worked and the "fear of god" has been well & truly put into all profligate member state governments (those that haven't yet been deposed that is) .... I believe it's called "Making an offer they can't refuse"
The spoken word is your master, the unspoken word your slave.
  • #11,927
  • Nov 24, 2011 8:03pm Nov 24, 2011 8:03pm
The more I think about the European situation, the more I have to wonder why they forgot to include a lender of last resort in their banking system. What were they thinking? A Titanic that doesn't need lifeboats?

Whats more, formerly each country had a lender of last resort. So effectively, coupled with the decision to join their currencies together, they jointly decided to burn all their lifeboats.

How dumb can you get?
Kill the ego, or it will kill the mission.
  • #11,928
  • Nov 24, 2011 8:22pm Nov 24, 2011 8:22pm
Quoting AaronWard
The more I think about the European situation, the more I have to wonder why they forgot to include a lender of last resort in their banking system. What were they thinking? A Titanic that doesn't need lifeboats?

Whats more, formerly each country had a lender of last resort. So effectively, coupled with the decision to join their currencies together, they jointly decided to burn all their lifeboats.

How dumb can you get?
Mmmm... maybe I'm on thin ice here but surely the ECB is a lender of last resort to the member state Central banks. Also, each individual member state retains it's own central bank which is also another lender of last resort to it's own national banks. I know in Ireland we're crippled with huge funding loans from the ECB to our own Central bank (hundreds of billions), and also our central bank has also funded our Irish national banks to the tune of approx 50 billion (all dodgy collateral)....OUCH!!

BTW not quite sure as to my exact facts/figures above as I haven't checked them, but my main point was that we do have a lender of last resort in the national CB's and & ECB. I think perhaps what you may have been getting at was that the ECB won't print like the Fed!
The spoken word is your master, the unspoken word your slave.
  • #11,929
  • Edited 8:43pm Nov 24, 2011 8:27pm | Edited 8:43pm
This is what I am getting at:

http://uk.news.yahoo.com/ecb-cannot-...203419270.html

To be sure, I am not 100% clear on the exact role of the CBs for individual countries, but I don't see how they can be lenders of last resort if their funds are limited and they can't print.

EDIT: I think the term "lend of last resort" is a bit confusing. Technically it is really the very last lender before there are no lenders and you default or declare bankruptcy. But in this context it means that the ECB is not going to backstop the European financial system and the individual CBs don't have the necessary fire power to. Certainly there is no counterpart to the Fed, the BOJ or the SNB in the European monetary system.
Kill the ego, or it will kill the mission.
  • #11,930
  • Nov 24, 2011 8:45pm Nov 24, 2011 8:45pm
will we see the ECB come in Friday and buy sov bonds and so arrest the euro's slide?
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,931
  • Nov 24, 2011 8:47pm Nov 24, 2011 8:47pm
Quoting AaronWard
This is what I am getting at:

http://uk.news.yahoo.com/ecb-cannot-...203419270.html

To be sure, I am not 100% clear on the exact role of the CBs for individual countries, but I don't see how they can be lenders of last resort if their funds are limited and they can't print.
I suppose it comes down to the definition of "lender of last resort". ECB can definitely not fulfill this in the strictest sense because as you say their funds are presently limited as they can't "print". They still hold us in hock for those couple hundred billions though so in that respect they were a last resort for us! Grrr!
The spoken word is your master, the unspoken word your slave.
  • #11,932
  • Nov 24, 2011 8:59pm Nov 24, 2011 8:59pm
Quoting The Fool
will we see the ECB come in Friday and buy sov bonds and so arrest the euro's slide?
God I hate your avatar. You are just so much better than that sleaze bucket.

Anyway I think we may be past the whole 7% v6% bond rate issue. This must be round 3 or 4 and each round is less important than the round before it. At some point people need to start asking how they are going to sterilize these bond purchases. Liquidity is freezing up in the banking system. Are they really going to suck more cash out of the system?

And if they can't sterilize, then they are practicing QE to the tune of 200B Euos. Each week they add another 10B to the total and that works out to 500B a year.
Kill the ego, or it will kill the mission.
  • #11,933
  • Nov 24, 2011 9:34pm Nov 24, 2011 9:34pm
Quoting AaronWard
At some point people need to start asking how they are going to sterilize these bond purchases. Liquidity is freezing up in the banking system. Are they really going to suck more cash out of the system?

And if they can't sterilize, then they are practicing QE to the tune of 200B Euos. Each week they add another 10B to the total and that works out to 500B a year.
Very good point, PT has also been highlighting this possible surreptitious form of QE. Looks like one way or the other it's going to happen eventually, and maybe the non-sterilization will be an initial first step without attracting too much attention.
The spoken word is your master, the unspoken word your slave.
  • #11,934
  • Nov 24, 2011 11:25pm Nov 24, 2011 11:25pm
Quoting Pip_Pursuer
Good question, and great answer. Thanks guys! Helping me to build a clearer picture of how the world's economy works. Which in turn helps to understand what is going on in the markets. Really enjoying the knowledge here.

Thank you PT ... before asking the questions I was sure you are going reply in very simple words which is going to be a great help for many people trying understanding the hard parts of Forex.
  • #11,935
  • Nov 24, 2011 11:30pm Nov 24, 2011 11:30pm
Placed an Buy Order @ 1.3240 for EUR USD the reasons are:

1. PA: Downwards may hit the target.
2. TA: Historic days Low around that number.
3. FA: Friday, in a bearish market price can reach that point at the pick up point later when people will close their positions and take out the weekly profit price may retrace back to 1.332x.
4. BS: My intuition says to buy from a weekly lower
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  • #11,936
  • Nov 24, 2011 11:31pm Nov 24, 2011 11:31pm
Good European morning all

It looks like there is still significant pressure on the Euro so far.
Price continues to hammer away at support. It is not getting too far in a hurry but slowly slowly it is eroding away level by level.
I have been expecting a significant correction for the last 10 days now, and here we are 200 pips lower and we still have not got it. Patience is key.

I am still calling for the 1.3430/40 area as a zone of unfinished business.
Alorente is calling for a significant correction to 1.37
Sisse is expecting to see 1.39 before year end.

So many expectations from us retail traders, so little cooperation from the market movers.



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Those who say it cannot be done should not interrupt those who are doing it
  • #11,937
  • Nov 24, 2011 11:51pm Nov 24, 2011 11:51pm
Quoting rekon67
Placed an Buy Order @ 1.3240 for EUR USD the reasons are:

1. PA: Downwards may hit the target.
2. TA: Historic days Low around that number.
3. FA: Friday, in a bearish market price can reach that point at the pick up point later when people will close their positions and take out the weekly profit price may retrace back to 1.332x.
4. BS: My intuition says to buy from a weekly lower
All good reasons, but 1.3240 is a bit low and according to technicals, it may be out of reach for today. I am not saying it will not reach there. It may even reach 1.31, but looking at the daily chart, it order for price to reach 1.3240, it would have to break the channel support and blow by the 88.6% fibo level.
1.3270 or closer to it would likely stand a better chance of triggering.

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Those who say it cannot be done should not interrupt those who are doing it
  • #11,938
  • Nov 24, 2011 11:57pm Nov 24, 2011 11:57pm
Yesterday
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Today
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Those who say it cannot be done should not interrupt those who are doing it
  • #11,939
  • Nov 24, 2011 11:58pm Nov 24, 2011 11:58pm
There is a pressure but so far so weak - lets see what london bringing
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If there was easy money lying around,no one would be forcing it into your
  • #11,940
  • Nov 24, 2011 11:58pm Nov 24, 2011 11:58pm
Good morning. EURUSD continues to test the bottom wall of the wedge without breaking it, but without the expected bounce off it either. Divergences in the Trix and RSI continue and the RSI is still above the ascending trendline. Technically the longs still have a feasible trade, but if the wedge wall is pierced, the bears will have won the day.
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Observation is the path to discovery.
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