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EurAnalysis Kindergarten 24 replies

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  • #12,481
  • Nov 29, 2011 6:32am Nov 29, 2011 6:32am
Quoting jihad441
in the usd index there is a h&s maybe usd down it means eur up ?

and thanks dddd
Yes it does look like a H/S pattern. I pointed out this pattern earlier as an inverse H/S on the EUR/USD chart. However, it seems to have failed to follow through as price was aggressively rejected after it surged a number of pips past the neckline.
Those who say it cannot be done should not interrupt those who are doing it
  • #12,482
  • Nov 29, 2011 6:32am Nov 29, 2011 6:32am
Quoting lovepips
well done on the pips :-) ...

I was asking what is your typical risk/reward? Is it 1:1, 2:1, 3:1 etc

e.g. you have a 10pip stop loss with an expected return of 10, 20 or 30pips
15:30
  • #12,483
  • Nov 29, 2011 6:35am Nov 29, 2011 6:35am
Quoting PipTrapper
Yes it does look like a H/S pattern. I pointed out this pattern earlier as an inverse H/S on the EUR/USD chart. However, it seems to have failed to follow through as price was aggressively rejected after it surged a number of pips past the neckline.
you are refering to this?

http://www.forexfactory.com/attachme...8&d=1322563251
  • #12,484
  • Nov 29, 2011 6:35am Nov 29, 2011 6:35am
Quoting jihad441
in the usd index there is a h&s maybe usd down it means eur up ?

and thanks dddd
Usd Index down means surely all the USD pairs would get effected in Reverse Order
  • #12,485
  • Nov 29, 2011 6:36am Nov 29, 2011 6:36am
i see another h&s and doble tops and a pullback i beleve it is going down on usd index
Attached Image (click to enlarge)
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  • #12,486
  • Nov 29, 2011 6:36am Nov 29, 2011 6:36am
Quoting RodMca
S&P 500 testing 1200 level if we break and hold it truly is risk on.. For how long is the question? Median end of year estimates lie at 1269 thats 5.75% gain from here on in. Some mad analyst on Bloomberg called for 1420 on the SP 500 before year end!
But the important thing to look at is the correlation between eur and sp500. If we see that 5.75% gain in sp it leaves us looking at 1.41 in eur/usd.. I personally cant see that happening but interpretation can always be wrong as well as estimates but firms will want to make whatever they can before...
Rod,
I've posted weekly charts before to show how the Euro decoupled from the SP500 before.
Pull up the weekly charts of both the SP500 and the EUR/USD on your screen and look at how the Euro plummeted into late 2009 and early 2010 while the SP500 enjoyed a rally.
Those who say it cannot be done should not interrupt those who are doing it
  • #12,487
  • Nov 29, 2011 6:37am Nov 29, 2011 6:37am
Quoting michaelnew
15:30
This is basically 1:2 RR
  • #12,488
  • Nov 29, 2011 6:40am Nov 29, 2011 6:40am
Quoting dddd
you are refering to this?

http://www.forexfactory.com/attachme...8&d=1322563251
Yes and here is the end result...

Attached Image (click to enlarge)
Click to Enlarge Name: eu-h4.gif Size: 43 KB
Those who say it cannot be done should not interrupt those who are doing it
  • #12,489
  • Nov 29, 2011 6:41am Nov 29, 2011 6:41am
Quoting PipTrapper
Yes the money was used to purchase sovereign bonds. That means that there is now an extra 200 billion euro in circulation. (effectively QE)
The ECB tries to sterilize those bond purchases by reabsorbing the liquidity. They do this by selling term deposits to financial institutions through a tender and they sell them to the bidders who accept the lowest return... kind of like a bond auction would.
The problem here is that their net balance keeps growing because nobody wants to buy these term deposit certificates.
you and michael might be interested in this

http://www.reuters.com/article/2011/11/29/ecb-bonds-sterilisation-idUSL5E7MT2WQ20111129

ECB fails to fully offset bond purchases
From reuters.com
http://www.forexfactory.com/images/misc/news_quote.gif The European Central Bank failed to attract the 203.5 billion euros from banks on Tuesday needed to offset its euro zone government bond purchases, instead managing to draw just over 194 billion euros. The failure was the ECB's first since May. The pace of the ECB's government bond purchases picked up last week as the bank spent 8.6 billion euros in its ongoing attempt to calm euro zone debt markets. The central bank takes seven-day deposits from commercial banks on a weekly basis to offset its spending in order to ensure inflation pressures do not build up due to additional money in the financial ... (full story)
  • #12,490
  • Nov 29, 2011 6:42am Nov 29, 2011 6:42am
Quoting dddd
you and michael might be interested in this

http://www.reuters.com/article/2011/11/29/ecb-bonds-sterilisation-idUSL5E7MT2WQ20111129
So they fail to sterilize the thing... That's even funnier
  • #12,491
  • Nov 29, 2011 6:48am Nov 29, 2011 6:48am
Quoting dddd
you and michael might be interested in this

http://www.reuters.com/article/2011/11/29/ecb-bonds-sterilisation-idUSL5E7MT2WQ20111129

ECB fails to fully offset bond purchases
From reuters.com
http://www.forexfactory.com/images/misc/news_quote.gif...
What Reuters is reporting cannot be true. This is not the first time they have failed to sterilize since May. They have failed over and over again every single week since May and that is how they got to a net offset of 204.5 Billion Euros. They certainly didn't purchase that much worth of bonds in the last week.
Those who say it cannot be done should not interrupt those who are doing it
  • #12,492
  • Nov 29, 2011 6:48am Nov 29, 2011 6:48am
Quoting michaelnew
15:30
ahh ok thanks... the reason I was saying 'careful' is that:
Looking at the 5m candles (starting at 12:05) we can see that there was resistance to further downward movements. It may well go down to 3300 but for me that trade is too risky at this point - typically I like to get a 3:1 return, so I would've been stopped out on that trade.
patience is a virtue
  • #12,493
  • Nov 29, 2011 6:53am Nov 29, 2011 6:53am
For me eur/usd 15min chart is still bullish.If it breaks the below trend line then we are again heading in bearish mode.
Closed my long from 1.32298 to 1.34125 so now I am flat and waiting for clear indication or charts.
Attached Image (click to enlarge)
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Bulls Run. Bears Bite. We Profit.
  • #12,494
  • Nov 29, 2011 6:53am Nov 29, 2011 6:53am
Quoting lovepips
ahh ok thanks... the reason I was saying 'careful' is that:
Looking at the 5m candles (starting at 12:05) we can see that there was resistance to further downward movements. It may well go down to 3300 but for me that trade is too risky at this point - typically I like to get a 3:1 return, so I would've been stopped out on that trade.
I saw that support too, but I'm counting on the speed of the downtrend. On the M15 chart you see 2 green candles, used perhaps to take some profits, and now the last candle is pretty bearish, engulfing both the preceding candles. I may be wrong, of course.
Attached Image (click to enlarge)
Click to Enlarge Name: eur-usd-29-nov-2011.png Size: 18 KB
  • #12,495
  • Nov 29, 2011 6:53am Nov 29, 2011 6:53am
Quoting PipTrapper
What Reuters is reporting cannot be true. This is not the first time they have failed to sterilize since May. They have failed over and over again every single week since May and that is how they got to a net offset of 204.5 Billion Euros. They certainly didn't purchase that much worth of bonds in the last week.
zerohedge had that since last week:

http://www.zerohedge.com/news/one-ma...-sterilization
  • #12,496
  • Nov 29, 2011 6:55am Nov 29, 2011 6:55am
Hmmm...may be will get another better SELL entry for more pips ... but above 1.34xx
Attached Image (click to enlarge)
Click to Enlarge Name: EU8.GIF Size: 37 KB
  • #12,497
  • Nov 29, 2011 6:58am Nov 29, 2011 6:58am
Quoting michaelnew
I saw that support too, but I'm counting on the speed of the downtrend. On the M15 chart you see 2 green candles, used perhaps to take some profits, and now the last candle is pretty bearish, engulfing both the preceding candles. I may be wrong, of course.
I'm flat now but I'd like to see it get there within the next hour, if it does I'm going long :-)
patience is a virtue
  • #12,498
  • Nov 29, 2011 6:59am Nov 29, 2011 6:59am
Quoting lovepips
I'm flat now but I'd like to see it get there within the next hour, if it does I'm going long :-)
It may take more than one hour. Let's see the NY session.
  • #12,499
  • Nov 29, 2011 7:00am Nov 29, 2011 7:00am
Quoting rekon67
Hmmm...may be will get another better SELL entry for more pips ... but above 1.34xx
I think you could be right.... let's see
patience is a virtue
  • #12,500
  • Nov 29, 2011 7:06am Nov 29, 2011 7:06am
Quoting PipTrapper
Rod,
I've posted weekly charts before to show how the Euro decoupled from the SP500 before.
Pull up the weekly charts of both the SP500 and the EUR/USD on your screen and look at how the Euro plummeted into late 2009 and early 2010 while the SP500 enjoyed a rally.
hmm ok i see what you mean! I also remember you saying tht the effective QE that the ECB are doing will also cause the correlation to become weaker because more euros in the system etc correct?..
I'll have to watch the correlation carefully and see if we see it becomes weaker.. I'd like to see 1.37 before year end but as things stand its highly unlikely. But until then I'll just trade whats in front of me

Quoting PipTrapper
with a E/J short at that level, I would try and hold it. Place SL @ BE It could be a long runner. Target is sub 100
And as for my short still holding with Sl at BE I'd like a bit of momentum to the downside but I'll wait and see what America brings and if i get stoppped I dont lose but look to re-enter!
Cheers
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