Circular Trendlines

Not much upward action, with low of today not hit yet. This low is around 2500-2509 level

Another depiction using a different set of circles gives 2493 as a buy zone.

Lets see what happens next...

M15
I have drawn several circles here, to see whether from the path of resistances and support a conclusion can be drawn as to where this pair is going. From the narrow channel shown by the sqeeze of the 2 blue circles, chances of a up move can only be present through a super thrust that will go to the pole of the smaller blue circle around 2460. If that does not happen, then we will dip to 2340, which is roughly 3/4 of the diameter of the bigger blue circle. So far the only good trade is to stay out and see what happens.

Daily
On the daily time frame we have a severe break of the 2600 level, which does not show any signs of a strong retest. A repeat of the 2010 June 6th might happen again, or at least we will be heading close to those levels again. The next double digit level to look forward to is the 2200 level, and at that point we have a 1000 pip drop from our 3200 level, and as mentioned before market makers like to think in terms of multiples of 1000 pips when moving price levels.

We are looking for a circle which will provide a strong pole bounce, and to date that has not happened on the Daily time frame. So as long as it hasnt and we havent travelled 20% of the vertical diameter of the circle we are going down.

Upward movement to resume soon, whether its going to be a trend change on the daily is questionable:


Red circle pushing out, trying to prevent further down move. We are almost at the end of today's move. A spike upwards through the narrow straight provided by the 2 red circles is quite possible at this level.

Kambooj, this is not done according to your methodology so please bear with me. I just started playing with fib arcs and this came up. I guess the moment of truth is very near if not already here, plus a historic s/r level at around 2330.

http://i48.tinypic.com/15exwnq.jpg

I agree with your timing about the moment of truth, I am looking at the Weekly chart to try to make some sense out of the cascading drops that are happening and gaining momentum,

specially when there was not more than a 50 pip move counter trend move this morning from 2423 to 2470.

On top of that hanging around 2370 zone after the close does not make a lot of sense in terms of a possible yearly low.

The only thing that is making me worry is a very powerfull impulse wave that will go beyond 2200.

I remember very vividly that on June 4th 2010, everybody was waiting for the NFP to drive the price up from 1.2130 zone. When the NFP came out, it went down again, and then the expectations were to go furhter down the week after. The week after (June 7th 2010) it went up and hasnt came back to that level up to now. It went up 600 pips in 14 days !

What makes me wonder, is that pretty soon, we will have 1000 pips of movement from 3200 to 2200 the way its going now.

If the NFP is meant to take us up, then at least prior to NFP, we should see some form of a subdivision and spikes as we get close to 2200 on the daily/H4 time frames.

At least at around 2370 region, we should see something like this, but we are not seeing anything. This is not very good news for hopes of a turn around.

If we just glide smoothly to 2200 level, then most probably than not the NFP is the catalyst that will break 2200, and if that happens, the 2010 low of 1870 will also get broken in due time, because now on the weekly time frame the shown circle will be broken and we will end up at 1.1200.

I am including my analysis on the weekly chart to show this point more clearly.

I am wondering what are our market makers thinking as they drive the price down further down towards the NFP time line.

So far the strategy of 30-50 pip up during the open of a session followed by a 100-120 pip down everyday has worked very well for market makers to lower these levels from 3200 to 2370.

The 50 levels such as 2350,2450,2550, etc are the ones that I notice are being watched by market movers and as long as price does not break them substantially somebody is pushing prices down at those levels

At every double digit level such as 2400, 2500, 2600, etc, price is barely making any upward moves, and fake moves start to show themselves.

It makes me wonder whether the organizations that are pushing prices down do not have the resources to drive price more up, but thats not true, because they do, but the intention is to take it further down towards distant levels that might not be apparent yet.

So as far as we long as we dont get a strong sustainable move upwards this pair is going down.

Sustainable move is something that looks like 600 pip in 14 days

This pair will be maintaining itself between 2350-2400/2420 for today. Reason is that its the best strategic positiong of confusion for a setup for tomorrow.

2 very strong support levels have been broken on this time frame, one was at 2800 where the base of the curve is located, and one is at 2460 level. We had a retest of 2800 level, but not a retest of the 2460 level.

Maintaining the currency within this range leaves the option of a false break of 2460 open for tomorrow.

Also if decision is made to go lower, there is at least a good 150-180 pips of room left for the drop to reach 2200 mark.

This mornings attempt to make it a sustainable move above 2400 has failed. No significant circles of support can be drawn on this time frame, until more points show themselves.

The move downward must hit the south pole of some kind of a circle, upon hitting the pole a strong upward reaction has to occur. So far it looks like whatever circle that could have been drawn on the H4 time frame has failed to maintain a strong hold.

So for now, we are short on this time frame, with possible setup to go short at 2460

HERE is a update on the situation...

As It was mentioned before yesterday in the following post:

http://www.forexfactory.com/showthre...37#post5716937

a retest of 2460 was a expected move. This move does not make the situation bullish. The 1000 pip target from 3280-2280 has been reached, but we need to be above 2460 to have any sustainable chance of going long. Also be aware that on the daily time frame for a strong switch to happen, we need to be at a important buy zone too. We are in the middle of 2 important buy zones, with the next buy zone being around 2150.

The next step is whether we will maintain ourselves above 2400.
We are below the 50 level (ie 2450), below 2400 we will be dipping further to 2150, where there is a strong buy zone.

Thank you Kanbooj, I made tons today on it's way up, and made sell entries on top, I'll close those entries at the bottom.

The work you,ve been doing works like magic

:-)))

From a market maker perspective it makes a lot of sense to have this pair close below 2400 for today.

The reason is that 2460 is important level as mentioned before.

If you are above 2400, then chances of it breaking that level becomes high, and if 2460 is broken, then optimism starts to grow in people, and thats not good from a market maker perspective, because if that happens, we will be again back above 2600.

And as these market makers experienced from February to April when they kept prices above 3000 level, it was hard for them to convince the crowd to dip lower.

Now that they are lower, they dont want to go back into the same scenario of trying to convince people again.

So why not keep the pair in uncertain territories before making any attempt to move again. The best uncertain territory is around 2380.

I wouldnt expect any significant move above 2400 right now.

I am not familiar with speculating about market markers at all. But, it appears that all retailers are heavily and happily short euro. Wouldn't it be better for market makers to go the other way and squeeze them out by going up much much more before going down again? In a sustained trend market makers don't get much fun in it, isn't it? It's been a while that every man and his dog is shorting euro.

A strong upward reaction broke 2460 this morning, establishing a uptrend wave that is in its early stages of development.

The upward limitations of this thrust is around the vicinity of the blue and black cirle which roughly lies between the 2800-2850 mark.

A touch to the broken resistance of 2460 is expected, but this touch might not happen until we have reached the 23.6 fib retracement of the entire drop from 3287 to 2291, which is 2530 zone.

M1
This time frame is showing strong resilliance to any downmove after a slight breach of 2500 level.

M15
The vicinity of the center of the blue circle has been reached, but because of the tendency not to drop below 2480 on the M1 time frame, the up move will gain momentum and go to the second resistance at 2636 or very close to it at 2600 making the move within the blue circle a perimeter to perimeter move.

It has been really difficult to draw timelines on the daily/H8/H4 charts to see where is the extent of the next move, but based on the way that the circles are drawn the only conclusion that can be made at this point is whether we are in a slow uptrend move or a fast one, but timelines are hard to give.

The answer right now is that its a fast one (ie fast rise) for a number of reasons:

Break of the black circle should have introduces a longer drop than 2290 level, but motion had a good size rebound off the blue circle. The only way that movement will continue, and not to fall below the solid straight red line is that if it climbs fast within the blue circle in the zone shown. If it does that, then its gonna end up at one of the lines T1, T2, T3 and then it has a chance to stay above the 2600 level (Solid Green Line) and move further up.

If the speed requirements are not there, there is little chance that motion will stay inside the blue circle. Because its a weak area (south east corner), and it will eventually break through the blue circle and end up at 2000 level, or somewhere close to it.

The best timeline so far is June 12th, and within that time we got be at one of the lines shown

Failure to push through more upwards towards 2600 has put the upward motion in jeopardy.

As mentioned in the previous post, EUR had to move fast upwards, if it wanted to have any chance of survival.

For now the only place where a long order is worth trying is the 2360 zone.

This place offers the tightest stoploss and lowest risk.

Give it a bit of time. London is out of markets until Wednesday. It has more than 60% of the volume.

Could be tomorrow as you have mentioned, but for now I see more down move...

Encapsulating circles show resistance and support boundaries, with intersection of the circles with straight lines showing time slots, where a action/reaction can occur.

Didnt have anything better to do this afternoon with a dead market ,

so drew these lines.

I hope we can get some upward action towards 2800 or so, otherwise daily looks like its not done yet.