Alternative Technical Templates.

[Tess]

This is a tad late folks I’m afraid, but as I mentioned earlier we’re playing catch up here this week with events over the holiday period & I’m really taking full advantage of leisurely waking up times!!

Anyhow, EURJPY has backtracked a 38.2 Fib from the late Dec highs, & signalled a continuation of this current bearish journey.

Marrying the smaller timeframe picture with the larger print will, once again, have offered you options regards your preferred trigger area.

The support becomes resistance line up yonder on your 15min chart offered one such opportunity, certainly for you guy’s awake at the open of the Tokyo shift.

A second (compound?) entry was also an option 30 or so mins ago leading into Frankfurts opening ticks, at c161.25 (an IB running with the near term flows).

Just a heads up really. A new year, presenting the same old opportunities.

Regardless of the state of the market (high or low volatility….bearish or bullish stance….aggressive or passive behaviour blah blah), there will always be intraday & intraweek opportunities if you base your decision making around simple, effective price action analysis!!

[mustang]

Kerry Haladae, Google this "Jackos Anti-Hedging Strategy" I think this is possibly what you are talking about.
Cheers.

[Tess]

Those of you who prefer to take a purely intraday or shorter timeframe view on events, can still utilize similar tools to assist in assessing the state of play as price meanders around the price grid.

Price is, for the moment, adhering to the peak-trough behaviour on the smaller timeframe reference - printing lower highs & lows.

Plotting the shorter Fibs on your 15min frame will maybe help to offer a heads up to the possibilities of any pullback potential on aggressive moves thru the levels.

Price has a repetative habit of stalling out & bouncing on & around these math based area's of conflict.

They also often rub up against natural s&r levels & high-low price behaviour, such as lower highs & lower lows in downtrends....higher highs & higher lows in uptrends.

They allow you to calmly assess the current activity & properly adjudge whether you should be looking to maybe pare out partial profits, add more contracts or exit completely.

As prices begin threatening fresh intra-day/intra-week/intra-month highs & lows, different market players begin stirring & coming out to play with very specific agenda's.

Your particular trade plans & strategies can & will take advantage of these varied opportunites.....but only if you possess very specific & well defined trade plans!!

That's the key - know your game plan & play to those rules


Chart highlighting the intra-session fibs, looking to guage the potential & likely battle zones of any reactionary move off the session lows. The 50% Fib would continue to honor the lower low/lower high behaviour.

[Tess]

Looks like it ran into strong offers back up there at the 50% intraday Fib @ 161.50.

Checking out the strength of the trailing stops no doubt, but the sellers remain strong for now & will attempt another pop at session, as well as yesterdays lows.

That level will (as well as this 161.0 round number) also test the appetite of renewed bids down there.

A break below near term suport at c160.50 exposes the months lows @ 159.50-70, a strong area of Daily support.

[mustang]

Tess: You make an interesting comment in your previous post "checking out the strength of the trailing stops". Who or what is capable or moving the market to that extent, is it that these retracements are part of the self fulfilling nature of Fib levels or any level for that matter?
It seems to me that if you knew all about all of the players in the market then you could figure out what is going through their minds at these levels and profit from this knowledge.I hope you can see what I'm getting at!

[Tess]

Hello mustang,

Firstly of course, neither I nor anyone else come to that, knows exactly who holds stop/option/limit positions at x level or what percentage/strength of buy/sell stops are laying in wait at x level. Due to the very nature & diversity of FX it’s an impossibility.

But, experience of previous price activity on & around key psychological zones and/or the general ebb & flow of money in & out of key level activity on an instrument, constantly throws up clues as to how & why certain groups of market players think & act.

As well as working our own ongoing analysis & staying abreast of the ongoing fundamental flavors, I/we also speak to colleagues & ex-colleagues who still work a desk at large & semi-large firms all over the FX map. One or two of them are “aware” of customer flows, internal positioning, high tier broker activity, hedge fund/cta movements on certain pairs etc…..they/we also hear of stop level build up from a previous move which might have triggered last week or earlier this week.

Our Parents are very active on the phones to their previous colleagues at major Banks, they also receive decent info on pairs or crosses which are of interest – see where I’m coming from??

Sure, it’s not set in stone that a particular level will react as we’d like, but it offers us a good heads up to certainly stay on our toes as a level or zone of interest comes into focus.

There are definitely certain groups of players (large cta firms….short-term prop desks…..certain Bank pods) who aggressively punt price thru repetative breakout levels & previous round number zones. They’re active up & down the ladder day in, day out. Do they know something you don’t?? who knows, but they’re certainly not shy when laying their $$’s down. Or when cutting & running either!!

The very nature of short term speculation (by whoever participates) lends itself to keen protection measures (running tight stops). It’s not rocket science to sit back & take a hunch on the likely area’s where collective groups of stops (either exit/limit/entry) lie in wait, particularly if an instrument is “on the move”

That these levels also contain or house the Fib numbers is as you say, self fulfilling. If enough folks constantly refer to & plot these grids on the technical map, then I guess a good percentage of those levels will come into play?

I guess a lot ofit comes down to how one studies the price map. I’ve always & continue to try & adjudge who wants to take action at a certain level & why. Who really deems this specific level or zone important enough to protect it or run it…..and why.

But then, most of that train of thought/observation/planning etc is down to the prior training & instruction I’ve been privaliged to receive.

It’s not magic or mysterious really…..simply experience of watching these levels play out day in, day out over a long period of time. And constantly computing the odds of whether it pays me to take the bet…………………..or not.

[Pipcrawler]

Hey Tess,

Glad to see you back with us!

[Tess]

Originally Posted by mustang

...is it that these retracements are part of the self fulfilling nature of Fib levels or any level for that matter?

Sometimes it's quite simply the level or area which determines how much more juice is left in a move, especially an intraday one.

Well worth keeping tabs on the average daily range of your favorite pairs-crosses.

Obviously, if it's a big outside day due to the market being spooked by a fundamental print or unique development, then that consideration gets dumped.

But generally they won't wander too far from their normal mid term average prints (10-20 day averages).

Today's high-low behaviour is typical of that so far on the EURJPY. It printed it's ADR (160 pips) down there at 160.70 earlier in London traffic, having notched the high of the day (so far) during early Tokyo action.

If you take those kind of observations into consideration, then it might just focus you in on any price action triggers setting up theareabouts? Again, especially if price is printing it's ADR on & around a key s&r zone.



Hi Pipcrawler,

Hope things are good with you guy's on the site. Happy new year to all you admin/mods!!

[jlmac27]

You always seem to amaze me with your way of putting things,and your knowledge of course.Thanks again for you insight.

[Tess]

Today's early action on the EURJPY is quite a good example of what the prev couple posts on here have been alluding to.

Recall back to late last week we were discussing the near term positioning of this instrument & the trend/flows?

We earmarked our s&r levels & mapped possible math (Fib) based retrace zones in conjunction with price based s&r markers which the players had adhered to. (look back at the prev charts).

This morning those levels have once again played out.

Given the monthly flows are to the downside (1 & 4 hr charts), & we've witnessed a couple decent rejections of this near-term 161.50 upper line already last week, I guess the psychology of the players remains to the downside until this upper level (161.50) is breached & re-tested, yeah?

So, if the bias is 'short' then we wait until that level is approached & then wait for a possible reaction/trigger to take the low(er) risk bet & run with the flow.

mustang has mentioned that he's found the James 40-100pip thread very beneficial when used in tandem with some of the content of this thread. Utilizing the concepts of s&r, Fibs, trend theory & trader psychology from here, with the trigger elements of the 40-100pip thread (inside-outside bars & stochs confirmer etc), decisions ought o have been reasonably clear into early European trade today.

2 IB's were visible this morning on the EURJPY as price bounced off the 161.50 resistance zone, offering a low risk entry into Monday's activity.

An entry at c161.10 off the 6.45am bar or c160.93 from the 8.30am bar offered shorting opportunities for the early bird participants.

A test down below of the supports @ 160.50 hasn't really threatened the early morning shorts. Partial encashment (down at support) has enabled you to book some profits whilst maintaining your positionby placing the remaining stakes at the b/e.

You're running with the flows, in line with the higher timeframe trend & executing the lower risk option.