This is for the August and September.
Lol, it looks accurate because itās all in the past, Rookie. I think any technical analyst can do that (curve fitting their analyses for past behaviours). Be advised that my analysis on JPY is still an [B]observation[/B], and that [U]I may have curve fitted my analysis[/U]. I havenāt defined exact rules for this. But then again I loathe defining rules. I view trading, after all, as an art. And there can be no exact rule for an art 
Hey guys.
Iāll get out to you the before and after, for GBP. But, Iāll have to wait a little while for the after (10-15 min).
Ok, so here is a shot at 0820.
Hi Technical Department (most likely Peter and Philip),
do I see it right that S&P 500 daily chart and 1H TF both shows a bullish price sentiment? On the daily there is even a know pattern, I checked it, it should be a morning star.
I know I still did not answer the other posts yet, I will do my best.
Besides that, USD makes some nice progress; GBP does not. I closed some 3 weeks old USD trades to lock in some profits before NFP report, the others will remain open.
FE
FE,
Yeah, I see that star thing, Iād say you could be right re a buy, but it is not for me - if price was around 109.30 and the DJIA was maybe 16570 / 16350 Iād feel happier.
Since you are talking TA, I see a sloping trend line up on both DJIA and S&P Daily.
Iām trying out a system on the US stocks, have to get a demo a/c first to see if this thing works.
When I get it up and running Iāll give a little report.
Well its a bit complicated FE imo so Iāll lay out all the possibilities and then give you my take. It is a classic sign of an end to a downtrend, especially that it had the highest tick volume of the entire downtrend. That on its own is a very profitable buy signal.
However since the downtrend has just started, it could also be a pause in selling. The SPX500 will move sideways for a number of ways before resuming a downtrend.
My personal take is that there will be no new swing low, for three reasons:
- The reversal candle with high tick volume activity is a sign of starting a mark up (mark up is an increase in price, usually rapid)
- Price has just crossed the 100 Daily moving average, so this looks like a classic case of a fakeout.
- The candles closed at around the .618 retracement of the latest upward move, which is the key level for retracement usually or according to Elliot anyways.
So we have three classic and very good examples why the downward move is finished. What we need to see now is a daily green candle to confirm that sentiment. If that happen, the worst that could happen is to see price move sideways for some days before moving up.
The absolute confirmation though is price moving back up the 100 MA, that is an entry signal to buy actually.
It is also important that price does not create a lower low, that would invalidate the analysis.
Hi guys,
Mike,
hmmm unfortunately I knew without the report where GBP, NZD and AUD stands. Exactly the opposite side where I would wish it to be. What did you drop 50%? I hope your winnings and not your balance! I was worrying in your first post as you did not say we should talk to me. It might sound funny, but reading in your post that we should talk to you and the small coffee signal is just now a part of my day. If I see it, I know you are doing ok. It is like an automatic answer for the question How are you? So when it is not there then I do not know what is happening.
Philip,
I think slowly I know every person here. I wrote last time: you and me are the one who unfortunately have to much passion for trading and always have to be in it, Peter and rookie are conservative and flows with Mike are disciplined like stones. This lines up with your post yesterday when you wrote that you will not trade anymore this week. Since that, it was the second post from you sharing with us your new trade idea or entry! Awesome! We really have to work on discipline. My USD trades are advancing great in the last hours. And I just got your post on the technicals. Thanks a lot, I appreciate it! It was just a perfect analysis; I have to work on that for sure. I need one more help. You write in the beginning: āit had the highest tick volumeā. Can you please describe what exactly that means and how do you know that? It is funny that you mentioned it as rookie wrote about volume the other day.
Dr. Rookie,
good writing as always. I have to say though for me it was a bit more difficult to follow. And you did not write a conclusion, are you still bearish? I am. I agree what you wrote on COT, but we should not forget, as Williams always said, it is not a timing tool.
Peter,
well Services PMI came out negative, it looks like everything is against the GBP this time. Thanks a lot on your opinion about technicals. I always like to hear what you bring up, sometimes correlations that I have never thought of. I think we are all waiting for your findings on stocks as we do not trade it and it would be good to have some knowledge on stocks as well and we can use that to our advantage with currencies.
Flows,
yeah, I go through on the babypips.com school about COT on the weekend once more if I get the time for it. Then I can discuss it with you. But still, I do not have the data so I cannot spot the extremes. The rules you write down I do understand because we use the same for specs and comms. My problem is that I do not understand the logic and then it is hard to use. I do not know how can we just take total net positions and then subtract specs from comms. This is a big mess in my head. I try to clear it on the weekend. I thought you also started COT in May. If you have data from January, it is still less than the 3 years we would like to use, but it is a lot older than the data the others (including myself) have. We started to save and work the data in May. With JPY I am also coming to an extreme maybe still this year, just post when you think we are on an extreme. We discuss these things on the weekend. What I do not get in your charts is that as I see the yellow line is not on an extreme level but according to you it is. So actually what is your view then on JPY? How do you see it? The charts are visual, I like them, and your letters style remind me to elementary school. Wow it was a long time ago.
After thinking about it, the reasons lined up to enter S&P with a not big SL. I think it is a good reward to risk. I cannot lose too much but win significant if it works.
Once more, Philip your technical analysis was great, regardless if it works or not.
And now starts the forex.com webinar where they are likely to post a live setup for NFP and live discussion of it. For those who are still in the market: good luck!
You go to Metatrader 4 indicators and insert volume. You will see a bunch of lines or bars appear below each candle. Those lines/bars indicate the number of ticks per candle. The idea is we are in for a reversal when a small candle gives a huge tick. Think of a downtrend like a guy falling from a tower; the candles represents how far the guy is falling and the tick volume represents the power behind that fall. When suddenly the length of the fall decreases (candle size) but the power gets even greater than at any time during the full, one thing can be interpreted; There is a hero who has stepped up and caught the falling guy and is trying to save him from falling further, even though the guy is not falling as much as he was before, the hero is spending a huge effort in keeping him from falling further. Hope this clears it up.
Well my system is based on the interaction of US10yr v sGold and S&P/DJIA
All very early days, I havenāt even got a demo a/c yet, but itās telling me to buy S&P at or around the NY open.
(I have no intention of doing so, but itāll be interesting to see, I actually hope itās wrong so that I can work on filters)
Hi Peter,
just a quick observation: why is GBP moving up on the initial reaction of the NFP? I asked the analyst on the webinar, he does not really have an answer on it. So I thought I ask the person knows actually quite a lot on GBP pairs.
Actually this NFP is a christmas present at the moment. I do not know how it will change or how the follow up move will be, but exactly GBP and USD are moving up. Not even mentioning S&P!
FE
EDIT: my earlier fear comes true as GBP is being faded everywhereā¦
Iām guessing you are ref GBP/JPY - thatās because of USD/JPY - buying of USD this is causing selling of JPY, thus GBP/JPY rising (not really that tradable, - your EUR/USD is looking good, this will pull GBP down with it.)
Well Iām keeping an eye on USD/JPY and the 110 number, a break of that, to me anyway, means that the USD pull back is over.
The only thing I note is the gap back down at 109.00 , I wonder were there missed buy orders there and are they still waiting - just a thought.
One other thing, Iām not a full time trader, this is my only hobby - so it is important to remember most of my musings are just that.
Lol, sorry about the font. I just like it since it feels lighter, I could use the more formal fonts if you like.
Yes, I too am struggling with the logic behind it. Thatās why I prefer to observe it first, see how it fares. Maybe if I observe it long enough, Iāll know. If not, thenā¦ Iāll use it anyway. Lol, my thinking is simple. If I use it long enough, Iāll certainly develop a feel for it, knowing when itāll work and when it wont etc. Itās like Iām having a I-donāt-need-to-know-how-they-make-cellphones-as-long-I-can-use-it attitude (lol, I hope you get my point).
And about whether or not weāve reached an extreme, this is why I said it was more like an art, and I found it hard to define the exact rules to trade it. Well, take it from my charts of JPY in March, April, and June for example. The extreme of 250,000++ has not been reached, but the index has bounced from there. Now the question is, am I going to ignore that bounce since it hasnāt reached the extreme of 250,000++? This is certainly a difficult question, especially if we are selling JPY because weāll be kind of expecting it to reach 250,000++. But as it unfolds, those are indeed an āextremeā, in a sense that there is no higher number than those in the next coming weeks.
Cheers,
PS: Oh, and I share Peterās sentiment. Iām just a hobbyist trader, so itās all maybe just me getting creative in my sleep 
Hey fellas!
Well, itās Friday close to US closing. Iām still at work now, but winding it down. Will be leaving kind of shortly.
I just wanted to give you guys a final (well almost) tally to the trades.
So now it is 1947 GMT.
EUR/GBPā -16
GBP/CHFā +9
GBP/JPYā -239
GBP/NZDā -348
Total pips = -594
Well, I guess we canāt win them all.
(phew, Iām glad it was on my play account)
I am glad to see today the NZD did start going down (for real this time). Iāll have to give you guys an update on my real trades for the week. Did not look good earlier, came back some though. But I do know Iām down some.
Tomorrow morning at 3am (my favorite time of the week) Iāll get to working on the numbers for the week. Then shoot them out to you all, hopefully around 6 to 7am (10-11 GMT) sat morning.
CANāT WAIT!
See ya soon.
Mike
Hi guys,
Flows,
Donāt change your letters. I like them. Not the boring times new roman always. I am waiting for your new analysis. Even if you only trade GBP/USD, please share your findings and which currency you find strong and weak.
Philip,
good writing about volume. Thanks. Do you know how is it actually measured in MT4? Because actually volume is measured in forex only in COT report. I liked the example too.
Peter,
I only closed my USD/JPY long after the rally at 109.86. I did not want to go down with it. I like your idea, I will also put a trade on long USD/JPY for a breakout play.
Mike,
thanks for the numbers, please save them in your analysis. It canāt be always good. But as you say, the fall stopped and hopefully will turn now.
Guys, after all my week did not turn out as bad as I thought! Actually I did come back. Not with pips but with $$$. As I said earlier my USD trades have larger size than GBP. USD skyrocketed today, GBP also rose a bit and look at the S&P chart! Largest daily gain for S&P this year since March. It has only to do though with good reports but geo risks escalate in Hong Kong, Ebola is not getting better and Syria does not look good either. So I already put SL above my breakeven. The index has still time to rise but I do not know if conditions are good enough. At least the entry worked this time. The USD and GBP trades are balanced as I said, pip numbers are negative as GBP has larger negative pips than USD but the position size balances the more lost pips on GBP. I only closed the USD/JPY trade in the afternoon, other USD trades are above 100 pips (in the morning I closed 3 other long USD/JPY trades. I had way too many open, wanted to lock in some hundreds of pips).
I am happy that Friday changed everything, last night it all looked a lot worse. As the title says, I am happy it did not turn to be a black Friday and some rise came after the dark days.
We had an interesting week, we have something to analyze tomorrow. Good night everyone
Just in case any of you happened to miss this little piece today:
Euro zone retail sales much stronger than expected - RTļæ½ News
[B]A Closer look at NFP [/B]
Restaurants and supermarkets were two of the biggest sources of job growth last month. Food services and drinking places added 20,400 jobs in September. Food and beverage stores, meanwhile generated 19,500 positions. The growth helped push the unemployment rate to a six year low of 5.9% last month when US payrolls added a total of 248,000 jobs.
Donāt be fooled by the headline number things arenāt all rosy just yet if we take a closer look. While there was a creation of plenty positions retail and restaurant jobs are usually lower wage and may not be full time positions. Average hourly earnings were little changed in September at $24.53, and earnings for production and non-supervisory employees held at $20.67. Even as the unemployment rate improves wage growth has remained sluggish in the U.S and participation rate has dropped as baby boomers get out of workforce.
What would be a favourable scenario for market watchers is rising participation rate along with falling unemployment rate. That would give the indication that the US job market is on its way to achieving stable consistent growth. That so far is still out of the picture and the September payrolls data was somewhat mixed.
As for inflation investors expect inflation to average 1.61 percent over the next five years, down from 2 percent at the start of August. Raising borrowing costs while inflation is low would hold risks for the Fed by putting more downward pressure on prices at a time when their tools to stimulate the economy are limited.
Chicago Fed President Charles Evans said he favors holding the federal funds rate near zero until the first quarter of 2016 to ensure that the economy is able to withstand higher borrowing costs.
Hi Peter,
How did you come to this conclusion? Teach us please COT report also shows that JPY reached another extreme on Sept 30th, causing a top at USD/JPY.
So, letās see what the COT Report tells us this week. Very important that the percentile factors and net positions will always show the non-commercial speculators vs. data from the previous week:
AUD: 48.85% current vs. 54.85% previous. Net position: - 2 017 current vs. 8 347 previous. It is large difference in net position change. In the short history since I follow the report (just like with the NZD) we are on an extreme level. Altogether it is not an extreme however; there is plenty of places for further fall.
CAD: 46.76% vs. 52.93%. Net position: -4 566 vs. 3 064. Although specs got a lot more bearish, price action was very mixed and positions are far away from any kind of extremes. There is a reason why we stayed away only from this currency.
CHF: 32.82% vs. 27.76%. Net position: -12 557 vs. -13 375. Although Specs got a bit more bullish, my view is still bearish.
GBP: 51.71% vs. 49.51%. Net position: 3 589 vs. -1 050. Although we see a bullish signal here for net position but we have in mind what the last three days of the week meant for the pound. And these three days are not in the reportā¦
NZD: 50.15% vs. 55.19%. Net position: 64 vs. 1 841. In my short history of following the COT, this is an extreme short reading. As I have open short positions, I hope we are not at extreme levels. As I cannot use Oanda today and timingcharts.com does not have NZD (still do not know why), I wait for your analysis to see on what level we are.
EUR: 24.68% vs. 23.03%. Net position: -137 525 vs. -141 965. Here we see the biggest difference between price action and net position change. Specs got a bit bullish but as we know price has fallen. In the last three days price got some support, but these days are not included in the report so here we see a divergence. As Peterās analysis showed, the key might be the strong support zone in the EUR/GBP pair.
JPY: 16.55% vs. 17.50%. Net position: -120 878 vs. -105 422. We are heading to the extreme level. More than that, looking at price action, I tend to think that more pairs have already reached the peak. I hope it is not the case with GBP/JPY where I have two open positions. USD is getting stronger continuously vs. JPY but USD is maybe not the very best indicator for the current JPY as USD is stronger than all currencies.
USD: Peter gives always an update on the current situation, as I remember he wrote that reaching the 88 or 90 levels are in the cards.
XAG/USD: as you guys all know, I pay very special attention to this pair I was want to observe closely the first big reversal. Price has fallen once again, but Specs and Comms fell once more short to the extremes (both for COT index and for net positions). We have to keep in mind though that Friday price has fallen once more, which means we might be there or very close to it. I will watch price action very closely every day as I want to be in this rally. XAU/USD price has fallen too, but it is not that close to an extreme reading like silver is. Crude oil is also falling like a stone but an extreme reading is far away from the current prices. I add to my watch list the USD/MXN setup. We are getting to an extreme level soon. Chart action confirms this view. As we know the current situation with exotic pairs, it is important to mention the USD/BRL too, as it is also on an extreme level soon. This pair will not be observed though as my broker does not offer this pair to trade. And even if it was, I suspended myself from trading exotic pairs anyway (on the other side I said I only trade pair from the COT report and it is in the report included!).
Unfortunately the Oanda site has maintenance today so I could not confirm my findings there.
Trade setups for the week:
Well guys, this week I do not provide any setups, neither rankings between currencies. I take a step back. I do not want to make fast decisions this time. There are many things to think about. I have many long-term open positions, I want to manage them. Especially I do not want to open many positions as in the following two weeks I have a lot to do.
Still, I share my opinion on how I see the market. On purpose, I did not read today the thread so nothing can influence me. My overall view has not changed, but as we got a GBP hit after itsā rally, I will leave open my AUD and NZD short trades but do not open new ones. The charts look like the GBP charts and we know there was a significant retracement. In AUD and NZD pairs there was no retracement until now so I will be patient, but leave my trades open as I do also not want to be out if the move continues. I rather watch every day the silver charts. Besides AUD, NZD and GBP, I will pay attention on JPY as the extreme levels are not far away.
I wish everyone a good weekend, more luck and pips next week and I will answer for all the posts of course.