Saturday, 14 January 2017

EURNZD at key pivotal level, breakout imminent

With EURNZD at a key pivotal level, a breakout is imminent. A short-term and long-term outlook on EUR VS New Zealand Dollar (EURNZD) shows that the bulls are all out and set to deal a heavy blow to the bears, in other words, the bears should be warned else, the story might be told by the bulls only on how the bear was given an outright  technical knock-out.
It should interest us all to note that eurnzd has met every technical requirement to commence a rally that should eventually break north. Earlier in November 2016, we had EURNZD placed on our radar to be one of our top pairs to trade for 2017 with potential for a massive rally, the journey has commenced and hence this piece should be an update to a party that is in its infancy.
On the weekly outlook of EURNZD, the  1.8686 figure was the peak and also a level which held like an unbreakable rock and has price topped out on sept 2015. Price has however remained under pressure for 69 weekly sessions. However, the bearish pressure was tamed by the falling trend line which was broken in June 2015 to the upside. This is the first time price has come that far to have this broken trend line tested. Still, on the weekly time frame, the whole decline from 1.8686 peaks is corrective in nature, formed a bullish wedge at the right shoulder of a wider inverse head and shoulders pattern. Moreso, an engulfing price action has been spotted on a key 76.4 Fibonacci retracement of the whole rally connected from the low of April 2015 to the high of September 2015.
VERDICT: Where precisely to seek for entries on EURNZD
For those who missed our first entry on EURNZD, an opportunity stick knocks on the door of those who sees the potential and ready to be well positioned for an imminent breakout that will be perhaps well pronounced in 2017 as our trade of the year. For fresh entries, consider 1.5000-1.4900 handle as a gift with our invalidation zone being slightly below the engulfing price action formed on the retest of the broken trend line at 1.4650. Our first target, however, should be the 100-day moving average value of 1.5900 for a whopping 800pips. The second target for eurnzd swing should be 1.6800 for 1,700pips in the second position. Our invalidation zone remains 1.4650

Tuesday, 6 December 2016

Euro defiles gravity after Italy vote.

Price action in the Forex market was decidedly more subdued on the second trading day of the week with most pairs contained to 50 point ranges for most of Asia and European trade.

The EURUSD which made a near 300 points round trip in post Italian referendum trade yesterday, first dropping to low of 1.0504 and spiking to 1.0798, was as much calmer today but remained near the two day highs and within striking distance of the 1.0800 figure. There was little data from the region except EZ GDP figures which came in at 1.7% versus 1.6%, but yesterday's price action suggests that the pair may have made a near term bottom and could continue to squeeze higher even possibly towards the 1.1000 figure especially if ECB President Mario Draghi offers no definitive calendar extensions to the QE program.

Ultimately the euro may be headed to 1.0330 as the policy divergence between the Fed and the ECB begins to kick in. But for now the market is still looking for the Fed to affirm its intention to tighten continuously in 2017 rather than the one-and-done December hike that is already priced into the market. Meanwhile if the EURUSD could continue as expectations are adjusted on both sides of the trade.

Elsewhere today, the RBA kept its rates on hold and generally provided a modestly upbeat assessment of the situation on ground, but Aussie drifted lower in the wake of the announcement as it was well anticipated by the market . Meanwhile, the Kiwi took a tumble in Asia dropping sharply below the 0.7100 figure after dealers pulled some bids ahead of the RBA announcement and a spate of spelling triggered a stop avalanche. The unit recovered somewhat in European trade but remains weaker on relative basis ahead of the Diary Auction results due later today.

With only US trade data on the docket, the focus of the market will once again turn to rates. If US yields could creep higher, USDJPY which has been well bid all night could make another run as the psychological key remain 115 level. However, another failure today, could prompt a more serious correction in the pair which has been overbought for days and will need continued support from fixed income market to push higher.

Oluranti Owolewa
Technical Analyst

Saturday, 6 August 2016

EURGBP a scope to accelerate further.



The big story this past week for cable was the Bank of England's decision to combine 25bp rate cut with 60 billion government bond buying program and also a new initiative to buy  10 billion pounds of corporate bonds. This of course sent a strong message to the market which drove sterling down against all the major currencies. The Bank of England gave more than expected because they felt by acting early and comprehensively, the MPC can reduce uncertainty, bolster confidence and support the necessary adjustments in the U.K economy. According to Mark Carney, the central bank felt that the outlook for growth had weakened materially since the Britain's decision to leave the European Union. In all, the Bank of England's outlook is grim which is part of the reason they felt the need to do more than market anticipated. However, the tone of Governor Carney's comments was not overwhelmingly dovish. The central bank is ready to lower the bank rate further if needed and increase all elements of the package but Carney made it clear that the lower bound interest rates is above zero as he is not a fan of negative rates. Carney sees helicopter money as "flight of fancy" and doesn't see a scenario where negative rates is discussed and as such, if they were to ease again, it would be in other ways and perhaps through additional bond purchases. Definitely before additional measures are considered, BOE would like to see the impact of the current stimulus in the economy. With that in mind, cable should still experience some weakness in days ahead especially against the crosses and one of such is the EURGBP.
EURGBP has a window to accelerate higher since completing a potential medium term correction at 0.6930, it's ironically following the same price action as Sterling's exit from the EMR in 1992 into the trend-line from 0.9800 high at 0.8115. This should ideally represent the first leg of a new uptrend. The corrective pullback to 0.7560 could well then have set up a potential acceleration to 0.8750 equality target. However, 0.8100-0.8300 consolidation should set a platform to rally again. However, a loss of 0.7995 would suggest EURGBP is still following the 1992 template with a break back down to 0.7500.

Saturday, 29 August 2015

John Murphy's Ten Laws of Technical Trading.

John Murphy's Ten Laws of Technical Trading.

Which way is the market moving? How far up or down will it go? And when will it go the other way? These are basic concerns of the technical analyst. Behind the charts and graphs and mathematical formulas used to analyze market trends are some basic concepts that apply to most of the theories employed by today's technical analyst.

John Murphy, stockchart's Chief Technical Analyst, has drawn upon his thirty years of experience in the field to develop ten basic laws of technical trading: rules that are designed to help explain the whole idea of technical trading for the beginner and to streamline the trading methodology for the more experienced practitioner. These precepts define the key tools of technical analysis and how to use them to identify buying and selling opportunities.

His most recent book demostrates the essential visual elements of technical analysis. The fundamental of John's approach to technical analysis illustrate that it is more important to determine where market is going (up or down) rather than the why behind it.

The following are John's ten most important rules of technical trading:

  1. Map the Trends
  2. Spot the Trend and go with it
  3. Find the Low and High of it
  4. know How far to Backtrack
  5. Draw the Line
  6. Follow that Average
  7. Learn the Turns
  8. Know the Warning Signs
  9. Trend or not a Trend
  10. know the confirming Signs
1. Map the Trends

 Study long-term charts. Begin a chart analysis with monthly and weekly charts spanning several years . A larger scale map of market provides more visibility and better long-term perspective on a market. Once the long-term has been established, then consult daily and intra-day charts. A short-term market view alone can often be deceptive. Even if you only trade the very short term, you will do better if you're trading in the same direction as the intermidiate and longer term trends.

2. Spot the Trend and Go with It

Determine the trend and follow it. Market trends come in many sizes - long-term, intermediate-term and short-term. First, determine which one you're going to trade and use appropriate chart. Make sure you trade in the direction of that trend. Buy dips if the trend is up. Sell rallies if the trend is down. If you're trading the intermediate trend, use daily and weekly charts. If you're day trading, use daily and
intra-day charts. But in each case, let the longer range chart determine the trend, and then use the shorter term chart for timing.

3. Find the Low and High of It

 Find support and resistance levels. The best palce to buy a market is near suppor levels. That support is usually a previous reaction low. The best place to sell a market is near risistance levels. Resistance is usually a previous peak. After a resistance peak has been broken, it will usually provide support on subsequent pullbacks. In other words, the old ''high'' becomes the new low. In the same way, when a support level has been broken, it will usually produce selling on subsequent rallies - the old "low" can become the new "high".

4. Know How Far to Backtrack

measure percentage retracements. Market corrections up or down usually retrace a significant portion of the previous trend. You can measure the corrections in an existing trend in simple percentages. A fifty percent retracement of a prior trend is most common. A minimum retracement of 38% and 62% are also worth watching. During a pullback in an uptrend, therefore, initial buy points are in the 33-38% retracement area.

5.  Draw the Line

Draw trend lines. Trend lines are one of the simplest and most effective charting tools. All you need is a straight edge and two poimts on the chart. Up trend lines are drawn along two successive lows. Down trend lines are drawn along two successive peaks. Prices will often pull back to trend lines before resuming their trend. The breaking of trend lines usually signals a change in trend. A valid trend line should be touched at least three times. The longer a trend line has been in effect, and the more times it has been tested, the more important it becomes.

6. Follow that Average

Follow moving averages. Moving averages provide objective buy and sell signals. They tell you if the existing trend is still in motion and they help confirm trend changes. Moving averages do not tell you in advance, however, that a trend change is imminent. A combination chart of two moving averages is the most popular way of finding trading signals. Some popular futures combinations are 4- and 9-day moving averages, 9- and 18-day, 5- and 20-day. Signals are given when the shorter average line crosses the longer. Price crosings above and below a 40-day moving average also provide good trading signals. Since moving average chart lines are trend-following indicators, they work best in trending market.

7. Learn the Turns

Track oscillators. Oscillators help identify overbought and oversold markets. While moving averages offer confirmation of market trend change, oscillators often help warn us in advance that a market has rallied or fallen too far and will soon turn. Two of the most popular are the Relative Strength Index (RSI) and the Stochastic Oscillator. They both work on a scale of 0 to 100. With the RSI, readings over 70 are overbought while reading below 30 are oversold. The overbought and oversold values for Stochastics are 80 and 20. Most traders use 14 days or weeks for stochastic and either 9 or 14 days or weeks for RSI. Oscillator divergences often warn of market turns. These tools work best in trading market range. Weekly signals can be used as filters on daily signals. Daily signals can be used as filters for intra-day charts.

8. Know the Warning Signs

Trade the MACD indicator. The moving Average Convergence Divergence (MACD) indicator (developed by Gerald Appel) combines a moving average crossover system with the overbought/oversold elements of an oscillator. A buy signal occurs when the faster line crosses above the slower and both lines are below zero. A sell signal takes place when the faster line crosses below the slower from above and zero line. Weekly signals take precedence over daily signals. An MACD histogram plots the difference between the two linnes and gives even earlier warnings of trend changes. It's called a "histogram" because vertical bars are used to show the difference between the two lines on the chart.

9. Trend or Not a Trend
Use the ADX indicator. The average Directional Movement Index (ADX) line helps determine whether a market is in a trending or a trading phase. It measures the degree of trend or direction in the market. A rising ADX line suggests the presence of a strong trend. A falling ADX line suggests the presence of a trading market and the absence of a trend. A rising ADX line favors moving avearages; a falling ADX favors oscillators. By plotting the direction of the ADX line, the trader is able to determine which trading style and which set of indicators are most suitable for the current market environment.

10. Know the Confirming Signs

Don't ignore volume. Volume is a very important confirming indicator. Volume precedes price. It's important to ensure that heavier volume is taking place in the direction of the prevailing trend. In an uptrend, heavier Volume should be seen on up days. Rising volume confirms that new money is supporting the prevailing trend. Declining volume is often a warning that the trend is near completion. A solid price uptrend should always be accompanied by rising volume.

"11." Keep at it. Technical analysis is a skill that improves with experience and study. Always be a student and keep learning.

-John Murphy

Tuesday, 18 August 2015

GBPUSD 1.7150 Long term Perspective...


Hello everyone and welcome to an important update on the Great Britain Pounds (GBP). Some few days back in our video update in the trading room, we talked about the GBPUSD carving out an important bottoming base and subsequently breaking out to the upside to challenge the 1.7100 handle where an aggressive momentum will be required for a final break of the said resistance. Speaking technically, GBPUSD is clearly bullish right from the monthly time frame down to the 4hr time frame in tandem. In the same vein,  series of bullish price action formations from monthly to daily TF suggests bears should be prepared to be on the run for some weeks or perhaps months to come. Looking at the daily time frame, an inverted head and shoulder is easily identified, which add credence to our bullish outlook which should eventually have its targets at 1.7150 for a 1,700pips from current levels. On the fundamental outlook of the Great Britain Pounds (GBP), the resiliency of the cable has been as a result of the rate hike expectations from the Bank of England making it investor’s second favorite aside the US dollar. Speaking about the US dollar, September is just around the corner and question running through the mind of all investors all over the world is, “is there really really going to be a rate hike for September from the FED? Well your guess is as good as mine but I’m a contrarian to a SEPT-HIKE but without much deviation, before concluding this short piece. I would like to state that 1.5200 remains our invalidation point for cables long which should turn focus back to 1.3500 as an alternate scenario targets if bullish view is invalidated. We are long already with specifics in our last GBPUSD video updates sent to our premiumHandle and we look to buy the weakness of GBP only as long as invalidation remains intact for a real ride.

Thanks everyone and for more of our swing trading opportuninties brewing up, do not hesitate to join our PremiumHandle for an unmatched trading experience.
Good luck.

Thursday, 6 August 2015

CADJPY Classic Head and shoulder has 1,978pips as targets

                                                               CADJPY WEEKLY TF
Hello everyone.
It has been quite a few weeks since we laid out our cadjpy trading plan both in the premium room and also in our whatsapp room. Its exactly six weeks now and we deemed it fit to inform everyone how we are managing this particular trade and the potential for further decline in weeks or perhaps months ahead. We initiated this weekly swing trade based on a few rational. First one being a several classical head and shoulder noticed on the weekly time frame and of course on the monthly time frame. Secondly, there was a strong bullish candle spike to a resistance area which was unable to breach the resistance of may 2013 and of course, that region completed the second shoulder of the weekly H & S formation proper. With series of bearish price action formation both on monthly and of course the daily time frame, we saw this as an antelope thrown into a lions den for a real devour, hence we pulled the trigger. Today, we are up 520pips and yet the real party ain't started just yet as we have the target of this weekly classic head and shoulder formation at 75.00 region for an outstanding pips of 1,978pips reward. That's a real potential move if you ask me. Oh well, we are moving our stops close to break even to lock in just 150pips because we envisage a corrective rally from this present strong support region to at least 96.00 region or more from where we would add to our existing position to hold for at least 8 weeks for some real handsome rewards......
 This is just a tip of the iceberg. We are watching three more weekly swing setups which will be added to premiumHandle exclusively in few days time. Take advantage of our PremiumHandle and let the team of forexinsaitz do all the dirty work for you while you relax and do the reaping of the pips. Also, join our group page on facebook ( for more details. Do have a pipful month everyone...

Thursday, 9 July 2015

#GBPAUD, a pause or thrust with 700pips for a pause!!!


Hello everyone!

This is the king with an exciting trade opportunity for you today on the GBPAUD pair with 700 points potential gain..

So lets get down on this just as it's hot. We have been tracking GBPAUD pair since January this year and believe you me, it has been really consistent without being partial in its' generosity. The GBP strength is matching perfectly with recent AUD weakness and the evidence of that can be seen with the recent 1,800 pip move on the daily chart. Momentum continues to build a very bearish divergence with every new high as can be seen on the daily chart. Most interesting part is the MAP gbpaud is carving out, which is fractally the most sexy thing out there ready for a 700 points before overall perspective is revisited again for our yearly, (permit me to use my mentors terms, EDMATTS)  FATPITCH trade. This short term bearish view is consistent with the short term top historical analogy  (1.9200) of  01-24-2014 for a 2,000 points correction before the larger rally, hence we are carefully short 2.0854 and 2.0710 for a 700 points correction with 2.1020 as stop out level while maintaining longer term bullish view.
That's it on GBPAUD special report from yours truly, the King.

To ensure that you don't miss other special trade opportunities, you can subscribe to our premiumHandle for timely swing trade calls or join our for an unbeatable pips experience.

Thanks for reading, have a great day!