Kumowizard
Short

EURHUF attempts a bearish reversal

FX_IDC:EURHUF   EURO / FORINT
71 5 2
Who cares about zero carry any more? Direction matters, that's it.

This post is a follow up to my earlier warning today on Twitter.

Weekly:
- The ccy pair did not match the criteria of bullish Kumo breakout in last few weeks. No higher high above Kumo.
- Heikin Ashi is about to make a reversal pattern (of course end of week will matter).
- Chance for a double top is increasing.
- lower supp/res level and possible pull back tgts: 309 / 307 / 305 / 301 (as ultimate trend support)

Daily:
- Ichimoku setup turns back to neutral, Price attacks Kijun, 100 WMA and flat Senkou B line
- Inner trendline is broken, lower trendline still acts as supp/res ard 310
- Heikin Ashi gave a sell signal yesterday, the signal is validated today.

The bias is increasingly bearish , but we don't know wether or when it gains more momentum . Coming days will be very important, as FED decision may affect USDHUF             which is trading ard critical last support of 276-277, and on Friday S&P             will publish rating of Hungary. After 4 years spent in "Junk" category an upgrade to "investment grade" is not impossible.
yeru PRO
a year ago
Hi! My Q is: what is your price level recommendation on opening a short position on EURHUF?
Reply
Kumowizard PRO yeru
a year ago
Actually I already sold quite a lot at 314+ avg and bought 4 months risk/reversal put options (zero cost). So far the outright sells were profit taking on a massive size long position I've had for a long time. The Put option structure is my bearish EURHUF exposure. I am looking to add now to outright shorts possibly in 312-314 zone. If it breaks down, I won't chase it, I will wait for pull backs. Recently it had quite low volatility, but traded in an annoying range, but we must be careful as normally this pair is very stupid and volatile, not so liquid as majors.

All in all I would like to tell you it is not the level that really matters. If you see a good risk/reward signal, you have to sell it anyway. The question is how you size teh position. If you fee it may spike a bit higher, then don't sell too much now, just sell 1/3 or half of your planned size. Risk management is the most important, especially in case of these less liquid products. Xou have to know what is the level to stop, the level wher your idea proves to be wrong. So take that and volatility into account, and of course the amount you are willing to risk on this single one trade.

Btw, few days ago I sold some at 313,85 avg, but I was defenately too early, as the signal was not clear: there was no lower low on 4H and price did not break below daily Kijun Sen. My stop was at 315,40, of course I was taken out. Next day it started to move lower. So I started to re-enter again. Sh*t happens sometimes, but you have to know your risk, your limits, and get back into the trade again if you see a more reliable signal.
Reply
Kumowizard PRO Kumowizard
a year ago
I just checked 4H timeframe for you. Try to build it up in the 312,10 -> 313,50 zone.
Reply
yeru PRO Kumowizard
a year ago
Thanks! I do wait a drop down to 305-307.50 zone. We will see what happens on EURUSD after FED this week this could also has an impact on this ccy.

"Chance for a double top is increasing." What do you mean on this?
Reply
Kumowizard PRO yeru
a year ago
If you have a look at the Weekly chart, I marked it. In case the neckline around 308 will be cleared, that confirms the double top, with possible downside tgt ard 300-302.
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