Kumowizard
Short

pros and contras before FED

FX:EURUSD   Euro Fx/U.S. Dollar
957 20 15
Weekly:
- Ichimoku still has longer term bearish bias, but due to correction from tripple bottom, the momentum is gone again, and Price popped up to change picture rather neutral.
- Heikin Ashi candle is bullish , but again we have to be cautious with haDelta around zero!
- First supp/res reached at Tenkan Sen = 1,10+. Next and even stronger key level is the 1,11-1,12 area, which is also supported be long term bearish trendline
- EWO is still bearish . Long term picture will only change if Price closes above at least Kijun and EWO changes to green!

Summary: Weekly is still in a wide sideaway range, with neutral-like Ichimoku and short term bullish bias, however price reached some key supp/res.

Daily:
- As I pointed out several times, the market was expecting way too much from the ECB based on multi weeks BS-ing from the biggest taling head ever called Mario Draghi. The serious and dumb overpositionning caused extreme short squeeze, and let me say this was a normal reaction.
- Due to multi wave spikes in price, Ichimoku picture turned neutral: Thick Kumo shades Price ahead, Chikou Span hit past candles, Tenkan and Kijun closed in to almostv make a weak bullish cross.
- However Price reached a support/resistance level marked by 1,1030-1,1090 zone! This should block further gains, especially ahead of FED rate decision, which I am almost sure will bring the long waited hike!
- Heikin-Ashi candles are bullish , but after a print at extreme high haDelta already signals negative divergence!
- Price will likely test 1,08 (-) area before FED again.

Summary: If you followed me and my trade idea, this counter trend long worked extremely quick and extremely well. But I think until next week we are pretty much done. It is time to book profits and stay neutral... or maybe sell some to 1,08 +/- tgt             .

FED I think WILL hike! They don't have any other choice. The question is how much will they do and how will they communicate. But it is too early to bet on this! You have to cross the bridge when you get there. Yes, it is possible that after FED EURUSD             will spike again and will go to 1,13. That is also possible that next year we reach 1,20+... why not? But can you play these scenarios now? Of course you can not. You can play this setup, when there is a setup!

* * *

I have to share some other info here with you: I've been working on my own for the last 4 years! I was not employed by anybody, and I really enjoyed freedom and independence (self-dependence :-) ).
However lately I had an inquiry for a really challenging and interesting position from a company, in which I think I only have an upside. After 5 months of negotiations I accepted the job from 1st/December. This means I will have a lot of business development tasks and duties as a chief economist, so from 2016 probably I won't be as active here on Tradingview as before. But I will still publish major ideas. So you can still keep on following me, and gove feedbacks, which I really appreciate!
I also suggest you to follow me on Twitter, where I will likely post a bit more.
Also if anytime you have any requests, questions, or ideas, you can always reach me via Twitter @Kumowizard or e-mail me to kumowizard@gmail.com.
moashiman
a year ago
Congrats for your new challenge. Beste of luck! :)
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Kumowizard PRO moashiman
a year ago
thank you!
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SolidSnake
a year ago
great insight I hope we see you here more often although congratulations for your new role :)
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Kumowizard PRO SolidSnake
a year ago
thank you! will do my best! monitoring markets and building investment strategies will be one part of my new job too. This method and my success with the trend following system was something the owners of my new employer started to like and respect. They do not understand it, they do not want to learn it, but they want to participate and take advantage of it :-D
I will certanly post here as well. So keep in touch!
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jukilo2000
a year ago
Good report ... a question but if the Fed will raise rates as is very likely, does not believe that the euro dollar may reach new lows? thank you
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SolidSnake jukilo2000
a year ago
Fed WILL raise it because they have to do some kind of movement after so much hawkish talk, the question is not, will or will it not happen? the question is How strong will this be? a raise <50bp is already priced into the market although there will be some initial euphoric movement, anything >50bp would be very strong and could drive the EURUSD to parity pretty quickly as new short positions will come in. One scenario I can see is that many positions are already into the market short of the Euro so if the FED disappoints like ECB did... those positions will get unwinded and you know in Forex you cant just cash out, when you close your position what you do is buy back the other currency (if you are short) so that means institutions buying back Euros = less euros available in the market = increase of Euro price. which could send the euro back to the 1,13 levels very quickly and from there... we shall see :)
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Kumowizard PRO SolidSnake
a year ago
please read my comments below! everything is possible. But you can not forsee the future. You can ride present waves, and if you ride them well, that will lead you to reach a pleasent future, regardless the outcome of the future. :-)

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Kumowizard PRO jukilo2000
a year ago
it is always a question of what has already been priced in, what are current expectations, and how the expectations change in time!
Look back, how long have this market been trading on the diverging monetary policy! It's been a bearish trade since 1,38 and especially since the break of 1,32!!! That is more than 1,5 years! Meanwhile FED hes delivered NOTHING so far!

The other point is, do u really think US economy can recover on its own, while EM, China and Europe goes deeper in trouble and economic meltdown? I doubt. So FED may hike now, or maybe once more. Mayve they just hike once now, but talk a bit hawkish later. But for sure at the point when the SP500 correction arrives and market melts down to 1650-1725 (see my other post about SP500), they will cut rates again to zero, or negative or will do QE4!

However this is just thinking and popping ideas. The fact is none of us knows what will happen fundamentally. The other fact is, that the charts and the price action will tell you and us exactly right in time when picture changes, and what to do! So try not to get worried too much about the future!
As Abraham Lincoln said: "Best way to predict the future is to create it"! You can not guess the future with sufficiently high probability, but you can trade the present that leads to the future with a trend following and price action based system with high probability!
Up to you which way you chose :-)
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SolidSnake Kumowizard
a year ago
I think you also have to factor in that the USA has learned a new way to make their economy stronger... since the Iraq war and now trying to go after syria's oil wells and refinery, its the good old method of invasion just a bit more sophisticated this time, they dont need of China and Europe as much as they used to, only the financial industry, the rest is all about building up their reserves and wait for the comodity price to increase then Whoala! your GDP goes up and you suddently become the ritchiest country in the world, this is only a preparation to the show.
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Kumowizard PRO SolidSnake
a year ago
this you say I can not agree. Just one example. Guess where more than 50 % of EPS of US large corporations is coming from??? Answer is: EM
I don't wanna go into fundamental details, but I could tell you at least 5 reasons that point towards a meltdown in US economy and possibly limit upside in equity markets from here
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Kumowizard PRO Kumowizard
a year ago
Also just think about globalisation. If 3/4 of global economy is sufferring, US can not make it on its own. It is like 1 cyliinder can not efficiently drive a 4 cylinder motor block. Eventually the whole machine suffers.
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SolidSnake Kumowizard
a year ago
I agree with you there, I am not saying USA will make it on its own I am just saying that there is more than the eye can see
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Guys! I highly recommend you to watch a fascinating movie (film): "I am" (2010)
It will help you think different and detach your thinking from too heavy speculation. Then you will value your money made in a different way. Also you will learn how to help others with your success. Believe me, you see making money is hard job, but not impossible. What makes it beautiful is that how you use the money and knowledge to help others too! Making millions of dollars won't make you happier. Feeling "Excitement" doesn't equal to feeling "Happines".
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RJHumphries PRO Kumowizard
a year ago
Hey is this the film you recommend?? Always like a recommendation https://en.wikipedia.org/wiki/I_Am_(2010_American_documentary_film)
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RJHumphries PRO RJHumphries
a year ago
Must be the right one!! Thanks for that Kumowizard a really powerful film
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Congrats on your new challenge! Your insightful (and often amusing snarky :-) commentary will be sorely missed. Will follow on Twitter.
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Kumowizard PRO FluidicFX
a year ago
thank you!
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fash
a year ago
Hi Kumo, just wanna say thx for all your posts and analysis, u got me interested in Ichimoku and I have learnt to incorporate it into my own trading from your charts. U will be missed, thx for everything and good luck with your new job.
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Kumowizard PRO fash
a year ago
Thanks a lot. As I said I will not fully disappear :-)... especially that even my new position will be a bit related to financial markets. I just mean probably the activity will be less. I wanted you all to kow it, not to believe that I got hammered by market or took an exit, just because I'll have fewer posts :-)
For me this tradingview thing is extremely important. You see I never channelled this activity towards a pre-payed subscription business. It is a hobby for me to help people if possible.
And honestly I also had one more selfish reason behind these posts: I wanted to show the TRUTH to some IDIOT FCKHEADS (if they ever read this they will know who I am and who I think of) who has been questionning me and my concept, and my 10 years+ real success. I wanted to show them this stuff together with a solid risk- and money management really works and makes a lot of money! But of course those idiots will remain same envious, jelous, spreading sht rumours :-D
Never mind. You guys who have been learning, and trying and making lot of efforts to become consistent and disciplined traders and follow me or some others for this reason, you can all succeed! You will have good times and hard times. I still have mine too of course. But if you walk the way of consistent trendfollowing, you will grow and you will reach awsome things! Which I hope later you will use to help other people, not just novice traders, but also the poor, who will never have the chance becoming a trader like you, even though they might be as good as us.

Keep in touch!
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Kumowizard,
Thank you for your sizable contribution to this community. I have been following your commentary and insight for awhile now and have enjoyed and learned from your point of view. Your 'day' job is lucky to have you. Congratulations. Looking forward to your commentary in the future, it will be missed here.

Trade well.
Respectfully,
ShirokiHeishi
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