possible uptrend continuation, target triangle hight, stoploss below previous lows
Comments
ForceFollower
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I agree, the bulls haven't given up on this pair yet. However, if you zoom in more closely, you'll see this ugly long, red candle, which is somewhat deterring me from entering at a high price. If I was going to go long once again in this old up trend, I'd give it yet another try at a stronger support level, which I find to be at 1.8348 (just below your thick green arrow), with a stop below the low at 1.8278.
Furthermore it is worth taking itno account that you want to short the GBP against the CHF (which I agree with) as the sterling has recently been relatively weak (weaker than the USD, but stronger than the CAD). The CAD is actually the last currency that is weaker than the GBP; all the others got the upper hand. But this ccy is currently oversold, and the momentum cycle may be a factor that will weigh on its strengthening in the coming trading hours, so the lower support level should hold at least in the short-term.
itaskar
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hi Piotr, can you send my any link where can I find something USEFUL about crosses, which pairs are not good to combine..or your personal view :) ..or should I check just the correlation?
ForceFollower
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Well, it depends on your strategy. All I can help you with is exactly how I trade, and I don't know if it's going to fit you. However, if your preferences are pretty much like mine, just go long the strongest currencies and go short the weakest currencies. Then find the best crosses between the two.
For example, you can determine the relative strength of a currency by analyzing the charts of their futures charts, which are the chart of the euro, US dollar, the Canadian dollar etc. Check out these major currency futures charts first, here on tradingview.com: E61!, DX1!, D61!, B61!, A61!, N61!, J61!, S61! and let me know, what you think.
itaskar
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thx, it looks CAD and JPY are the weakest for now, and will go lower, AUD is down, but is growing
ForceFollower
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Very well, now try to focus on the ccies that you have very little doubt in.
OK. I agree about the CAD, however I find the USD the second weakest. Now, what's the strongest?
itaskar
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from 1/2014: strongest first NZD,AUD,CHF,EUR,JPY,GBP,USD,CAD
from 6/2013: GBP,EUR,NZD,CHF / AUD,JPY,USD,CAD -in this longterm are not so big differences in stronger group neither in weaker group.
Mirandole
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Thanks for your analysis :)
itaskar
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It's based just on visual feelings :)
itaskar
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so what can I do now...for example..I think that JPY will fall down(triangle target not yet reached) and I will choose stronger ccy, AUD(at this time), and there is bigger possibility for longs...thats the way you are using it?
ForceFollower
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Well, it's taken me half a year to develop a strategy based on the ccies' strength. It's not such an easy thing. I do not rely solely on the charts I showed you. What I do is I export the 28 pairs' price and selected indicators' data from MT4 to Excel every hour. Then I have macros running in Excel that import the data, process it and archive it. That's how I get refreshed reports on what ccy is the strongest, which is the weakest, which pairs are on my watchlist and which pairs should be taken off. That's why I trade only the currency pairs' markets. I don't know anything about the other financial markets.
What I showed you is the way I go, but the very tools I use are far more complicated and self-made to share publicly. However, I will do my best to help develop your strategy with your own tools.
What is worth mentioning is that I found that the long-term strength/trend matters more than the short term-strength or trend. Until they fall out of balance, reach certain inflection point, after which the relation may be inverse.
What matters are both the strengthening, (the tendency of a currency), and the fact of the current level of relative strength. And I focus on the strongest pairs sorted by the relative strength of their currencies. For example, currently the four strongest pairs are: NZD/USD EUR/NZD AUD/USD EUR/AUD, because the strongest ccies at the moment are: NZD, AUD and the weakest: USD, EUR. But I specialize mostly in the first two of them, the best two. I collect stats on them and my strategy is only following their trends. And what is also a valuable information is that those best ones, even after they stop being the best, still keep on trending for some time.
So your findings are pretty much consistent with mine. JPY is neither strong nor weak now, I disregard it now. Long NZD, long AUD, short USD, short EUR. That's how trade now
Furthermore it is worth taking itno account that you want to short the GBP against the CHF (which I agree with) as the sterling has recently been relatively weak (weaker than the USD, but stronger than the CAD). The CAD is actually the last currency that is weaker than the GBP; all the others got the upper hand. But this ccy is currently oversold, and the momentum cycle may be a factor that will weigh on its strengthening in the coming trading hours, so the lower support level should hold at least in the short-term.