Currency Pair - EURUSD Time Frame - Daily Scope of Tutorial - This tutorial will help to show how I trade the currency pairs using candlestick analysis. Part 1 - On March 30th EURUSD made a Piercing candle. A Piercing candle is similar to a Harami with the difference being the candle closed past the 50% mark of the previous candles' real body. A Piercing...
This chart shows the 4-hour time frame for the GBPUSD currency pair. The chart shows the price has moved down to major support and has bounced upward. The most recent 4-hour candle tried to move below the red horizontal Swing Level line but failed to close below it. A bounce off the swing level and a close above the high of the most recent candle will signal a...
The U.S. Dollar moved down from its 'Double Top Reversal Pattern' to mean value at the daily 20 EMA (green) on March 26. Since then, the dollar has moved below the daily 20 EMA, and the 20 EMA is starting to point downward; this is an indication the dollar is continuing lower. Note: The red moving average is a 60-period exponential moving average representing...
The U.S. Dollar is now above major resistance indicating an overbought status. The Dollar has also formed a Double Top reversal pattern. Further, the Dollar is extended from the daily 10 and 20 EMA's. When a market is overbought and/or too far extended from the mean value (20 EMA) that market normally returns to mean value. Note: The red moving average is a...
The U.S. Dollar is at the horizontal resistance zone. Price action looks to be rejecting this resistance level based upon upper candle wicks. As of today, there is no reversal candle indicating a reversal downward. The next couple of days should give us an indication as to the future direction of the dollar.
This is a counter-trend trade setup! Counter-trend trading is riskier than trading with the trend as the sellers could come back in at any time and price action could go against your position causing a small loss. For this reason, I like to use the 4-hour chart when counter-trend trading so I can more readily detect when the sellers might be coming back into the...
I have analyzed all the 'Major and Major Cross' currency pairs this weekend and I have decided to trade 'NZDUSD' this next week. However, since I will be trading this pair in a counter-trend trade I will be trading on the 4 Hour chart because of the added risk associated with counter-trend trading. The first thing I see on the 'daily chart' is this currency pair...
EURUSD has now moved below yearly support line S1 (black horizontal line) and monthly support line S2 (blue horizontal line); note red circle. In addition, Fridays Daily candle is below next week's "Average True Value" line; see the green horizontal line marked as P on the chart. With Friday's candle below "Average True Value" indicates the sellers are in...
The 'US Dollar' is currently up against a confluence of Yearly, Monthly, and Weekly resistance and has formed a 'Hanging Man' candle pattern. A 'Hanging Man' candle pattern is a 'reversal' pattern. The current combination of resistance from different time frames and a 'hanging man' candle indicates the 'US Dollar' may be ready to reverse directions and to start...
Today's candle moved close to my "Take Profit" price point, bounced upward and now looks like it may end up being a Doji, an indecision candle. With price bouncing off a price level near my "Take Profit" price level and moving back upward indicates price rejecting lower prices. As a result, I am now taking profit. With price so close to my "Take Profit" price...
As you will recall from my last IDEA post on this subject I had identified a breakout candle indicating an ideal price level to enter a "Short trade" (see link below for reference). Now it is time to identify a price level to take a profit. There are several different "Take Profit" strategies, in this IDEA post I will point out one of them. I will point out...
Moving ahead in time, I have identified the candle that broke out below the range of the candle incompassing the inside day candle and have identified this candle as the "Inside Day Breakout Candle." The inside day breakout candle indicates the price is ready to move lower. With price now ready to start moving lower, this is the perfect time to enter a "Short"...
In my last IDEA, I concluded with the following: "In conclusion, the last candle shown is a Pin Candle, so I am expecting the market to move in an upward trend in the days ahead." In this chart, I can see the market did move higher as expected. I also see the latest candles' high and low stayed within the high and low of the preceding candle, therefore, forming...
Once I have completed my top-down analysis (Monthly and Weekly), I have now moved to the daily chart to look for trade opportunities. The first thing I did on the daily chart was to highlight the last five trading days representing the latest weekly of trading, as shown on the Weekly chart as a reference point. I have identified this previous week of trading...
Here is a new trade setup. I will be taking this trade when it triggers. Price action has bounced off a major trend line is an indication price may be ready to start moving higher. Price then moved higher to form an engulfing candle indicating a new higher high had been made. Next price action formed an Harami candle indicating price action may be ready to...
Looking at the end of the second upward rally, I see a Doji. A Doji is the worse thing I want to see once an upward trend begins or after a long upward trend as it signals that traders are now confused or undecided about the upward direction; should the market continue higher or should the market turn back down? The answer comes in the next candle when price...
Looking at the second upward rally from the swing low (fractal) I see a 2 inside candles indicating the upward rally has stalled. The last thing a trader wants to see in an upward trend is a stalled rally. A stalled rally is indication traders are undecided as to whether or not to continue to push price higher. Following the 2 inside candles I see a Doji. ...
The first rally upward from the swing low (fractal) ends in a 4 candle bearish rejection pattern as shown in the red oval. If you take the overall High, Open, Low, and Close of these four candles it forms a bearish rejection candle as I have drawn above the price chart. A four candle bearish rejection pattern is a more important sign of price action rejecting...