Forex Technical Chartist

Euro Takes a Tumble As Bernanke Hints At No Further QE

forextc — Thu, 23 Jun 2011 08:31:00 +0100

The US dollar gained from strong buying across the board on Wednesday evening following comments from Ben Bernanke which hinted that the US economy was not in need of a third round of Quantitative easing.

The earlier decision by Federal Reserve to keep interest rates on hold at historic lows did little to move the markets, as traders waited for clues from the Federal Chairman’s speech for hints of future policy.

Reiterating the expected end of QE 2 by the end of June, it was comments from Bernanke that hinted that that there would be no QE3 program which sparked the latest dollar rally.

EURUSD Technical’s

For the second day in a row the pair has failed to hold above 1.4400, posting as low as 1.4281 on continued dollar buying throughout the Asian market session.

While a mild recovery could be seen, we would expect any gains to be limited below 1.4400, with the Euro continuing to remain pressured.

Bias remains cautiously bearish with the pair looking to work its way lower over the coming sessions.

Key levels of support come in at 1.4274 (100 Day SMA), 1.4250 and 1.4190.

Resistance starts at 1.4339 (last Fridays high which coincides with the 50 Day SMA), 1.4400 and 1.4460.

EURUSD Looking To Gain On Back Of Risk

forextc — Tue, 21 Jun 2011 11:27:00 +0100

EURUSD has shown some resilience so far in spite of the week kicking off with some softer than forecast Producer Price figures from the German economy. Whether growth has already peaked in the largest Euro Zone industrial nation remains to be seen, but this did not stop the pair from rallying further from last weeks lows of 14073.

Strong headwinds remain for the Euro this week with continuing Greek austerity measures set to dominate the news flow. The market still awaits the result of a vote of confidence in the Greek Prime Minister, which if it fails, could lead to further crisis for the beleaguered nation as emergency measures are put in place.

However a vote of confidence would likely buoy the market and with an expected resolution to Greek debt restructuring, the single currency could see a short term rally.

EURUSD Technical’s

With price action remaining above 14190 the pair remains bullish despite the risk overtones of the market. 14339 (Fridays high) offers the first hurdle of resistance, beyond which targets would be set towards the 14460-14500 zone.

One the downside first key support comes in at 14274 (100 Day SMA) and 14190. A break below 14190 would invalidate the current bullish view.

Free Guide On How To Identify Trends With Trend Lines

forextc — Tue, 01 Feb 2011 16:05:00 +0100

Trendlines: How a Straight Line on a Chart Helps You Identify the Trend
A free 14-page Club EWI report shows you 5 ways trendlines can improve your trading decisions
January 31, 2011

By Elliott Wave International

Technical analysis of financial markets does not have to be complicated. Here are EWI, our main focus is on Elliott wave patterns in market charts, but we also employ other tools -- like trendlines.

A trendline is a line on a chart that connects two points. Simple? Yes. Effective? You be the judge -- once you read the free 14-page Club EWI report by EWI's Chief Commodity Analyst and Senior Tutorial Instructor Jeffrey Kennedy.

Enjoy this free excerpt -- and for details on how to read this report in full, free, look below.

Trading the Line -- 5 Ways You Can Use Trendlines to Improve Your Trading Decisions
(Free Club EWI report, excerpt)

Chapter 1
Defining Trendlines

Before I define a trendline, we need to identify what a line is. A line simply connects two points, a first point and a second point. Within the scope of technical analysis, these points are typically price highs or price lows. The significance of the trendline is directionally proportional to the importance of point one and point two. Keep that in mind when drawing trendlines.

A trendline represents the psychology of the market, specifically, the psychology between the bulls and the bears. If the trendline slopes upward, the bulls are in control. If the trendline slopes downward, the bears are in control. Moreover, the actual angle or slope of a trendline can determine whether or not the market is extremely optimistic, as it was in the upwards sloping line in Figure 1-1 or extremely pessimistic, as it was in the downwards sloping line in the same figure.

You can draw them horizontally, which identifies resistance and support. Or, you can draw them vertically, which identifies moments in time. You primarily apply vertical trendlines if you’re doing a cycle analysis.

Chapter 2
Drawing Trendlines

In this section, I’ll show you how I draw trendlines. I’ll start with the most common, simple way to draw them...

For more free trading lessons on trendlines, download Jeffrey Kennedy's free 14-page eBook, Trading the Line – 5 Ways You Can Use Trendlines to Improve Your Trading Decisions. It explains the power of simple trendlines, how to draw them, and how to determine when the trend has actually changed. Download your free eBook.

This article was syndicated by Elliott Wave International and was originally published under the headline Trendlines: How a Straight Line on a Chart Helps You Identify the Trend. EWI is the world's largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.

Robert Prechter Explains The Fed - Part I

forextc — Fri, 19 Nov 2010 23:21:00 +0100

The world's foremost Elliott wave expert goes "behind the scenes" on the Federal Reserve
November 19, 2010

By Elliott Wave International

The ongoing financial crisis has made the central bank's decisions -- interest rates, quantitative easing (QE2), monetary stimulus, etc. -- a permanent fixture on six-o'clock news.

Yet many of us don't truly understand the role of the Federal Reserve.

For answers, let's turn to someone who has spent a considerable amount of time studying the Fed and its functions: EWI president Robert Prechter. Today we begin a 3-part series that we believe will help you understand the Fed as well as he does. (Excerpted from Prechter's Conquer the Crash and the free Club EWI report, "Understanding the Federal Reserve System.") Here is Part I.

Money, Credit and the Federal Reserve Banking System
Conquer the Crash, Chapter 10
By Robert Prechter

An argument for deflation is not to be offered lightly because, given the nature of today’s money, certain aspects of money and credit creation cannot be forecast, only surmised. Before we can discuss these issues, we have to understand how money and credit come into being. This is a difficult chapter, but if you can assimilate what it says, you will have knowledge of the banking system that not one person in 10,000 has.

The Origin of Intangible Money

Originally, money was a tangible good freely chosen by society. For millennia, gold or silver provided this function, although sometimes other tangible goods (such as copper, brass and seashells) did. Originally, credit was the right to access that tangible money, whether by an ownership certificate or by borrowing.

Today, almost all money is intangible. It is not, nor does it even represent, a physical good. How it got that way is a long, complicated, disturbing story, which would take a full book to relate properly. It began about 300 years ago, when an English financier conceived the idea of a national central bank. Governments have often outlawed free-market determinations of what constitutes money and imposed their own versions upon society by law, but earlier schemes usually involved coinage. Under central banking, a government forces its citizens to accept its debt as the only form of legal tender. The Federal Reserve System assumed this monopoly role in the United States in 1913.

What Is a Dollar?

Originally, a dollar was defined as a certain amount of gold. Dollar bills and notes were promises to pay lawful money, which was gold. Anyone could present dollars to a bank and receive gold in exchange, and banks could get gold from the U.S. Treasury for dollar bills.

In 1933, President Roosevelt and Congress outlawed U.S. gold ownership and nullified and prohibited all domestic contracts denoted in gold, making Federal Reserve notes the legal tender of the land. In 1971, President Nixon halted gold payments from the U.S. Treasury to foreigners in exchange for dollars. Today, the Treasury will not give anyone anything tangible in exchange for a dollar. Even though Federal Reserve notes are defined as “obligations of the United States,” they are not obligations to do anything. Although a dollar is labeled a “note,” which means a debt contract, it is not a note for anything.

Congress claims that the dollar is “legally” 1/42.22 of an ounce of gold. Can you buy gold for $42.22 an ounce? No. This definition is bogus, and everyone knows it. If you bring a dollar to the U.S. Treasury, you will not collect any tangible good, much less 1/42.22 of an ounce of gold. You will be sent home.

Some authorities were quietly amazed that when the government progressively removed the tangible backing for the dollar, the currency continued to function. If you bring a dollar to the marketplace, you can still buy goods with it because the government says (by “fiat”) that it is money and because its long history of use has lulled people into accepting it as such. The volume of goods you can buy with it fluctuates according to the total volume of dollars -- in both cash and credit -- and their holders’ level of confidence that those values will remain intact.

Exactly what a dollar is and what backs it are difficult questions to answer because no official entity will provide a satisfying answer. It has no simultaneous actuality and definition. It may be defined as 1/42.22 of an ounce of gold, but it is not actually that. Whatever it actually is (if anything) may not be definable. To the extent that its physical backing, if any, may be officially definable in actuality, no one is talking. ...

Do you want to really understand the Fed? Then keep reading this free eBook, "Understanding the Fed", as soon as you become a free member of Club EWI.

This article was syndicated by Elliott Wave International and was originally published under the headline Robert Prechter Explains The Fed, Part I. EWI is the world's largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.

Forex Technical Analysis - FREE Guide From Elliot Wave International

forextc — Fri, 17 Sep 2010 17:36:00 +0100

Here's a guest post from Jeffrey Kennedy at Elliot Wave International. This is a great way to get your hands on a FREE techincal analysis guide!

By Elliott Wave International

There are two camps of market analysts out there: the fundamental camp and the technical one. Fundamental analysts look at things like the GDP, unemployment, interest rates, etc. to make logical assumptions about where the stock market is going.

Technical analysts use none of that. They look at the market's internals to gauge the trend: things like momentum, trend channels -- and yes, Elliott wave patterns.

And this is your free chance to learn how they do it.

We've put together a free 54-page Club EWI resource for you, "The Ultimate Technical Analysis Handbook." Below is a short excerpt from chapter 3. Enjoy! (For details on how to read this free report in full, look below.)

The Ultimate Technical Analysis Handbook
Chapter 3: How To Integrate Technical Indicators Into an Elliott Wave Forecast
By EWI's Senior Tutorial Instructor Jeffrey Kennedy

I love a good love-hate relationship, and that’s what I’ve got with technical indicators. Technical indicators are those fancy computerized studies that you frequently see at the bottom of price charts that are supposed to tell you what the market is going to do next (as if they really could). The most common studies include MACD, Stochastics, RSI and ADX, just to name a few.

I often hate technical studies because they divert my attention from what’s most important -- PRICE. ... Nevertheless, I have found a way to live with them, and I do use them. Here’s how: Rather than using technical indicators as a means to gauge momentum or pick tops and bottoms, I use them to identify potential trade setups.

Out of the hundreds of technical indicators I have worked with over the years, my favorite study is MACD (an acronym for Moving Average Convergence-Divergence). ... Even though the standard settings for MACD are 12/26/9, I like to use 12/25/9 (it’s just me being different). An example of MACD is shown in Figure 6 (Coffee).

The simplest trading rule for MACD is to buy when the Signal line (the thin line) crosses above the MACD line (the thick line), and sell when the Signal line crosses below the MACD line. Although many people use MACD this way, I choose not to... I like to focus on different information that I’ve observed and named: Hooks, Slingshots and Zero-Line Reversals. Once I explain these, you’ll understand why I’ve learned to love technical indicators. ...

Read the rest of the 50-page "Ultimate Technical Analysis Handbook" online now, free! All you need is to create a free Club EWI profile. Here's what else you'll learn:

Chapter 1: How the Wave Principle Can Improve Your Trading
Chapter 2: How To Confirm You Have the Right Wave Count
Chapter 3: How To Integrate Technical Indicators Into an Elliott Wave Forecast
Chapter 4: Origins and Applications of the Fibonacci Sequence
Chapter 5: How To Apply Fibonacci Math to Real-World Trading
Chapter 6: How To Draw and Use Trendlines
Chapter 7: Time Divergence: An Old Method Revisited
Chapter 8: Head and Shoulders: An Old-School Approach
Chapter 9: Pick Your Poison... And Your Protective Stops: Four Kinds of Protective Stops

Get more lessons like the one above in the free 50-page Ultimate Technical Analysis Handbook. Learn more and download your free copy here

Forex Technical Chartist

Euro Takes a Tumble As Bernanke Hints At No Further QE

EURUSD Looking To Gain On Back Of Risk

Free Guide On How To Identify Trends With Trend Lines

Trendlines: How a Straight Line on a Chart Helps You Identify the Trend A free 14-page Club EWI report shows you 5 ways trendlines can improve your trading decisions January 31, 2011

By Elliott Wave International

Robert Prechter Explains The Fed - Part I

The world's foremost Elliott wave expert goes "behind the scenes" on the Federal Reserve November 19, 2010

By Elliott Wave International

Forex Technical Analysis - FREE Guide From Elliot Wave International

Here's a guest post from Jeffrey Kennedy at Elliot Wave International. This is a great way to get your hands on a FREE techincal analysis guide!

By Elliott Wave International

Trendlines: How a Straight Line on a Chart Helps You Identify the Trend
A free 14-page Club EWI report shows you 5 ways trendlines can improve your trading decisions
January 31, 2011

The world's foremost Elliott wave expert goes "behind the scenes" on the Federal Reserve
November 19, 2010