Archive for May, 2008
Contradicting Signals for $?
By Marek W. Stupka | May 13, 2008
Take a good look at the EURUSD charts below. The 4h chart shows signs of bearishness, while the long-term, 1w chart signals possible reversal…
[ Click on the chart to see bigger picture ] However, if you are familiar with the Convergence / Divergence scenarios (tought in my training course), you can definitely recognize one clear divergence pattern in the chart above…
What does this indicate? It indicates one very important thing about this pair - the current EURUSD downtrend is about to continue for a rather short time, but chances are that later on is to be replaced by another set of upmoves.
And truly, if we examine the profoundly long-term, 1w chart for the same currency pair, we can see that price is hitting the Resistance line of the former channel (green), while the pair has broken the channel top in February 2008 and is now testing the same Resistance line, only from the above, t.m. the Resistance has now become Support. This, as we know, happens quite often, and is proven to work as a simple S/R technique. However, to actually recognize this setup as a long-term signal we should apply additional tools of Technical Analysis. If you are my student, please refer to the lesson on S/R…
Topics: FOREX Trading Analysis | No Comments »
Fundamentals vs. Technicals
By Marek W. Stupka | May 12, 2008
Since I am in constant contact with traders around the world, I am being asked the same questions - e.g. what do I recommend to base one’s trading on…
Is it the economic reports like the NFP, or the FOMC rate decision, that we should take as basis for taking our trades? Or is it the chart analysis, and its specific strategies and signals, that should determine when and in which direction we open our position…?
Traders are usually divided into two major groups:
1. Those who base their trading on Technical Analysis (as the logic would have it, they’re called the “Technical Traders”;
2. Those who base their trading on Fundamental Analysis (also called the “Fundamental Traders”, as you correctly assumed).
Let me give you reasons why I belong to the first group of traders. Let me also show you why you should too (unless you have a really huge load of money to spend every month).
Reason Nr.1: Transparency
Yes, it is true, Fundamentals influence the markets. But are the reports transparent enough for us to determine which direction the market is going to move after the release? There are cases (happening more and more frequently now) when a news report is supposed to be “positive” for a specific currency, while, right after the release, the currency decreases RAPIDLY against the other ones! There are cases when the news is just not influential enough. There are other cases when an important piece of news is out - and nothing happens! The reasoning? Market has already “priced-in” that piece of news long ago…
So how can you know? How can you “trade the news” (with consistent profits, that is)? The ugly, naked truth is that you can’t, really, until you subscribe to a VERY expensive newsfeed from either Bloomberg or Reuters, AND until you hire your own analytic department to process the news for you - real time.
See, we technical traders are able to predict certain market moves even with relatively inexpensive tools, and still make consistent profits, week-in and week-out. One condition applies here, though: you have to have a sound, high-quality analytic know-how, and enjoy at least few months of real trading experience. Our best scenario is then that we “catch the train” and make money. In app. 2 cases out of 10 we don’t – but we still can roll back our charts, and technically improve upon our failures…
The rest of this article, and much, much more, you will be able to find as part of your 1-on-1 FX Training coverage. Hundreds of traders from New York to Afghanistan have already taken the training course and many of them (those who took trading seriously and have worked and learned hard) are now successful, active traders. Please visit the Gepard Investments, Inc. website to see how you can become one too.
Topics: Miscellanous | No Comments »
ECB to Leave Rates Intact?
By Marek W. Stupka | May 6, 2008
This week’s biggest event risk is the ECB interest rate decision. Will Mr. Trichet acknowledge the latest weak results from the Eurozone?
The latest deterioration in the Eurozone economic data has been the major concern of every European patriot. German retail sales dropped for the second month in a row. The unemployment rate increased. Retail PMI contracted accross the union…
It seems that the US recession has finally hit the old continent. There is no doubt - no major world’s economy exists as a stand-alone entity, but to a certain extent all of the richest regions on this planet are tightly connected. This is due to the nature of the global markets themselves, their intercorporate and interinstitutional connections. And so, while the USA is amidst the obvious economic recession with home foreclosures and job market tightening, the European Union has just been affected by the outer waves of the storm.
Now, in times like these, keeping inflation under control becomes the top priority for both central banks, as the ECB member Liikanen reminded the investor community last week. While the uncertainty surrounding this week’s ECB rate decision might lead to some market volatility at the time of the release, most analysts agree that Mr. Trichet will say good bye to his usual hawkish tone and leave the interest rates unchanged.
And again, please be aware that we at Gepard Investments DO NOT base our trading on fundamental analysis. Fundamentals only serve as GENERATORS OF MARKET MOVES. Our trading is triggered by properly backtested, trading systems, built on sophisticated and still easy-to-apply technical strategies. We keep track with the latest economy reports and analysis, but we base our trading on tested technical patterns. A complex trading education is being offered exclusively to my 1-on-1 students (their number grows extensively) for a rather symbolic training fee. The training also includes access to the 3 tested systems and their updates, as well as to many other online features e.g. personalized Trade Journal able to record numeric details of your every trade, chart screenshots, remarks, etc.. Please visit the Gepard Investments, Inc. website for details.
Topics: Uncategorized | No Comments »
EURUSD & GBPJPY News!
By Marek W. Stupka | May 6, 2008
Technically, the recent $ rally is just an inevitable correction from the EURUSD overbought territory. Why has the market stopped falling?
[Click on the chart to see bigger picture ] Take a very good look at the 4h chart above. Can you see the long, blue trend line intersecting the chart’s candles in the beginning of February 2008? This line connects peaks of the 2007 price actions BUT also bottoms of the 2008 development as well! It is a very important Support/Resistance treshhold, and the market is just bouncing off it as we speak…
Of course, the setup above is profoundly simplified. As usual, I do not recommend taking ANY trades based on the charts published on this website. As my 1-on-1 students already know we at GI trade on sophisticated (and still easy-to-use) trading systems built on proven, backtested strategies to actually deploy our every trade. I will do my best to publish another PDF Chart Planner update soon, summarizing trades I plan on taking, and the technical tools I use to identify them in my charts. And again, the updated planner will be delivered to the mailboxes of my students hours before the trade can be taken, so that there will be plenty of time to study it and open the position.
As far as the carry trade markets are concerned, we have seen lately some risk appetite returning to USDJPY, and GBPJPY as well. Inspect the chart below. Can you see the obvious MACDH and Stoch convergence? I used it, along with a clear signal rendered by THE CONFIRMATOR (one of my three trading systems) to actually capitalize on this pair last week! And the story doesn’t end here. Get ready for another trading opportunity from this pair any time soon!! Just always make sure you obey all of the system rules…
Topics: FOREX Trading Analysis | No Comments »