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EURUSD Locked In a Range
By Marek W. Stupka | March 2, 2010
Today, I would like to bring your attention to one important fact that was scientifically proven using the math behind the charts: “Financial markets spend most of the time locked in clearly defined ranges”. Let’s have a look at the 1W chart for EURUSD…
Now in the 1D chart above [ click on the chart to get a bigger picture ], we can clearly identify the actual mid-term price range (green parallel S-R trend lines in the right part of the chart/ at GI we like to call them channels). Moreover, there are other profoundly long-term channels, or trannels, the pair has been bouncing on and off, some of them drawn in the chart (red), some not …
As usual, I will not go deeper into the thorough technical analysis of the EURUSD currency pair. One thing is clear, though, and that is the pair is now - like I already wrote in my last technical blog article - perfectly set for posting excellent trading opportunities when applying the CANAAL (short-term) and the CONFIRMATOR (mid-term) Trading Systems, both proprietary to Gepard Investments, Inc.
Let me just give you a beautiful example of how to trade a range-locked instrument, as EURUSD is at the moment - in accordance with the CONFIRMATOR TS in its Sher-lock market phase:
The chart above is actually EURUSD, t.m. the same currency pair as above, only rendered over a shorter time period (1 hour). All of the red circles you can see in the chart represent due CONFIRMATOR trading opportunities, or signals, generated by the CONFIRMATOR Trading System after considering all of its rules.
Watch out, though, no range is kept forever! There will come a time for this pair to cross the range barrier, either the top or the bottom one, and then to continue moving in line with a freshly defined new trend. For the immediate trend change, or swing as some like to call it, there are other technical tools to be applied choosing out of the comprehensive portfolio of GI technical toolset. If you are my 1-on-1 FX Student, I certainly recommend to review all materials comprised in Modules 4 and 10 of your training course in order to properly identify trading opportunities when price moves within a range, and when it crosses the range from inside out …
Topics: FOREX Trading Analysis |