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Is the Dollar Doomed?
Is it “Welcome Back Cotter” time again? Yet another week of absolutely horrid performance from the US economy punctuated by a very weak GDP number that showed both stagnation in output and an increase in price level. The news stirred memories of when John Travolta was 50 pounds lighter and 30 years younger and the country was deep in the middle of stagflation of the ‘70’s. The greenback lost 50 basis points against the euro, and would have lost more save for the fact that the pair is so overboughtthat it triggered a wave of profit taking on Friday afternoon after reaching all time highs at 1.3686.
The tiny corrective rally notwithstanding, present situation looks bleak for dollar longs. Last week’s data showed further deterioration in the housing sector, a slip in the help wanted index and of course the near contractionary results of GDP which printed at 1.3% vs. 2.5% the quarter prior. Many analysts claimed that this quarter may have been the nadir for the year, but that argument seems rather dubious to us given the fact that consumer spending will likely suffer further from the housing unwind while defense and government spending which contributed mightily to the overall decline of the GDP numbers will come under additional assault from Democrats who are now in charge of Congress.
As always,the answer as to whether US economy has just made a soft landing or is on the verge of crashing hard into a recession will rest on jobs. Jobs are the critical component to the US growth scenario and are the last bastion of dollar bulls. As long as employment maintains expansionary pace, consumers should be able to generate enough income to service their ever mounting levels of debt. Therefore, the NFP will once again be key and traders will keep a careful watch on all of the preliminary reports this week including Chicago PMI, and both ISMs for any potential clues to Friday’s numbers . – BS
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Can Euro go to 1.40?
Despite soaring to record highs, the high euro exchange rate seemed to have little negative impact on the export sensitive EZ economy.All of the key economic metrics from Consumer Confidence, to IFO to Retail PMI data beat forecasts as the region’s economy continued to demonstrate impressive strength.The case for decoupling in which the European economic growth maintains a steady pace while US performance stagnates markedly is no longer a matter of conjecture but one of fact.The euro continues to benefit from the EZ superior growth levels and more hawkish monetary policy that is expected to elevate rates to 4.00% by June. Indeed, even the record exchange value of the euro against both the dollar and the yen appears to be of little concern to monetary and fiscal officials in the union as they downplayed its importance in public comments last week.Perhaps, given the surprising power of the economic rebound, EZ officials are willing to tolerate euro appreciation up to the 1.40 level. However their patience will be directly proportional to employment growth in theregion.As long as the high euro does not crimp the improving labor market conditions, the sounds of protest from EZ politicians will be few and far between.If on the other hand EZ manufacturers begin to curb their labor force, due to completive pressures caused by the high euro, the political rhetoricwill become decidedly less friendly.
To that end this week’s German and EZ unemployment data may prove to be quite instructive to the market. Traders anticipatea further decline in the German rate from 9.2% to 9.1% and if it is not forthcoming, the news may trigger a deeper retrace in the pairas markets reconsider the impact of the escalating exchange rates. Ultimately however, it will be US jobs that will likely determine the outcome of trade this week. If US data disappoints the euro may gain regardless of any labor problems of its own. -BS
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Golden Week Holiday Leaves Yen to Dollar’s Whim This Week
After trading in an ultra-thin range for much of the week, USDJPY finally broke out to the upside on dollar’s dead cat bounce. Yen remained weak for the remainder of the week, especially as CPI data showed the economy continued to slip towards deflation, industrial production faltered, and retail trade pointed to even more dismal consumption trends. Markets turned their attention to the Bank of Japan’s policy meeting, and while the central bank left rates steady at 0.50 percent as expected, Yen saw a brief jump after BoJ Governor Toshihiko Fukui said that the Bank needed to raise rates even when gains in consumer prices are modest, as long as they are confident that growth in the Japanese economy is sustainable. Nevertheless, he acknowledged that the pace of rate normalization has been slow because of "weak" inflation and that the pace of rate hikes will be gradual.
Next week is Golden Week in Japan, leaving the economic calendar remarkably sparse with only labor cash earnings scheduled for release. The figure is anticipated to improve mildly to -0.7 percent, but with payrolls still stagnating or contracting, the outlook for consumption growth remains bleak. However, there is little reason for wages to remain so tepid, as Japanese companies have outperformed nearly every quarter. While it is apparent that firms have invested heavily in their own interests, it has also become clear that they need to divert some investment towards employees. This disconnect should keep yen from making any powerful gains this week, but technical factors may be working in favor of a USDJPY decline. In fact, the recent ascent faces resistance just above at the April 16th highs of 119.85, not to mention the psychologically important level of 120.00. Furthermore, thin Asian trade could leave the pair to move primarily on dollar sentiment, which may remain bleak in the face of potentially dismal NFPs next Friday, possibly leaving USDJPY bears in charge next week. – TB
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UK Data Unlikely to Break Cable from Critical Levels
The British Pound ended the week slightly lower, though the GBPUSD still hugged the all-important 2.000 level as economic data underpinned a Cable bid. While UK expansion in the first quarter slowed slightly to 2.8 percent from 3.0 percent, GDP hit the tape a bit stronger than expected at 0.7 percent for the quarter. The gain was led by the services sector, while industrial production detracted slightly – not entirely surprising as the manufacturing sector has long struggled in the UK. Meanwhile, Nationwide House Prices surged 0.9 percent, as steadily gaining real estate prices point to strong demand for housing. The recent Nationwide reading represents the highest levels in four months, with housing prices only adding to existing pressures on the Bank of England to tighten monetary policy.
Economic indicators on tap for the UK should maintain expectations for a hawkish policy stance by the Bank of England when they meet on May 10th. GfK Consumer Confidence is expected to rise to -7 from -8, signaling that sentiment amongst households is improving. Subsequently, PMI for both the manufacturing and services sector are forecasted to fall back. However, the moves are anticipated to be so minute, they will do little to sway central bank expectations. Barring a major surprise in the scheduled economic releases, GBPUSD will likely range trade throughout the week, but Friday could prove explosive as key US data will be released and could help bring Cable to tumble from these critical levels. – TB
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KOF Keeps Swissie Contained
Much to the dismay of Swissie longs the KOF index of leading economic indicators failed to print at 2.00 as forecast dampening any expectations of a possible 50bp rate hike by the SNB. The measure did register at 1.90 improving over the past month reading of 1.84 essentially assuring a 25bp raise at the next meeting in June. However, given the torrid pace of growth in the mountain economy which has seen strong gains in Retail Sales and near record low unemployment, traders had hoped that a very high print from KOF would prompt the SNB to tighten further and compress the interest rate differential with the EZ.With possibility of such an event now remote, the market plowed right back into the carry trade taking EURCHF to within a few pips of the 1.6500 level.
Although some analysts have speculated that 1.6500 in EURCHF may represent the “line in the sand” for SNB as the Swiss monetary officials begin to worry about the increasing dangers of imported inflation into the country, so far evidence of inflation has been scant.That’s why this Thursday’s CPI data may hold special importance as the price level is expected to skyrocket to 0.8% from 0.1% the month prior. Should that estimate prove accurate or worse print even hotter, talk of a 50bp hike will be quickly revived and the 1.6500 EURCHF level may be history as traders begin to unwind their longs. – BS
http://www.dailyfx.com/export/sites/dailyfx/story-images/2007/04/dailyfx_reports/Trade_or_Fade/2007-04-30_7.gif
Canadian Dollar Pushes Higher As True Event Risk Looms
Though monetary policy decisions always carry some level of inherent event risk, the Bank of Canada’s meetings seem to have become a mere formality for the currency market. With this in mind, it was no surprise then that the monetary authority didn’t cause any turbulence in the markets last Tuesday by announcing the overnight lending rate would go untouched from its 4.25 percent roost. On the other hand, this rate decision had a little more to it than the typical pass. A few days later, Governor David Dodge and his BoC colleagues released the April Monetary Policy Report. The brief statement repeated most of the same themes policy makers have given voice to in past months. Growth was given a clean bill of health as the bank touted domestic demand as the main engine and exports to the US as the slow break – nothing we haven’t seen before. Growth projections were trimmed slightly due to expectations of a prolonged US slowdown. Expansion is expected to average 2.2 percent this year and accelerate to 2.7 percent for the following two years. On that same note, there was a little more interest in inflation trends. With CPI hovering around 2.3 percent (above the target 2.0 percent), officials said inflation projections were “roughly balanced” but with a “slight tilt to the upside.” While this is not a dramatic change, it does break up the monotony and suggests ‘rate hike’ is still in the their vocabulary.
In the week ahead, the market is looking at data with much greater market-moving potential. February GDP released on Monday will star the markets off right. Economists predict expansion over the month ran a reserved 0.2 percent, which would line up nicely with the MPR’s projection for this year. At the same time, surprises are not uncommon for this indicator and a big one could set the loonie in motion. The possibility of a big move is particularly notable give the relative spot levels of USDCAD before the indicator hits the wires. Traders are at an impasse, deciding whether or not to extend the Canadian currency’s steady run to a fresh seven-month high against the almighty greenback. On the one hand, a read that comes in line or prints better than expected could easily recharge the loonie’s steady run. On the other, a disappointment could give additional weight to the ‘oversold’ sentiment that perpetual bulls have been crying out about for weeks. However the indicator prints and traders respond, the growth number could easily influence price action for most of the week – that is until Friday. On the final trading day of the week (while most of the currency market is tuned into US NFPs), the Canadian docket will release the April Ivey PMI. Expectations for the gauge of factory activity are running low, noticeably adding credence to a USDCAD bottom. - JK
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Risks Remain to the Downside for Further Aussie Moves
Critical Australian Consumer Price Index data sparked pronounced AUDUSD declines, with non-existent price pressures virtually ruling out higher domestic interest rates through the medium term. Markets were first warned of the impending CPI disappointment with a lackluster PPI report; given median forecasts of a 0.6 percent quarter-over-quarter gain, the production-linked price index stayed exactly unchanged through Q1, 2007. The combination of PPI at 0.0 percent and CPI at 0.1 eliminated hopes that the central bank would take rates to 6.50% through the coming week’s announcement. The Aussie instantaneously fell to two-week lows of 0.8234, but a later US dollar tumble allowed the currency to retrace all of its post-news losses. The currency is not out of the woods yet, however, with the key RBA Quarterly Monetary Policy Statement to guide expectations for any future interest rate changes.
Given that the RBA is exceedingly unlikely to raise rates through its Tuesday announcement, true event risk will be limited to Thursday’s Trade Balance and Quarterly MPS reports. Neither event is likely to lift the currency beyond current lows, as an exceedingly high AU$ exchange rate will limit Trade Balance recovery and the RBA is unlikely to prove hawkish in its stance on inflation. Of course, the market has arguably priced in disappointments in both figures—leaving scope for an AUDUSD rally on positive surprises. Whatever the outcome, the coming week promises to be a volatile one across AUD-denominated pairs, with short-term bearish momentum leaving risks to the downside for further AUDUSD performance. – DR
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Rate Hike and Equity Rallies Not Enough to Spark NZD Gains
It’s been a wild week in Kiwi trading, as a surprise interest rate hike was not enough to drive sustained NZDUSD rallies. In fact, the opposite was true; despite the RBNZ’s decision to raise rates ahead of market expectations, the NZDUSD saw its first weekly decline in nearly two months. An extra 25 basis points in yield and continued rallies in global equity markets proved insufficient to keep the Asia-Pacific currency bid.The drop was i caused n part by a strong US dollar rebound, but the fact remains that the high-flying NZDUSD failed to advance on bullish price developments. Central bank rhetoric was likely to blame for the bearish turn; the official Reserve Bank of New Zealand communiqué made no reference to the future of interest rates and instead noted the “unjustifiably high” NZ$ exchange rate. Given that currencies tend to move on changing and not static interest rate differentials, it stands to reason that stable rates at 7.50% would not necessarily lead to a continued NZDUSD advance. Furthermore, RBNZ Governor Allan Bollard’s reference to an “unjustifiably high” exchange rate led to fears of central bank intervention—leaving one more reason to sell the Kiwi through Friday’s close.
The coming week should be comparatively tame for the New Zealand Dollar, but markets have since been left to wonder whether the Kiwi can rebound and continue to rally despite recent developments. Noteworthy economic data will be limited to a Building Permits survey, with little scope for upward surprise leaving few hopes for a subsequent NZD rally. Instead, the New Zealand currency will be left to trade off of sympathetic moves to the Australian dollar on the upcoming RBA interest rate announcement. Stable interest rates for the Australia economy may look to add to the recent bearish sentiment for the popular carry trade pairs, leaving risks for the second consecutive week of Kiwi and Aussie declines. From a technical perspective, the NZDUSD’s inability to breach the psychologically significant 0.7500 mark likewise leave short-term bearish momentum intact through upcoming trade.- DR
Ilya
Perhaps, when you get a chance, you would post a couple entry scenarios with some details and a nice pic......
Perhaps use something recent such as GBPJPY decline and outline criteria for stops and targets and 'everything'.... lol
I do not feel it fair to ask that you post a live trade, however, I would think it ok to ask you to outline some criteria on a recent activity....
(I am not one to want to see live trades called, but I do like to learn from criteria used by others.)
Have a great weekend.....!
dave
This chart shows what I use as criteria for an entry point
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14442&stc=1&d=1210330836
Eurusd
EURSD Heading North,...
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14545&stc=1&d=1210621534 http://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14546&stc=1&d=1210621590
Euraud
Looks like we've got a Bullish Reversal in EURAUD.... If you look at the longer term picture in this pair... It's been nothing but tug-a-war price action for years.... Big swings up and down... Why not some more ! http://www.learncurrencytrading.com/fxforum/images/smilies/smile.gif
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14559&stc=1&d=1210652535
Nzdusd
Check out the candles on the monthly chart of NZDUSD... If that's not a Bearish Setup... I don't Know what is ...
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14609&stc=1&d=1210777769
GBPJPY Bullish Set up
This is a bullish candle formation which has formed on the Weekly chart of GBPJPY... I believe we should see some upside near term..
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14751&stc=1&d=1211158020
Hammer Formed
Looking at the GBP/USD There is a Hammer which hit former resistance around the .9400 area. Looking for potential to rebound to the .9700 area?
How are others assessing this?
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14633&stc=1&d=1210802673
do not see significant changes in the underlying forces as yet. Then again, only the market is always right, so the most logical analysis can be invalidated by momentum and sentiment. My bias remains bearish for now, though I am watching prices carefully for the market to yield new evidence.
Hope that helps
IlyaAttached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14825&stc=1&d=1211320760
Cable saw a wick low past 1.9416, but the double hammers on the daily chart right at channel support seem to suggest that we will in fact see an upside swing in the near term
Ilya
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14682&stc=1&d=1210889738
Ilya
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14547&stc=1&d=1210624208
Ilya
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14548&stc=1&d=1210624485
Ilya
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14562&stc=1&d=1210663180
Usdjpy
Here is A Daily chart of USDJPY, There is a medium term trend line which was broken not too long ago signalling upside potential in the pair.. However We Know the trend is down, Perhaps it is Better to hedge this pair for now, since we know that. Unless you would rather just take a chance on a counter trend position. The Choice Is Made By The Trader. We Can draw a trend line along the bottom of price and clone that line and then place it above the top of price action to define a channel for price to rise in to. We Are now Waiting For The Breach of The Lower Channel Line To confirm that the Corrective Price action is over and then Bears are clear to short http://www.learncurrencytrading.com/fxforum/images/smilies/wink.gif Until Then, Bulls Are In Control..
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14220&stc=1&d=1209790461
Gbpusd
Here we have a look at GBPUSD. As long as price can remain below the trend line drawn on the chart, it is likely that price will continue lower. Only a Breach Of The Trend Line indicates upside potential. Until Then Bears Are In Control.
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14238&stc=1&d=1209916763
Eurcad
Lets Have A Look At EURCAD.... This pair is in a bull run, we are currently just waiting for price to test the trend line. If The Trend Line Provides support then we buy http://www.learncurrencytrading.com/fxforum/images/smilies/wink.gif
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14243&stc=1&d=1209927440
EURCAD has peirced the up trend line warning us to have patience before taking on a long position.. We're about to close the Day in about 15 mins or so, and it looks like price is firmly rejecting the lows... It is a possability that the up trend line may need to be moved a little lower if price turns around and heads higher from here.. I have found this to be true many times in the past when a trend line is penetrated.. There can be some knee jerk price action.. Remain patient, if there is an opportunity, it will present itself http://www.learncurrencytrading.com/fxforum/images/smilies/wink.gif
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14378&stc=1&d=1210193555
Gbpjpy
Here is a look at GBPJPY... There are two trend lines in play here. The first one has been broken already giving way to corrective price action towards the second trend line. A Trend line can be drawn on the bottom side of current price and cloned to be placed above the price to give price a corrective channel to move up into.. Bulls are in control until We get a breach of the bottom corrective trend line (RED LINE)
There is a Bullish Engulfing Candle followed by a Harami after the down trend confirming a reversal in price.
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14247&stc=1&d=1209929952 http://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14248&stc=1&d=1209929959
Hi Ilya..
I've got a slightly different view for this pair. I'll be looking for a bounce off of support to buy.Attached Thumbnailshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14373&stc=1&thumb=1&d=1210189082
GBPCHF daily
It appears the downward trendline has held for touch number 3. We also see a candle close below the trendline piercing candle, indicating downward strength.
Aaron
Attached Thumbnailshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14389&stc=1&thumb=1&d=1210208502
Usdjpy
USDJPY is now under the short term Up Trend Line... And has created a reversal candle just under the weekly down trend line.. Price should rollover and continue lower from here...
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14486&stc=1&d=1210459983 http://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14487&stc=1&d=1210459991
Eur Aud
Looks like we're seeing a 3rd touch on the EUR AUD bullish trendline. Of course, i'll wait for the candle to close for confirmation thou....
Aaron
Attached Thumbnailshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14458&stc=1&thumb=1&d=1210360621
Eurcad
I have been patiently waiting to see if EURCAD would find support at the up trend line for a buy, So far it has not... http://www.learncurrencytrading.com/fxforum/images/smilies/frown.gif
Watch out for a decline if we get on the other side of the up trend line...
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14607&stc=1&d=1210775424
[ 本帖最后由 hefeiddd 于 2008-5-21 18:16 编辑 ]
eurusd turning up
the 4 hour chart of eurusd shows divergence as well as a penetration of the down trend line, which should give way to bullish price action shortly.
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14515&stc=1&d=1210598499 http://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14516&stc=1&d=1210598506
USDJPY
nuther look.......
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14415&stc=1&d=1210285723
GBPUSD 240 minute
Ilya...... would you enter once the lower line is passed. or would you insist on waiting for a top?
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14453&stc=1&d=1210348401
AUDUSD
This pair is trading in a tightening range. the wedge is soon to be broken... hard to say what the direction will be
Attached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14463&stc=1&d=1210378802
Yet another look at USDJPY.
IlyaAttached Imageshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14563&stc=1&d=1210664967
Another perspective on the EURUSD, this time from a 4-hr chart.
Ilya
Attached Thumbnailshttp://www.learncurrencytrading.com/fxforum/attachment.php?attachmentid=14637&stc=1&thumb=1&d=1210808223
Bearish Reversal Candlestick PatternsBearish Reversal Patternshttp://www.fxwords.com/images/words/bearish-reversal-candlestick-pattern.jpg
Strong Bearish Reversal Patterns Moderate Bearish Reversal PatternsWeak Bearish Reversal PatternsOne of the most significant goals of technical analysis is to identify changes in direction of price action. Because candlesticks give visual insight into what the market is market psychology, one of the most useful aspects of candlestick analysis is its ability to suggest changes in the sentiment of the market, and reversals in trend. We call these candle formations Reversal Patterns.
Important to note is that with candlesticks a reversal pattern does not necessarily suggest a complete reversal in trend, but merely a change or pause in direction. That could mean anything from a slowdown in trend, sideways trading after an established trend, or a full turnaround following a reversal candle pattern.
Highly Reliable Bearish Reversal Patterns Abandoned Babyhttp://www.fxwords.com/images/words/bearish_abandoned_baby.jpgDark Cloud Cover http://www.fxwords.com/images/words/bearish_dark_cloud_cover.jpgEvening Doji Star http://www.fxwords.com/images/words/bearish_evening_doji_star.jpgEvening Star http://www.fxwords.com/images/words/bearish_evening_star.jpgThree Inside Down http://www.fxwords.com/images/words/bearish_three_inside_down.jpgThree Outside Down http://www.fxwords.com/images/words/bearish_three_outside_down.jpg
Moderate Reliability Bearish Reversal PatternsAdvance Block http://www.fxwords.com/images/words/bearish_advance_block.jpgBreakaway Candlestick http://www.fxwords.com/images/words/bearish_breakaway.jpgDeliberation http://www.fxwords.com/images/words/bearish_deliberation.jpgDownside Tasuki http://www.fxwords.com/images/words/bearish_downside_tasuki_gap.jpgDragonfly Doji http://www.fxwords.com/images/words/bearish_dragonfly_doji.jpgEngulfing http://www.fxwords.com/images/words/bearish_engulfing.jpgMeeting Lines http://www.fxwords.com/images/words/bearish_meeting_lines.jpgTri Stars http://www.fxwords.com/images/words/bearish_tri-stars.jpgGravestone Doji http://www.fxwords.com/images/words/bearish_gravestone_doji.jpgHanging Man http://www.fxwords.com/images/words/bearish_hanging_man.jpgMeeting Lines Non-Fx http://www.fxwords.com/images/words/bearish_meeting_lines.jpg
Weak Bearish Reversal PatternsBelt Hold http://www.fxwords.com/images/words/bearish_belt_hold.jpgHarami http://www.fxwords.com/images/words/bearish_harami.jpgShooting Star http://www.fxwords.com/images/words/bearish_shooting_star.jpgHarami Cross http://www.fxwords.com/images/words/bearish_harami_cross1.jpgTweezers Top http://www.fxwords.com/images/words/bearish_tweezer_top.jpg
Intro to Candlestick Tradinghttp://www.fxwords.com/images/words/candlestick.jpg Bearish Reversal Patterns
http://www.fxwords.com/images/words/bearish-reversal-candlestick-pattern.jpgContinuation Patternshttp://www.fxwords.com/images/words/continuation-candlestick-pattern.jpg Bullish Reversal Patternshttp://www.fxwords.com/images/words/bullish-reversal-candlestick-pattern.jpg
[ 本帖最后由 hefeiddd 于 2008-5-21 18:28 编辑 ]
Bullish Reversal Patternshttp://www.fxwords.com/images/words/bullish-reversal-candlestick-pattern.jpg
Strong Bullish Reversal Patterns Moderate Bullish Reversal PatternsWeak Bullish Reversal PatternsOne of the most significant goals of technical analysis is to identify changes in direction of price action. Because candlesticks give visual insight into what the market is market psychology, one of the most useful aspects of candlestick analysis is its ability to suggest changes in the sentiment of the market, and reversals in trend. We call these candle formations Reversal Patterns.
Important to note is that with candlesticks a reversal pattern does not necessarily suggest a complete reversal in trend, but merely a change or pause in direction. That could mean anything from a slowdown in trend, sideways trading after an established trend, or a full turnaround following a reversal candle pattern.
Highly Reliable Bullish Reversal Patterns Aabandoned Babyhttp://www.fxwords.com/images/words/bullish_abandoned_baby.jpgMorning Doji Star http://www.fxwords.com/images/words/bullish_morning_doji_star.jpgThree Inside Up http://www.fxwords.com/images/words/bullish_three_inside_up.jpgThree Outside Up http://www.fxwords.com/images/words/bullish_three_outside_up.jpgThree White Soldiers http://www.fxwords.com/images/words/bullish_three_white_soldiers.jpg
Moderate Reliability Bullish Reversal PatternsModerate Reliability Breakawayhttp://www.fxwords.com/images/words/bullish_breakaway.jpgDoji Star http://www.fxwords.com/images/words/bullish_doji_star.jpgDragonfly Doji http://www.fxwords.com/images/words/bullish_dragonfly_doji.jpgEngulfing http://www.fxwords.com/images/words/bullish_engulfing.jpgHammerhttp://www.fxwords.com/images/words/bullish_hammer.jpgLadder Bottom http://www.fxwords.com/images/words/bullish_ladder_bottom.jpgMorning Starhttp://www.fxwords.com/images/words/bullish_morning_star.jpgPiercing Line http://www.fxwords.com/images/words/bullish_piercing_line.jpgThree Stars In The South http://www.fxwords.com/images/words/bullish_three_stars_in_the_south.jpgTri Star http://www.fxwords.com/images/words/bullish_tri_star.jpg
Weak Bullish Reversal PatternsBelt Hold http://www.fxwords.com/images/words/bullish_belt_hold.jpgGravestone Doji http://www.fxwords.com/images/words/bullish_gravestone_doji.jpgInverted Hammer http://www.fxwords.com/images/words/bullish_inverted_hammer.jpgTweezers Bottom http://www.fxwords.com/images/words/bullish_tweezers_bottom.jpg
Continuation Candlestick Patterns Continuation Patternshttp://www.fxwords.com/images/words/continuation-candlestick-pattern.jpg
Bearish Continuation Patterns Bullish Continuation PatternsContinuation patterns suggest the market will maintain an established trend. Often the direction of the candlesticks themselves are in the opposite direction of trend in continuance. Continuation patterns help traders differentiate between a price action that is in full reversal and those merely taking a pause. Most traders will tell you there is a time to trade and a time to rest. The formation of continuation candlestick patterns imply consolidation, a time to rest and watch.
Bearish Continuation Patterns Falling Three Methods http://www.fxwords.com/images/words/bearish_falling_three_methods.jpgDownside Tasuki http://www.fxwords.com/images/words/bearish_downside_tasuki_gap.jpgThree Line Strike http://www.fxwords.com/images/words/bearish_three_line_strike.jpgSide By Side White Lines http://www.fxwords.com/images/words/bearish_side_by_side_white_lines.jpgIn-Neck http://www.fxwords.com/images/words/bearish_continuation_in_neck.jpgOn Neck
http://www.fxwords.com/images/words/bearish_continuation_on_neck.jpgThrusting http://www.fxwords.com/images/words/bearish_thrusting.jpg
Bullish Continuation Patterns Rising Three Methods http://www.fxwords.com/images/words/bullish_rising_three_methods.jpgThree Line Strike http://www.fxwords.com/images/words/bullish_three_line_strike.jpg
Hanging Man
• Direction: Bearish
• Type: Reversal
• Reliability: Moderate to Weak
http://www.fxwords.com/images/words/bearish_hanging_man.jpg
• In a uptrend a red or blue day occurs with a body in the upper part of the sessions range, a long lower wick, and little to no upper wick
• Analysts do not care of the small candle is red or blue
The Hanging Man formation indicates trend exhaustion, and suggests a bearish reversal. After a bullish rally the day opens with a significant sell-off, creating a long bottom wick. However, buyers are able to push prices back to the upper range, creating a short body.
The meaning of the candle is a bit ambiguous. Even though sellers brought the market to low lows, in the end buyers brought the close price back up near the market open price. Overall this candlestick serves as an early indication that buyers are losing control and bearish traders are gaining strength.
Since the signal alone is fairly weak, traders look for a number of characteristics to reinforce the bearish signal.
In ideal conditions traders want the wick length to be several times longer than the body of the candle. The longer the candle, the stronger sellers were able to drive price down and the stronger the bearish signal this candle provides.
Although above we state that most analysts do not care if the small candle is red or blue, traders will actually take a red candle to suggest a slightly stronger bearish signal. Sellers being unable to bring the close price below the open price suggest stronger bearish control.
The bearish Dragonfly Doji serves as a stronger sell signal than the Hanging Man pattern. Since a Dragonfly candle (where open and close are identical, but we see a low similar in length to the Hanging Man) reflects more uncertainly and lack of direction, candlestick analysts will usually take it as a stronger bear signal.
• Hammer vs Hanging Man.
Alone, Hammer and Hanging Man candles look identical. Their difference lies in what type of trend the candle follows. If the market had been trending up for a while the formation is a Hanging Man. In fact the name, Hanging Man, suggest price is hanging over a precipice, ready for a fall. Hammers follow a bearish trending market and its name suggests price has already been weighted down.
Although traders will usually wait for confirmation the next day, look for selling opportunities to come.
Bearish Harami
• Direction: Bearish
• Type: Reversal
• Reliability: Weak
http://www.fxwords.com/images/words/bearish_harami.jpg
• First day is long blue candle continuing an established uptrend.
• Day-two is a small candle or start whose range is within the first days body, above its midpoint.
Bearish Haramis are characterized by a long blue day followed by a small candle, also refers to as a star. The trading range of the star stays within the body of the previous days candle. The significance of this formation is quite clear, as price continues its uptrend it is halted by a bearish candle.
Bearish Haramis are very weak in signal strength though, since even in a strong bull trend it is very reasonable to see a sell-off that pulls price back down from highs. Longs paring off their exposure may cause this. Thus candlestick analysts will watch for bearish days to come, but probably not bet on them.
In non-FX markets gaps seen above that allow the star to occur deep within the body of the first days candle are typical. Such gaps are just not possible in Foreign Exchange Markets. Since the Forex Market version of this candle is more nuanced, traders pay attention to several details.
This formation is very similar to the Bearhish Engulfing formation, except that the Harami move does not trade below the previous candles body. Because Harami sellers are not able to drive price much past the previous days midpoint, this patterns offers a weaker signal.
In range bound markets this formation will occur frequently with little significance. But if this pattern occurs after a protracted uptrend, analysts will attach greater importance to it.
Lastly if this does turn out to be a reversal pattern the high of the two candles will likely turn into a significant resistance level.
Bearish Harami Cross & Notes on Bearish Harami
• Direction: Bearish
• Type: Reversal
• Reliability: Weak
http://www.fxwords.com/images/words/bearish_harami_cross1.jpg
• First day is long blue candle continuing an established trend.
• Day-two is a small candle completely within the range of the first day's body.
This first possible version of this formation is characterized by a long blue day followed by a doji cross that falls within the body of the previous day's candle. Up to this point the formation matches the bearish Doji Star (see above). The doji illustrates a light day of trading where the open and the close are at the same price. A day of uncertainty after a large bullish move suggests bulls may have lost control of the market. Candlestick analysts will watch for bearish moves in the following days.
In non-FX markets gaps that allow the doji to occur deep within the body of the first day's candle are typical - But such gaps are just not possible in Foreign Exchange Markets. Because the close of the first day would match the open of the second day, in the Forex Market this formation should look more like a Hanging Man candle (see below).
http://www.fxwords.com/images/words/bearish_harami_cross2.jpg
Since the Forex Market version of this candle is more nuanced, traders pay attention to several details.
Bearish Harami Cross turns into simply Bearish Harami
Translating non-FX markets into Foreign Exchange requires getting rid of any gaps between candles. No matter what market we are looking at, FX, Equity and Futures markets typically close at 5:00pm. Thus the FX version of this formation should have a small red candle that trades down within the body of the previous bull move.
Bearish Doji Cross http://www.fxwords.com/images/words/bearish_harami_cross1.jpgBearish Harami Cross in FX http://www.fxwords.com/images/words/bearish_harami_cross2.jpgBearish Harami in FX http://www.fxwords.com/images/words/bearish_harami.jpgBearish Engulfing http://www.fxwords.com/images/words/bearish_engulfing.jpg
This formation is very similar to the Bearish Engulfing formation, except that the move does not trade below the blue candle's body. Because Harami sellers are not able to drive price down more than in the Bearish Engulfing formation, this patterns offers a weaker signal.
In range bound markets this patterns occurs far more frequently with little significance. But if this formation occurs after a protracted bull move analysts will put attach greater significance to it.