EURGBP

[Mercury]

There has been some discussion about GBPUSD and EURUSD of late but I return to previous discussions on the third of this triangle EURGBP because I think it is nearing a significant turning point (quite possibly today with ECB meeting and FOMC minutes releases).

 

This cross has been on a fairly strong rally of late, which I believe is an A-B-C relief rally before a further drop and it could drop a long way.  Conventional wisdom has it that the GBP will be weak because of Brexit, and vs USD that is likely but the EUR has it's own issues and Draghi's policy is the main one.  I see both GBP and EUR dropping hard against the USD as financial crisis begins to bite and my analysis suggests the Euro will be hardest hit.  Let's face it all we need is a reemergence of the Greek thing for this to be true. not exactly a stretch is is?  Indeed there have been some rumblings already in the press - a leaked memo from the IMF for instance.

 

Anyway my Weekly chart analysis shows at least one further big leg down after a hit on the upper (purple) tram and if that move was only a 1-2 (difficult to be confident just now but even something else the overall Bearish view is still valid) then the drop could be huge.  The Fib 38% is near the tramline too plus Neg Mom Div is building.

 

On the Daily there is a junction between the red down-sloping tram and the green up-sloping tram PLUS the Fib 62% with the weekly Fib 38% just above.  I also have a valid A-B-C count about to complete AND an alternative 1-5 count also about to complete (i.e. either way you look at this a turn is on!).  I also have Neg Mom Div and overbought Stochastic and RSI.

 

On the hourly the final W5 from the daily is also into a final W5, Neg momentum divergence is building but RSI and Stochastic are not yet signaling the turn.  This is as I would expect if we are to get a final push up to the turning point I have forecast (the red circle).  Additionally I have a valid hourly chart tramline pair that intersects with the Daily Junction (as near as I can tell because the daily chart lines do not translate accurately to the hourly chart in PRT for some unknown reason...!!!).

 

In he final analysis this is why I mentioned EURGBP turning at 8100 the other day and that is still my forecast (max 8130 - the Weekly chart Fib 38%).

 

Here are the charts:



[Mercury]

LOL!  Yes I know who he is but have never bought any of his books.  He has a few websites though where you can get some free stuff and he also does a free newsletter from a weekly money magazine that I take (the only one I take because it give a more balanced view of the world in my opinion).  I'm not sure I'd call myself a devotee, and I disagree with him from time to time but he is certainly worth reading.

 

How do you know of him?

[Guest oilfxpro]

eurgbp    

eurusd  is  finding major resistance at 114  ,  i nearly bought 2 week put yesterdat at 65    at 114  strike price , this is would be profits

 

cable is at major major supports , eur gbp top of channel   .

 

no trade at present.both are ranging   in large ranging boxes  , why am i missing  this elliot waves and elliot waves  anylysis from my charts?

 

I had very good experience  of failure of elliot wave  in real trading , it never worked in real time  and this trader of elliot wave lost  30 pips a week for 9 months  on live accounts  , all these theories on elliot wave   require proven   live account results  , to be believed by anyone.After event the elliot waves charts are so clear , but nothing is clear  in foresight  , there is no clear signal about what positions to take    in real time.In my opinion , it is subjective   as are all the waves.

 

http://www.fxfisherman.com/forums/forex-metatrader/classified-ads/15302-wanted-trading-educator.html#post101982

 

http://www.fxfisherman.com/forums/forex-metatrader/classified-ads/15386-wanted-elliot-wave-trader.html

 

I use support and resistance and intermarket correlations  , with trend lines  channels

 

 



[Guest oilfxpro]

here is chart for support resistance and ranging boxes for cable and eur usd  .

 

 

 

 

 

 

 

 

[Mercury]

OK have just gone short at 8095, may be a little premature and it could pop up to the Weekly Fib 38% resistance line where it intersects with the Daily green tram from my previous Daily chart but I have stops above that so fine for now.  

 

Chart:



[Mercury]

FYI,my second entry point is 8130.

[Guest Condor]

ditto short 8096 , I got stopped out shorting earlier x 2 so, I've got another set now and hoping 3rd time this works out. It seems incredible to me how this  has gone up today (but thats due to my inexperience at ccy trading i guess) .  At times it really surged up I'm just hoping it goes back down with the same strength! C

[Mercury]

 Hi Condor,

 

If it does turn out to be the major EW5 turn I think it is then we should see a relatively small 1-2 before a strong wave 3.  Look for a 1-5 down followed by an A-B-C return.  Note that it could come up almost to a double top so don't move the stop until after that.  It's the wave 3 you really want.  For this one you really have too watch the other 2 crosses with the USD to make sense of this one.  I believe both will go down vs the USD soon, maybe even after the FOMC minutes release.  For this cross it just depends which moves faster...

[Guest Condor]

Thanks Mercury...just spotted your post.

I did follow the drop down setting my Stop Loss down behind ...and got stopped out at 8075  (which was about 12pts behind) .. I've watched since and at time of writing it has gone sideways for about 2hrs 20 mins (as i'm sure you know if you're still running your position).  Trying to figure when /where the next drop is coming.....

 

 

[Mercury]

 Hi Condor,

 

There could be another leg up to and if so then resistance would come in around 8130 (as per my previous post).  Not also a set of tram lines, which if broken (lower) to touched (upper) would provide a decent entry for a Short.  I am expecting a strong showing from the Euro today to reach the turning point I have forecast so it is quite likely we get a corresponding jump on this cross.

[Guest Condor]

Well that strong showing from Euro has materialised now north (8109) area , maybe it will make that higher 8130 area - i'm looking for the turning point.  Shows the value of stops! Important point for me.

[Guest Condor]

I shorted again on EURGBP at 8093 the turn seems to have occured at around 8114.....now at 8079....hoping this will now drift lower after the initial EUR surge.

[Mercury]

Ok decent entry but keep stops above 8130 to be sure or else move quickly to B/E if you don't mind searching for the perfect entry.  Personally I prefer not to do that but to recognise that most of the time I will go into the red for some period of time.  So long as the max loss on your stop is within you normal acceptable that should be fine.

[Guest Condor]

I've successfully traded the drop twice today - it seems easier for me to see the signals on the indicators for the drop so thats three times over the last 2 days the 8096-ish range down to 8080-ish has worked for me while it's been trading in this range.  Since I'm bearish on EURGBP each time I'm hoping it's a long drop,  although that may yet materialise.

[Mercury]

EURGBP has just broken my supporting tramline and is making a lower low after a completed 1-5 up with strong Neg Mom Div at the top (if it is a top...).  If this is the turn we can look forward to a small 1-5 down before a 1-3 retrace and then a proper drop.

 



[Mercury]

Second break and Kiss back on my lower tramline, have taken a Short near the Kiss.  Under conventional charting methodology I can now draw a parallel and equidistant tramline.  Here I have 2 possibilities but getting down to around 8000 is looking likely at this point.  GBPUSD has just rallied, EUR less vigorously.

 

Interested to hear what others see?

 

Chart:



[Mercury]

Strong break down on this cross, with a small Triangle break, indicating the turn has happened.  Ideally I'd like to see the much anticipated turns on EURUSD and GBPUSD as well, not quite there yet...  There is still a chance that a fresh higher high could be posted on this cross but the chances are diminishing with this strong break south.  A retrace and kiss on the lower Triangle line is, however, highly likely (Hourly Stochastic and RSI in oversold levels) and would offer a great shorting opportunity it if it does, especially if it coincided with the turn on the other two!

 

What do you think?

 



[Mercury]

EURGBP update:

 

The break of the Triangle was followed up by a break of the congestion zone support (also a possible H&S neckline).

 

I am now thinking that if GBPUSD does fall away from the Fib 62% (or even the 76%) we will get a pull back a potential kiss on the support line (green) - now resistance - in a W1-2 and then a fall away in W3.

 

Thoughts anyone?

 



[Guest Condor]

The thought I'm trying to work out is.....Is this a Five-up-Three-down  or Five-up-Five-down then an A-B-C to come. The wC being the big one to get on.  The w3 down was strong - tick. Maybe the w5 is about now..... 7960? which if it does turn could go up to A.  Possible scenario?  C 

[Mercury]

Whoa!  have you been studying EW theory?

 

I looks like 1-5 down, though I'm not yet sure it has finished. There is Pos Mom Div but this is not trustworthy on such a small move, especially as set against the much stronger Neg Mom Div to the recent highs.  it is possible we could get a final leg up but it should not penetrate much beyond the Weekly Fib 38%.

 

If you are not already Short the best plan is to wait for a decent pull back and try to assess whether it is an A-B-C or a final leg up.

[Mercury]

PS: GBPUSD has now dropped away strongly from the congestion zone on my chart and EURUSD is dropping too but more slowly at present so that retrace I was expecting is happening.  In a primary market such as those 2 I would be looking for a kiss on the resistance line but with this cross you never really know...

[Guest Condor]

:smileywink: you bet i have (been studying) my mrs can't get a word out of me I want to get this technique going for me and that way I'll be able to contribute better here & trade better. C

[Mercury]

OK great.  Take it slowly though, it takes a lot of getting used to and there are many false trails.  Best thing is to find some people to share analysis with and look for several scenarios then hone them to one you are confident to put your hard earned cash at risk on.