A-B-C-D Trade - page 168
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We have a 30-min EUR/USD with session colors created by the indicator Time_Modified2, which as been posted. We have to adjust it according to any changes with Daylight Savings Time. We also have the U.S. session shaded into the European session (overlap), from 13:30.
We can see the ABC plot using June 16th European session Low to U.S. High as A-B. During Asian, the High was revisted and a bounce down ensued to form Swing C.
Therefore, Point B is the Asian High, which is the ideal set-up for a breakout trade. Experienced traders can enter at the 61.8 pullback as previously described.
If the trader is unsure of the ABC plot, we have advised to plot the B-C leg of last session high/low.In this case, it is the same. This plot is shown in red fibs.
We can see the bounce off the red 138.2 during the 09:30 candle. This is the same bounce off the FE 78.6 as mentioned. Price dipped back below the break point.
When we understand why it is moving back down, we tend to panic less. If fact, the word panic would not be accurate. We would be somewhat concerned, but anticipate that it is just a pullback bounce off a fib.
The red plot form B-C also gives fib levels to S/L placement, which was covered early in this thread. The red ratios are inverted (upside down) in this example, but is still good.
We labeled the 2 exit targets at the E 100 and FE 127. Aside from being the same as the A-B extensions, it also is the same as the B-C plot's 161.8% and 200%.
The calculation for the top involves a tighter fib plot, 09:30 low = 1.42015 and 11:30 high = 1.42985. The 138.2 = 1.43356.
Bounce off the top came back down to the FE 100 level.
Next up is USOIL.
On our June 15h post #1657, we updated price action that conformed to our earlier Andrew's Pitchfork (APF) plot of June 14th.
Now we can look at Friday June 17th. We added the HAMa T3 candles, which uses the same calculation as the histogram version on bottom of chart (HAMa Step Histo).
The June 15th 17:00 candle touched the lower fork and bounced up. It went into consolidation until early Asian June 17th. The resistance was the AL1Lower_ML1 (gray dotted diagonal). The HAMa candles also contained the top of that range.
The 07:00 candle broke the lower fork line and hit the yellow 161.8 extension. With the Greece rumors and apparent deal, USOIL moved back up to the AL1Lower_ML2, and also was contained by the HAMa candles.
A subsequent drop back down closed at the 161.8 as traders exiting positing ahead of the weekend. Some also may speculate that the Greece deal is not ideal.
Whatever the reason, we have our S&R, and can pick ares to trade. Remember the analogy about the "herd mentality". We wait in the tall grass.
We'll plot fib channel below the lower fork in due course, in event market moves to the downside.
We recall our comments from a couple of months ago. Jitters with oil above $100/barrel will see shift of some of that money into gold. The impending end of America's QE2 and slowing in China will reduce demand for oil. Our recently posted MultiInstrument chart shows the gap widening.
Have a nice weekend, and we'll likely post more.
Let's post this now for our friends viewing in Europe, Asia, etc., so they can digest during what's left of their weekend.
We've never posted a GannBox_144 indicator plot for USOIL. We see this Contract For Difference (CFD) USOIL sitting on an important support level.
The attached USOIL daily chart plots Price (height of box) at 3600 and Time (width) at 360. These inputs can be seen on the lower left hand corner of box on chart.
We can see the important 1/2 angle line (red) breached. Friday's candle sits on the blue 1/4 horizontal line (price 92.84)like a bird on a wire. When we look to the left, we see this level as resistance in January.
Should this support level be broken, next significant level is of course 83.84, the start price of box, and Feb 15th low.
The next chart is USOIL daily with indicator Golden Section v3.2. This indicator came out about 4 years ago from Russia, which has been the origin of some amazing work, including nen's ZUP. We understand this coder is a co-developer with nen on certain MT4 work.
We reiterate that although S&R can be incorporated into systems, it is not a system by nature. It is a tool.
The spiral makes new rings by Fibonacci ratios from the center. There are 2 sets of fans, one on each side of the center. The yellow box in the middle is plotted based on top being 200% from bottom, with center at 100%.
The plots will change when changing time-frame. We can see price break below the 261.8 spiral ring, which as support from May 5th to June 12th. This week has been the break period. That is until it met current horizontal support outlined above in GannBox comments.
We inserted label of 423.6, the next spiral fib ratio. That calculation is 261.8 (last spiral) X 1.618 (golden ratio) = 423.6. The way to check this is to plot a fib retracement from the center of box/spiral and pull down to bottom of box. You then need to input 423.6 ratio into edit function of fib tool.
Should decline continue, price may not reach the horizontal 423.6, but instead, hit the spiral 423.6.
While we're at it, there is a golden section plot for EUR/USD too. Indicator for GannBox_144 can be found in Indicator section under Gann Is The Man thread. The Golden Section v3.2 is attached.
The Golden Section version 3.2 allows user to turn on the Andrew's Pitchfork. When this is done, the plot changes, and the Median Line (ML) of the APF is aligned with the center of the spiral.
We've done this for the EUR/USD 4-hour chart. We also applied the fib channel tool to get more channel lines below the lower fork line.
The APF plot generated by the indicator:
1) Handle = June 1st 20:00 low 1.43060
2) Upper corner = June 7th 16:00 high 1.46952
3) Lower corner = June 12th 21:15 low 1.43194*
We also plotted horizontal fibs using Point 2 as high and Point 3 as low. This resulted in 161.8 of both the channel fibs and the horizontal extension plot to meet with the June 16th 08:00 and 12:00 candles.
The bounce up, as declared last Friday, hit the wide 38.2 of the May high/low plot, during the 15:00 hour. This area is also the tight horizontal 61.8, fibo fan 78.8, lower corner (3) of APF, 61.8 channel fib, and a couple of other fibs. Thus the cluster made that bounce trade down a very high probability.
The initial reports regarding the Sunday meeting of EUR Finance Ministers, pertaining to the Greece funds, are that they is not agreement yet.
German Chancellor Merkle had backed off requirement that private bond holders would be exposed to a haircut (loss) on Greek debt. This was seen as a major development to path the way for further funds.
The Greek government is facing stiff public opposition to proposed additional austerity measures. They may also face a vote of no confidence Tuesday.
Therefore, today we look for strength in CHF, for example EUR/CHF bearish bias. USD strength as well.
Immediate support:
EUR/CHF 1.21138, which is 50% fib
USOIL 92.88
EUR/USD 1.42556
Trend line (TL) plots holding up thus far on:
USOIL TL: June 17th 07:00 high 94.60 and June 17th 12:00 high 94.18
Horizontal fib plot: Low = 91.83 and High = 93.36
EUR/CHF TL: June 17th 18:00 high 1.21437 and June 20th 00:30 low 1.21349
Horizontal fib plot: High = 1.21437 and Low = 1.20995
- pullback to 88.6, but 15 and 30-min candles closed below TL.
Retracement plot in direction of short: High = 1.21385 Low = 1.20995
All 3 aforementioned instruments testing 2nd tier support below immediate support previously posted.
EUR/USD 1.42198
EUR/CHF 1.20967/1.20995
USOIL 1.9183
06:00 high-impact data ahead
Labeled prices on 15-min EUR/CHF:
1) June 17th 12:30 low 1.20839
2) June 17th 18:15 high 1.21437
3) June 19th 23:45 low 1.20995
Add MurreyMath_1.0 indicator (MML)
Point 1 is at 4/8th. Point 2 is at 5/8th.
Plot trend line (TL) at Point 2 and June 20th 00:30 high 1.21349,as we mentioned.
Horizontal fib plots:
Point 1 to Point 2 (yellow)
Point 2 to Point 3 (blue)
Comments:
We posted that the pullback of Point 2/Point 3 plot went to the 88.6, but closed the candle at the TL (orange). Experienced traders enter when price drops below TL. Stop-loss above 88.6 or Point 2.
Profit targets:
Immediate support pivot low from 01:00 1.21138
Point 3 1.20995
Point 1 1.20839
The 138.2 extension of Point 2/3 (blue) is the same as Point 1 price level.
- this is also 4/8th MML
Price hit the 161.8 of 1.20722 and bounced up violently to Point 3 price level.
Price now trying to revisit 161.8