Ralph Shell article

See the link COT reports by Ralph Shell on the right and go to articles for "Prime Minister Abe Keeps His Promise". With the way the Yen has dropped who can argue?

Recap 10 Jan EUR GU EJ 11 Jan

Recap 10 Jan

The down bias for EUR and GU did not happen as the mentioned support levels 1.30 and 1.60 held. EJ went up as per bias.

11 Jan

EUR - Engulfing positive close in reaction to EUR rate discussions. Bias up but obviously can react lower to the highs 1.3250-1.3300.

GU - Bias up but can react lower to the 1.6175 resistance level.

EJ - Bias up.

Recap 9 Jan, EUR GU JPY 10 Jan

Recap 9 Jan

The EUR, GU down bias did play out after a failed attempt higher around LO.

10 Jan

UK MPC statement, EUR interest rates and press conference. For me after NFP easily days when I am happy to leave trading and come back after the news is out to see if there are nice price waves (higher lows, lower highs) to trade.

EUR - Negative D close below the ma, RSI below 50 level. 1hr lower high lower low in tact (barely). We have the proven support level 1.3000, W M2 at 1.3031 and the early Jan lows to contend with. We can obviously bounce higher from these areas but overall bias down.

GU - Largely a similar picture, we are at the early Dec lows 1.6000.Bias down.

EJ - Positive D close, 1hr flow higher high higher low. Bias up with potential to react to the highs around 115.50.

Recap 8 Jan, EUR GU EJ 9 Jan

Recap 8 Jan

Bias was up, with the potential for upper resistance levels to hold, they did on all pairs. The 1hr price action was poor in London morning session and we were able to sell a GU engulfing negative close, intra day lower high in US session.

9 Jan

EUR - D closed negative, lower high currently on the high from 5 Oct 1.3070, below RSI 50 level and below our ma. 4hr flow still on higher high higher low but a negative close on the current candle would flip this over. Already below our ma's and RSI 50 level. 1hr has already flipped over. Bias down.

GU - Essentially the same picture. Bias down, could be some bounces in the support area 1.6000-6030.

EJ - The JPY authorities have done a brilliant job of managing their currency weaker to aid their exports. Whilst a negative close on D from the upper resistance level 115.50, after 5 days failing to go higher, should be sell bias today. 1hr lower high lower low flow has already been broken this morning after an Asian session 90 pip move up. Will watch carefully as I prefer to take fewer risks counter trend with JPY pairs.

Recap 7 Jan EUR GU EJ 8 Jan

Recap 7 Jan

As mentioned Monday morning did not really do much. The key levels for EUR 1.3000 and GU 1.6000 held. Both pairs had 4 hr engulfing positive closes to signal move up. We traded EJ which did not move up as much.

8 Jan

EUR - Support held, D positive close, 4hr flow now higher low, bias up. W M3 1.3180 and lows from 21-31 Dec looks a decent target area.

GU - Same picture as EUR. We are at a potential resistance area lows 13 Dec and 24 Dec that we could react lower to, bias up though. Target 1.6175-1.6200.

EJ - D close a doji at the resistance level. 4hr shows the reaction lower is getting smaller. Bias up but obviously can react to the proven resistance level.

EUR GU EJ 7 Jan

7 Jan

EUR - D, a hammer bounce off the RN 1.3000/support level. Below 50 RSI and price below its ma. 4hr on lower high lower low but has signaled a counter trend buy. 1hr has broken the lower high lower low flow. Conflicting messages so no real bias, a solid 1hr close either way could set up a move.

GU -  D, a negative close hammer off the support level 1.6000. Below 50 RSI price below its ma. 4hr lower high lower low flow, 1hr appears to have reverted back to lower high lower low. Bias down.

EJ - We are in the area (candle body lows from W chart) of the 2008/9 lows and the Jul-Nov 2010 highs. A major support/resistance level. D on higher low above ma but RSI did not cross its signal line. Asian session rejected the move up. 1hr flow up, bias up.

Monday mornings are often indecisive, perhaps will wait for US session to see if there is greater clarity.

Monday mornings are often indecisive, perhaps will wait for US session to see if there is greater clarity.

Counter trend - items to consider

If we are considering counter trend we want over whelming additional information to consider, such as:

- Proven support/resistance levels.
- W pivots.
- Divergence on higher time frames.
- Price action proving it does not want to progress for hours, double tops/bottoms , higher lows/lower highs, evening/morning star patterns, engulfing closes.
- Psych levels eg round numbers

In addition to the right kind of price action on 15 min, double tops/bottoms , higher lows/lower highs, evening/morning star patterns, engulfing closes.