Midpoint of weeks high low ranges tested in $EURUSD, $GBPUSD, $USDJPY and $USDCHF
The dollars moves in NY on the back of the stock markets rally from lows on the opening brought the major currency pairs back to the midpoint of the weeks trades. The levels seems to have slowed the momentum of the corrective moves this morning and may have set tops/bottoms in the respective pairs.
The EURUSD tested the 50% Retracement level at the 1.4986 level. Support comes in at hte 1.4949 level now where 200 hour MA (green line ) and 38.2% retracement is found.
The GBPUSD tested the 50% retracement level at the 1.6507 level. Support comes in at 1.6451 now.
The USDJPY tested the 50% retracement at the 86.98 level. Support comes in at 86.47 now for the pair.
The USDCHF tested the 50% retracement at the 1.0057 level. Resistance comes in at 1.0074/76 and 1.0090 now.
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Greg,
I have hypothetical question regarding moving averages. On an 1 hour chart, the price is 1.5000, the 100 MA is at 1.4950 and the 200 MA is at 1.4925. Your said in your commentary that the price must break the 100 MA the then break the 200 MA to confirm a move to the downside. This theory I understand.
On the flip side, with the price still at 1.5000, but the 200 MA at 1.4950 and 100 MA at 1.4925, will the market continue in an upward trend until the 100 MA can get above the 200 MA? Or does it not matter which moving average is above the other to see the price move to the downside?
Thanks
if 100MA > 200MA and price is below 200 MA and crosses back over 200MA – I would expect this to be a consolidation type-move.. as it didn’t continue downward.
But if 100MA> 200MA and price is testing 100MA that’s a short signal. and the opposite is the long signal. Take your profit and go. = )
As long as the price is above the 100 hour MA and the 200 hour MA, the bias is bullish. If, however, the price breaks below the 200 hour MA, the bullish bias is a little tarnished. WHy?
If the market trades above the 100and then the 200 we should see a continuation of the move higher with momentum. If we don’t we head back in between the goal posts and a move back to test the 100 hour MA is likely. If you are watching the 5 minute in conjuction, the bias is probably bearish if this happens.
The progression of steps is break the 100 hour, look for the next target which is often the 200. Break that. Now we are onto something. Look for the the next momentum move. If it does not come, and the price comes back down in between the goal posts, don’t be surprised to see consolidation back to the 100 hour MA.
Also if you are watching the 100 hour MA and trade off of its signal, and then the price goes through the 200 hour MA, often you need to transition to watching the 5 minute chart for the corrective clues. The reason is the 100 hour MA will lag once the price starts on a momentum move in the direction of the break. This is good for you but corrections can hurt too. So if you then watch the 100 bar on the 5 minute you can often protect against corrections too.
It is a rhythm of a trade that is the hardest but if you catch on, you will really get it….
I hope this helps…
Greg