Profit Taking on Bearish Signal

BLOG UPDATE, 05:00 AM EDT 06/11/12

I closed half of my position @1.2571, it is a 74 pips winning trade. As I mentioned earlier(below on the blog) in the day I will monitor the market to take the decision for the position left. However I think the 4hour 20 MMA @1.2543 will be a good level to exit.

Now the question is to know if EurUsd will fill all the opening gap of this day or resume his uptrend.

Good trading!!!

Bearish Divergence Spotted on the 2H Chart

EUR/USD 2 Hour Chart , 01:00AM EDT 6/11/12

Hello buddy,
We spotted a bearish divergence on the EURUSD 2H Chart(on the 1h also), and we also have a huge opening gap due to Spain demands for bailout and data release from China, boost the Asian markets and risk appetite.                                                                                                                   

EURDUSD made new high on the week opening while the stochastic did not  do the same on the 2h chart. Moreover the gap push the price ine the zone 1.2670-1.2640 which is delimited by the monthly pivot and the daily second resistance chart.
Another point the pair is on the top of the rising trend channel.

We can easily say in this this configuration that technically we have solids arguments to think the pair will fill the gap.

My trade idea: Short the Euro @ 1.2645. I will place my stop @ 1.2675 (yes I know it is tight).
My profit target is on the first daily resistance @ 1.2571 which turn out in this situation as a support, I will close half of my position at this point and will monitor the market to take the decision (update will coming on the blog).

Good Trading !!!                                                                      
                                              

Fitch warns USA credit rate

Ten months after the downgrade by Standard & Poor's of USA credit rate, Fitch, the London based credit agency warns United States about a possible credit rate cut in 2013. In his statement, the agency mentions that there is not a credible plan in the US fiscal policy to reduce deficit. you can watch the article on Reuters.

German Bank Moody's downgrade, Is there a opportunity to short Eur/Usd?

The avalanche of downgrade by credit rate agencies have take another level today by the downgrade of six German bank and their subsidiaries following those of  prominent Austrian bank.

We have to notice that the two countries have a triple A credit rate and German economy seems safe since the beginning of the euro crisis.
These news bring more more turmoil on the already trouble water of the Eurozone.
we can watch a good article about the downgrade on ZeroHedge.

And now to come to the field of forex, these downgrades bring a fundamental support to the resume of Euro downtrend that we observe today after a counter-trend rally on Friday and Monday.
I will wait for a clear candlestick bearish signal on the 2h or the 1h chart preferably in the 1.2470-90 zone to enter in a short trade. So I Sell Eur/Usd @1.2480 and place my stop @ 1.2520.

Good Trading!!!

Took profit on my Eur/Usd Short (140 pips win)

I closed my EURUSD short trade after a 140 pips gain. Still think that the pair could go lower but it is enough for me for today and also because Eur/Usd reach the 1st intra-day support. You can watch the advice I made today below on the blog at 08:00PM EDT.

Bearish Divergence spotted on the EUR/USD 4H Chart (6/5/12)

EUR/USD 4 Hour Chart , 08:24PM EDT 6/5/12

 
Friday and today, EUR/USD made a rally which is a short-term countertrend of the strong downtrend of the Chart which took place in May.
However we spotted a Bearish Divergence signal on the 4h Chart (price made lower high while stochastic made higher high). Is it an opportunity to sell the rally? Fundamentally we know that the Eurozone is in a pretty bad shape and even if the US economic is not sleek too, the Euro have more troubles since Greece is maybe at the brink of a single currency exit.
My idea: sell on the daily first resistance at 1.2545, stop at 1.2585.
Note that it will be important to wait for a formation of a good candlestick signal before enter in the trade.

Good Trading!