Currencies are Breaking Out

As 2009 officially gets underway with the 1st full week of trading - the currencies are displaying “unusual” correlations - or the lack there of. For example:

UK Pound Rallies vs The Dollar

While the Euro Breaks Down Against the US Dollar

While the US Dollar Appreciated against the Swiss

The USD-CAD Dropped to a new Support Level

So the above shows that the US Dollar is  by no means moving in the same direction. The current variations of correlations are not acting in traditional ways - this suggests to me that more volatility is likely on the way.  

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Jerry Furst  is an active trader, educator, and Founder of Investors Education Network (IEN), He is a Mentor and Trading Coach to Select Clients  Click Here for a Free Self Evaluation Survey.

Holiday Greetings to All - The Calendar is light this week - as it should be - and to give the volatile markets a much needed rest and break - but will the volatility calm down as the banks and corporations around the world turn off the office lights? A Happy Hanukkah to all celebrating the festival of lights.

Light News Calendar

There are several GDP Reports scheduled to be released for the US, UK, Canada, and New Zealand. Will the numbers really be a surprise to anyone if they come out a bit worse than expected?

Tuesday will have the UK GDP released at 4:30 EST and can serve as a heads up as to the volatility for the US GDP at 8:30 EST.  Other news on Tuesday for the US include Consumer Sentiment, New and Existing Home Sales Data, and Investor Confidence all coming out at 10 EST.

Wednesday has Jobless claims- Durable Goods - and Personal Income and Spending Data also clustered at 8:30 EST. The EIA will release both Petroleum and Natural Gas data on Wednesday to accommodate the Christmas Holiday on Thursday.  Canada releases GDP data at 8:30 on Wednesday.

For more scheduled news events … Check out my consolidated event calendar and

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Jerry Furst  is an active trader, educator, and Founder of Investors Education Network (IEN), He is a Mentor and Trading Coach to Select Clients  Click Here for a Free Self Evaluation Survey.

Euro Dollar Give and Take

EUR-USD 4 Hour Chart (click to Enlarge)

In one months time the Euro ran up approx 2300 pips and on Friday gave back over 800! This after the Euro fell from the 1.4800 range from September 22 to make lows around 1.2300 back on October 27 - These are amazing one month moves!

Monthly Charts Show the Picture

Pound Gets Pounded - Falling Hard  

Above: EUR-GBP Monthly (Click to Enlarge) : Euro - Pound Screaming Towards Parity!

Canadian Loonie Analysis Trend Continues 

USD-CAD 30 Min Charts (click to enlarge) The Down Trend Channel continues - Charts from Dec 15, 16, and 19th show the progression

Bens Last Hurrah?

After Tuesday’s meeting - The next scheduled FOMC meeting is January 28, will there be a new Fed Chairman at the helm, or will Bernanke be held over? Will there be any more rate cuts available at that time? There are expectations that rates could be lowered to 0.25% - making the US rates even lower than Japan.

The Dollar Continues to Give Up Ground

AUD-USD 30 Minute Chart (Click to Enlarge)

Continuing Up Trend Channel

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Jerry Furst  is an active trader, educator, and Founder of Investors Education Network (IEN), He is a Mentor and Trading Coach to Select Clients  Click Here for a Free Self Evaluation Survey.

Chart Pattern Review - 48 Hours Later 

Two days ago I posted several charts showing some nice chart patterns - indicating to me a 

consolidation was ready to breakout and I labeled the post “Pause Before the Storm” 

Let’s look at the charts side by side now.

 USD-CAD 4 Hour Chart — 300 Pip Triangle Break Out (click to Enlarge)

 EUR-USD 30 Min Chart — Over 400 Pip Trend Channel Break (click to Enlarge)

USD-CHF 2 Hour Chart - Triangle Break - 200 Pips (click to Enlarge)

The above charts are great examples of waiting for High Probability setups on multiple pairs

all setting up at the same time.

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Jerry Furst  is an active trader, educator, and Founder of Investors Education Network (IEN), He is a Mentor and Trading Coach to Select Clients  Click Here for a Free Self Evaluation Survey.

Dec 9, 2008 - Pause Before The Storm?

“Show and Tell” on Chart Patterns

Lot’s of Chart Patterns are Currently Forming on the Currencies - A brief discussion and then a look at some good examples of Triangle Patterns all setting up at the same time on different time frames.  

Furst -  let me give you my “two Ameros” on chart patterns. I consider them all to be “consolidation patterns” and have no bias that - for example,  an “ascending triangle”  is a “bullish pattern” - to me,  it could go in any direction. What I look for is the strength of a well formed pattern.

Is it well formed? 

If I can show people a chart and everyone quickly recognizes a Head and Shoulder Pattern, that’s a strong signal. If there is lot’s of debate - then it’s weak.  Chart Pattern recognition gets fun when you see a pattern forming at the right edge, but not yet completed. Aggressive traders can take a position that the pattern will first form - and then if it does, prepare for the potential price targets.

Don’t Get Bogged Down In Statistics

I debate the statistics some apply to chart patterns. For example: Maybe someone tested 1085 head and shoulder patterns and determined that  83.7% have a probability of completion in a certain circumstance.  So what! The 16.3% chance is just another “50-50″ coin flip if you are only looking at statistics. Well - let’s just say that I can disprove anything with statistics..

US Dollar - Canadian - Dec 9, 2008 - 4 Hour Chart

USD-CADVery Strong Triangle Pattern forming on the Dollar - Loonie. Note the multiple areas where the upward trend Channel has held - and the Resistance forming a classic Triple Top. (click to enlarge)

Euro - US Dollar Daily Chart - Dec 9, 2008

EUR-USD: No Shortage of Chart Patterns Here as we have a pretty good triangle pattern, with a consolidation zone inside. Note the Upward Trend Channel that will be brought into focus on a 30 Min chart Below

EUR-USD: 30 Minute Chart of EUR-USD Shows the Upward Trend Channel and Resistance Levels  (Click to enlarge)

US Dollar - Swiss

USD-CHF: 2 Hour Chart Dec 9, 2008 - Nice Triangle to complement the Euro-USD Pattern (Click to enlarge)

Aussie - US Dollar - Dec 9, 2008 4 Hour Chart

AUD-USD - 4 Hour Chart - Yet Another Triangle! - (Click to enlarge)

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Jerry Furst  is an active trader, educator, and Founder of Investors Education Network (IEN), He is a Mentor and Trading Coach to Select Clients  Click Here for a Free Self Evaluation Survey.

What Now!

Last week I went fundamental - and with good reason. There was more news than I could keep up with - scheduled or otherwise. This week I will stick to the charts - unless if we get some major fundamental issue - like Charlie Gasparino deciding to drive some poor equity into the ground. Bottom line - be ready for anything in this enviornment!

Euro in The Box - Nice Consolidation Zone

Dollar Swiss Continues in Uptrending Channel

Usually the USD-CHF is a Mirror Image of the USD-CHF, however the status quo seems to be in question as the continued Dollar strength against the Swiss is not dargging the Euro down - for now…

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Jerry Furst  is an active trader, educator, and Founder of Investors Education Network (IEN), He is a Mentor and Trading Coach to Select Clients  Click Here for a Free Self Evaluation Survey.

by Jerry Furst Sr. Analyst

Investors Education Network.com  

  On Monday the NBER (National Bureau of Economic Research) “determined that the decline in economic activity met the standard for a recession” and that it started in December of 2007. I find it audacious that pundits on TV now make statements like “We all knew it was a recession” - When in fact the media was trying it’s best to keep the rose colored glasses on. Back on Jan 22 my blog post was titled, “Recession in Play – Depression on the Way?”

  Also on Monday – Ben Bernanke warned that, “it’s certainly feasible” to cut rates further – thus giving the other central bankers a heads up to act accordingly. The Thanksgiving Day stock market shoppers were treated to a deep discount as the DOW plunged 679 points or -7.7%! 

 Tuesday – The markets took a breather – there was not much news and it appeared as if people were waiting for Wednesday’s data. The US “Big 3” automakers were reported to have their CEO’s driving to Washington,  and the UAW is under pressure to renegotiate it’s 2007 concessions.

 Wednesday – The EU reported poor retail sales and the UK and EU both posted dismal numbers for Services PMI – dropping the Euro around 100 pips and the Pound over 200 pips before the NY session.

 The US then got in the game and posted horrible Non-Mfg ISM numbers and the ADP jobless claims came in at -250,000 where expectations were for -200,000. The Feds Beige Book came in negative as well.

 As of this writing New Zealand is expected to cut rates from 6.5 to 5% at 3pm Eastern time.

 Thursday – Interest Rate and Trichet Watch

Which leads us to the home stretch – as the UK is expected to cut rates from 3 to 2% and the Euro Zone is expected to drop rates from 3.25% to 2.75%. These are big and historic drops in size and in the rate itself. Jean Claude Trichet is scheduled to have his press conference at 8:30 am EDT in which he usually gives some clarity as to where he sees things are – and what the ECB may or may not do in the near term.

 Friday – All eyes are waiting on the Non-Farm payroll report – but will the unemployment rate really be a surprise? Will their be revisions?

 Stay Tuned… 

 The Week Ahead Calendar and Webinar - Click Here

Jerry Furst  is an active trader, educator, and Founder of Investors Education Network (IEN), He is a Mentor and Trading Coach to Select Clients  Click Here for a Free Self Evaluation Survey.

To see my Jan 22 – Blog Post “Recession in Play – Depression on the Way? “

http://blogs.fxstreet.com/1stonforex/2008/01/22/recession-in-play-depression-on-the-way/