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wide range swings lead to further rise

Posted on July 15, 2009 at 4:23 in Market comment, Market forecast, Operators' intentions by Dr. S. Sivaraman

EURO and GBP were making wide range swings yesterday during US session.A quick drop during start of late US session and a quick rise towards close.The players hit the stops of the buyers who bought during rise and then gained the levels after lightening their positions as well.

Today EURO and GBP are expected to rise initially and then dip towards close of Japanese session.They are expected to quickly gain levels during early European session to make quick drop and rise towards late European session.During US session they are expected to spike up to induce the short covering.

I will explain the intended moves for today during Asian session webinar: Live market analysis between 05:00-05:30 GMT

The link to register for the same is given below:

http://www.fxstreet.com/live/sessions/session.aspx?id=4795109b-feb1-412a-b45b-eae2000c34cb

Regards

Dr.Sivaraman

55 Responses to “wide range swings lead to further rise”

on 15 Jul 2009 at 4:37 am1glen

Thanks for your opinion.

Now that GBP has come back to the mid-point of the recent range, do you think it can overcome the important 1.6450 and 1.6550 levels today or tomorrow?

Regards,
on 15 Jul 2009 at 6:57 am2Dr. S. Sivaraman

Dear glen
we will see the mid level become support.There is shift in trading zone to higher level expected .
Regards
Dr.Sivaraman
on 15 Jul 2009 at 7:01 am3Rich

Can there still be room to the upside after a 100 move in EUR/USD. Logic says, No?
So the move now is to wait for 5-30 then go short?
on 15 Jul 2009 at 7:14 am4Rich

Do classic chart patterns and candlestick patterns work in forex? i,e. entering after climactic moves or shorting after double tops, etc…
on 15 Jul 2009 at 7:19 am5JAYDEE

Dear sir…do u think that gbp is gonna touch the 1.7000 n euro at .44 in this rally???
on 15 Jul 2009 at 7:26 am6Francesco

Good day Dr. Sivaraman,

I tought the spike we saw during late japanese session and gap time was a quick false move, then I though to short GBP at 1,6358.

EUR and GBP pushed more and quick to form new highs.

Now they seems to have a started a pullback, do you think we can see area 1,63 - 1,6350 during late european session?

Regards
on 15 Jul 2009 at 7:37 am7joshhh

Hi Doc,

They are hold UJ in tight range for last 3-4 sessions.

As you always say, they were holding this & did stop hunts in both upper & lower side. Now let see if it can still go up & give me my daily 40 pips or not.

This classic move is on my webpage

http://sites.google.com/site/ujforex/fear-of-trading-or-how-to-stop-loosing-money-

I am following your blog & started looking at market from a different point of view. thanks for your help & i am not feared by market now. i have stop using “STOP LOSS” but rather using 30 pips hedge. this has greatly benefited newbie like me.

regards

Joshi U.
on 15 Jul 2009 at 7:46 am8Pantani

Hi Joshhh

I am new to the blog and trying to understand the method.

If you have a moment ….perhaps you could tell me what the 30 pips hedge strategy is …. what instrument do you use for example?

Regards
Pantani
on 15 Jul 2009 at 8:02 am9Chris

Joshhh, Hello just had a look at your website. I use same marketscope,for intra break trades, after lots of experiments have finalised on this. MVA 7 and 20 with bollinger as overlay with overlay price of commodity pair (i use AUD/$) , then below in area. RSI 14 and CCI 14 last one CCI good to see for reverse (tops bottoms rapid moves)
try it out see what you think.
on 15 Jul 2009 at 8:05 am10Chris

Joshh just to add 5m chrt to get in 15m for running 60m for trend mva200
on 15 Jul 2009 at 8:59 am11joshhh

Hi,

I can see and understand only market when it is going up & still have to become expert in sell trade so i look for lower point to enter. (today i was filled in after 3 hours)& i put a sell position 30 points away from the recent (last session or last day’s low)Last time i entered at UJ at 92,70 & it went to 91.70 (4 hour chart stop loss hunt) so i put in buy order there & made 70 pips for the whole trade.

So trust DOC’s theory & look for general direction NOT what level it will achieve.

Regards Joshhh

PS: the trade is making 30 pips now so my stop order at entry & want to make 40 pips..hope there is enough momentum.
on 15 Jul 2009 at 9:25 am12Nazali

Hi Dr

When you talk of mid level becoming support is that mid level between the new daily high and the old daily high? Many thanks.
on 15 Jul 2009 at 9:41 am13Gregor

Dear dr. Sivaraman,

in case of USD/CHF - can we expect some more downward action this week? It seems to me mid 1.07 levels are good buying opportunities…

Kind regards,
Gregor
on 15 Jul 2009 at 9:41 am14su25

Dear Doc
According to your hattrick rule, Gbp should have a -ve net change today, as it posted a +ve net change for last 2 days. Is this correct?
Thanks and regards.
on 15 Jul 2009 at 9:55 am15su25

Dear Doc
And, when hattrick rule is applied to weeklies, previous 2 weeks net change for Gbp was -ve, thus this week should be +ve, therefore, the weekly closing should be above 1.6205?
If today Gbp has to close below 1.6305 to post -ve net change, then depending on price action tomorrow, one can do buy/sell with hedging orders on any dips?
Thanks and regards.
on 15 Jul 2009 at 9:56 am16Jimbo

su25, I asked DR the same question in the webinar today. He said that the hatrick rule does not apply on the net change.
on 15 Jul 2009 at 10:01 am17su25

Jimbo, thanks - did he elaborate on how it could be applied? I am confused now!
on 15 Jul 2009 at 10:11 am18Mohi

Dear Doc

How do you read when price is at mid level? For example, GU is currently at 1.6365 areas which is above the previous low but lower range of the current rise today. Is there any rule? Thanks and regards..
on 15 Jul 2009 at 10:21 am19Dr. S. Sivaraman

Dear Rich
Please check the levels during US session today and see how the market is known to make ill-logical moves.
There are limitations in candle stick studies as for as I have observed.
Regards
Dr.Sivaraman
on 15 Jul 2009 at 10:23 am20Dr. S. Sivaraman

Dear Francesco

Quick moves are false fear creating moves.Now european session would have explained your other question.
Regards
Dr.Sivaraman
on 15 Jul 2009 at 10:27 am21Ahmed

Respeted Dr,
thanks for replying my question regarding the hedging in the webinar.
All I wanted to ask is that in present market condition where there are 30/40 pips moves, 30 pips hedging order justifies risk/reward ? Should trading be avoided in these range bound conditions or hedge order be placed nearer?
Regards
on 15 Jul 2009 at 10:28 am22Dr. S. Sivaraman

Dear joshhh
we may have so many justifications for our trading decisions,but ultimately whether we made money or not is the question.So focus on your trades expecting the unexpected.Avoid the situation where the big players capitalize your emotions.
Regards
Dr.Sivaraman
on 15 Jul 2009 at 10:29 am23Dr. S. Sivaraman

Dear Nazali & Mohi

For simple understanding you can relate to Japanese session initial high as support as they have cut the high and formed new high.

Regards
Dr.Sivaraman
on 15 Jul 2009 at 10:37 am24travis

hi respected doc
what is meant by short covering?
thanks
travis
on 15 Jul 2009 at 10:37 am25Dr. S. Sivaraman

Dear Gregor

as you perceive the downside is limited to usd/chf.
Regards
Dr.Sivaraman
on 15 Jul 2009 at 10:42 am26Dr. S. Sivaraman

Dear su25
The hat trcik rule is they donot make similar moves for more than 2 sessions,2 days,2 weeks and 2 months.It does not mean they need to show after 2 days of positive net change they have to show negative net change.
Say they rise during Japanese and European session then slide during US session and slide during japanese session then rise during EUROPEAN and US sessions.A day rise in euro and gbp and another day rise in euro and gbp then 3rd day they drop initially and can rise again and again for 2 days.
Your second question:
imagine if they rise for 2 days and drop for 2 days - then the market can only be in a range.So please understand they have various types of moves and they normally donot continue the moves for more than 2 sessions and more than 2 days and weeks.
besides we will see this time higher shift in trading zone till end August.So we will see more rise and less drop moves.
Regards
Dr.Sivaraman
on 15 Jul 2009 at 10:49 am27Dr. S. Sivaraman

Dear Ahmed
If you try to take buy position near low or sell position near high when the high or low are not cut for more than 30 min.,then the hedging order can be only 30 pips as they mostly do 20-23 pips stop hunt and 30 pips will be safe.if your equity is good then you may use higher hedging spread like 40-50 pips.
Regards
dr.Sivaraman
on 15 Jul 2009 at 10:52 am28Dr. S. Sivaraman

Dear travis
some traders sell during drop thinking that it can drop more and then they buy against their lower level sell at a higher level when quickly the market rises.That is short covering - similarly some traders buy during rise and they sell their position at lower level fearing further fall that is long liquidation- the players make the moves in such a way to induce short covering and long liquidation alternatively from time to time.

SO AVOID SUCH EMOTIONAL TRADES.

Regards
Dr.Sivaraman
on 15 Jul 2009 at 10:58 am29Ahmed

Respected Dr,
Thanks for your reply.I am a small trader and have very limited equity :)I was asking whether hedging spread can be decreased to 15/20 pips or 30 is optimum
Regards.
on 15 Jul 2009 at 11:48 am30neil

at the end of euopean session now they are moving high and cutting high, how higher they can go today, as u told to Rich? thanks in advance
on 15 Jul 2009 at 12:02 pm31Rich

The Japan session ended higher, you forcast the Europe and U.S. sessions to end higher.
Doesn’t that violate the hat-trick rule. What am I misunderstanding?
on 15 Jul 2009 at 12:05 pm32jacob

Hey Doc

Is usd/cad still expected to rise after downmoves?
on 15 Jul 2009 at 12:27 pm33vinesh

doc they are now rising eu/dol but not usd/yen. Does this mean that we have see the end of usd/yen rise. will we see previus highs of 96, 98 anytime soon?
on 15 Jul 2009 at 12:32 pm34Dr. S. Sivaraman

Dear Ahmed

30 pips hedging is optimal- 10-15 pips they will invariably hedge freqyuently and you may become mentally tired.So try only safe trades.
Regards
Dr.Sivaraman
on 15 Jul 2009 at 12:37 pm35Dr. S. Sivaraman

Dear Rich
You comepare yesterday move with today in relation to timings in GMT.
yesterday they rised during japanese and european and then made the drop during US session and then rise towards close.
Today they rised during japanese and European session.You watch the moves towards close of European and US sessions - you will find the difference.
they dropped most of US session yesterday and rised towards close.Today they are expected to drop during early US session and then rise .
Regards
Dr.Sivaraman
on 15 Jul 2009 at 12:38 pm36Dr. S. Sivaraman

Dear jacob
yes but the patience will be tested.
Regards
Dr.Sivaraman
on 15 Jul 2009 at 12:39 pm37Dr. S. Sivaraman

dear vinesh
they will alternatively focus on different pairs- they focus more on numerator currencies as the volume is high and earning potency is also high.
Regards
Dr.Sivaraman
on 15 Jul 2009 at 1:14 pm38Jimbo

Hi Doc, do you think we will cut the high for the season ?
on 15 Jul 2009 at 1:25 pm39Tarun

hello dr, how do eur , gbp and usd/yen react to FOMC ?
on 15 Jul 2009 at 1:32 pm40Ahmed

Thanks for taking out time to reply my querry.
Regards
on 15 Jul 2009 at 1:38 pm41Mohi

Dear Doc,

Excellent webinar, forecast here today as always. I can imagine how difficult this can be. Thank you for all these you are doing for small scale trader like me. It is very much appreciated.

usdchf has been swinging 1.075 - 1.09 area for a long time. Is it about to move up soon? Thanks again…
on 15 Jul 2009 at 1:46 pm42johnra

Dear Dr
Thank you for clearing up the confusion with regard to the hat trick rule.Your comments in 26 have sorted the matter.
Also su 25 and Jimbo (I was also present this morning at the webinar)for raising the issue in comments 14, 15 and 16.Thank You.
Kind Regards
on 15 Jul 2009 at 2:15 pm43Constantin Lucian

Hello Dr. i noticed that you said that we should see shift in trading zone in eur and gbp. In an answer to a question of mine this month you said that we can see between july and September 1.37/1.35 - 1.43/1.45 in eur and 1.60/1.58 - 1.66/1.68 in gbp. Just to know from now on we can see higher levels right? so a short around 1.45 in eur or 1.68 in gbp will not be a wise or safe trade (swing or position trade)?
on 15 Jul 2009 at 2:23 pm44Greg

Nice analysis Doc.

Is there anyway to get a recording of these webinars?
Realistically I cannot make 05:30 GMT as I live in Europe and get up at around 06:00 GMT to go to work. I have a mobile device to keep abreast of the mkt on the move. Even if by the time I listen to the webinars the info is past I think they would be educational. I understand if a recording is not possible but thought I would inquire.

Thanks and Regards,
Greg
on 15 Jul 2009 at 3:50 pm45Arun Kandyal

Hi Dr
I believe players holding gbp 1.6450 area and swing in narrow range during us session in order to stop hunt either ways so that traders make distress trades. do you thing it wise to take sell buy position with hedging order at this level or wait for drop to buy or rise to sell thx

Regards
Arun Kandyal
on 15 Jul 2009 at 4:17 pm46Francesco

Good day Mr.Sivaraman,

I was lucky to close my shorts on GBP without losses on a quick pullback during european session.

EUR and GBP have been rising for 3 days, do you think we will see a real pullback in the last two days of the week?

My compliments for the very accurate forecasts this week!
on 15 Jul 2009 at 5:14 pm47Dr. S. Sivaraman

dear Jimbo
expected.
Regards
Dr.Sivaraman
on 15 Jul 2009 at 5:20 pm48Dr. S. Sivaraman

Dear Tarun
Before FOMC minutes EURO and GBP are expected to dip and then rise after .USD/YEN is expected to swing and rise.
Regards
Dr.Sivaraman
on 15 Jul 2009 at 5:22 pm49Dr. S. Sivaraman

dear Mohi

Thanks.USD/CHF is expected to swing and rise like usd/yen.
Regards
Dr.Sivaraman
on 15 Jul 2009 at 5:24 pm50Dr. S. Sivaraman

Dear Constantin Lucian
Market means swings.It cannot stay in any range for longer time.It will go up above the range and come down as well.The timing I will give when we are near the event.
Regards
Dr.Sivaraman
on 15 Jul 2009 at 5:27 pm51Dr. S. Sivaraman

Dear Greg

I will also be presenting for European viewers this time twin webinar - Tracking the forex market together part I and II-08:00 & 12:00 GMT on 17th Jul .You can register for the same and learn.
Regards
Dr.Sivaraman
on 15 Jul 2009 at 5:28 pm52Dr. S. Sivaraman

Dear Arun Kandyal
Buy after drop could be safe and easy trade.
Regards
Dr.Sivaraman
on 15 Jul 2009 at 5:29 pm53Dr. S. Sivaraman

Dear Francesco

Thanks for the compliments.
This time we could see further rise as market surprise.
Regards
Dr.Sivaraman
on 15 Jul 2009 at 7:01 pm54jacob

HI Doc

usd/cad continues to fall hard, patience for rise is one thing but this pair giving alot of quick moves down that seem like buy but then quick move again, strange action
on 16 Jul 2009 at 3:03 am55Dr. S. Sivaraman

Dear jacob
yes like they did in USD/YEN and USD/CHF now quick drop in USD/CAD to handle the crosses and then reverse from today.
Regards
Dr.Sivaraman

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