Weekly Trade Commentary: 16th Dec 2012

Previous commentary: Commentary on 9th Dec 2012

Hi Readers,

The USD index made a complete turn around at the start of the week. Unfortunately, it didn’t move any higher than what I expected. Instead, it just tanked. As mentioned in my last article, we need to learn to switch our market views (read article) quite spontaneously. With that, I’ll resume my previous bias to short the USD.

The following is my watch list for the week:

(Click on image for Larger View)

  • EURUSD – The chart above is a weekly chart of this pair. The weekly price bar is now even more interesting as it closed as a very bullish bar (long body and small tails on both ends). It also formed an outside bar after decent High Test bar. In my view, this is a very strong bullish pattern because traders who took any short positions would have their protective stops at the top of the High Test. All these stops will eventually fuel the long positions when they are closed out.

To top it up, price made a pullback to re-test the weekly short channel (Green arrow) before a long continuation. The New long channel is still intact.

In line with the USD Index, my view has changed and my bias is now long. I’ll be waiting for a break above 1.315 and hope to find a pullback long entry (purple box).

  • USDJPY – As mentioned in my commentary last week, I’m looking for a pullback of the Yen and will be hoping for a long entry around 82.7.

 

That’s all for this week’s commentary. As mentioned previously, December is generally a thin market and I’m staying out of the market as mush as I can.

Thank you and Happy holidays if you’re taking an early start to the Christmas break.

 

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