Forex

What a day!

Unbelievable! I've been stopped out on my EURUSD short @ .5666. This, after watching EURUSD touch just above .56 just over an hour ago. I saw the drop and moved to place my SL early, it being Friday and all that ... So from +60 pips to -6 pips in next to no time. 1 down, 1 to go ...

Simply unrealistic market, and disordered moves completely.

GBP losses more than 200 points and euro holds on every pip on the all-time high.

No comment, but gbp already posted the outside reversal candlestick. That's it coming then.

I mean; the extremely overbought currency lose close nothing and a regular reading currency losses more than 200 pips but looks not enough to push eur/usd down.

This is pissing me off since no one wants to take profit even on friday. But its ok, I still insist that euro is coming to a major top and they won't stop me out "stoploss free from here"> The market can try higher as it like

Euro bulls are in denial, lol. This seems typical of large euro rallies when they end. They keep extending under divergent momentum pulling it down. Then one day, as a total suprise, it reverses 100+ pips and doesn't stop. The divergence now between the GBP and EUR against the dollar may also be a good signal of the chaos and irrational behavior that occurs at bottoms/tops of long trends.

Dollar bulls hang in there, we're almost there.

I am not in denial!

I am a EUR bull, but if it breaks down, I will be selling too.
Its just that i choose a different entry point then you do. You are right in saying its way overdone, from a technical point of view. But for now other laws seem to apply. There are so many dollar assets around the globe..... when they sell just because they HAVE to sell (margin calls, nervous brake down, limits exceeded) they wont look at techs. They just sell. MAYBE thats the sort of market we are in now. And MAYBE, on Monday morning dollar will be 300 pips higher and bid after some sort of G10 statement saying this and that. Strange days. Anything can happen.

All the best

I apologize if you took some offense to my comment. Sometimes without seeing or hearing the tone of a comment someone makes it's hard to understand how the statement was meant to be taken. I was basically joking around when I said euro bulls were in denial and I tried to express that with the "lol" after I wrote it. I've been shorting small positions since 1.5380. The market is always right so denial, whether it exists or not, is meaningless. I was just trying to make a jest as to why the market was not moving in my direction. Sorry again if I offended you.

my positions at the moment are range off momentum. Ive been long and short. Friday after seeing the hourly take a big push from 1.55454 to 156500 and stay above 156 to the close I waited for a dip. I bought at 1.56380 and have two limits at 1.56892 just 50 pips each. That because I hear you and am trying to be carfull. I figured that fresh highs will hit more than once and being just below with the strong run up at the end of trading I hope to limit out right away on sunday. Ill be at my station just incase. I will put the stops at even first thing now only willing to take one surge at open. If not I will sit back and watch the charts form what they may and make a desition based on paterns of the day. I have no idea were this is heading so unless there is big volume south Ill make smaller short term trades boath ways. If the trend is strong I usually risk a bit more. I origanaly had my limits set higher in the 1.5712 range but do believe that 157 may take some sicology to get threw. The trickle down effect of the USD will cary some what into Canada so I have a simuler postion EUR/CAD also. A bit tighter though. Ive spent most of the day studing the DOW against the TSX from a down turn perspective. They are faily evenly matched in this respect. Both taking 4 years to recover. The DJIA went from 12000 to 7000 from yr2000-2004. This new trend started in 2007 from the highs. The only differance this time is the state of the economy is worse. So were do I see the DOW and the relation to this and the USD? I do know thats when the EUR came to be in 2001 and hasnt looked back even after the DOW recovered to 12000 again. If you look at a weekly chart from 2001 the rsi on strong up trends is 76 most always at the top and we are at 72 right now on the weekly in the second or third bigest move since 2001. 160 is a tick away buy these mesurments given only the begining of the down trend for the DOW. Like I said this is just my theory. But given the strength over the years since 2004 of the USD and the EUR still pressing I have a hard time thinking a major down trend in this pair is near untill the DOW reaches 7 or 8000 and climbs back to at least 10000. I see this taking a few years with best efforts. Or maybe like every one else if ya cant beat em join em will hapen and the EUR will be the curancy the USA has in there fedral reserve fund? Naa that makes way to much sence. Im short or long what ever the flavor of the day is at this point. I some times sit hear for 20hours a day taking nap breaks during the day. I find the best times at night to trade just before London opens and an hour or two after that. Sunday will be interesting to see what direction were heading. Nice thing about sunday I though before staying in which I normaly dont do!! Is that the open will see mostly overseas buyers that favor the EUR and would have last seen the DOW and all NorthAmerican indexes down from FRI and a surge during these hours in this pair even after the Bushes talk. ill see how that stradagy boads tomorrow?EEEK!

I'm glad you bring up the other side, the fundamental side. I personally rarely consider nor trade based on fundamental data so my analysis may not be much use to you, and that's understandable. I personally believe that people and crowds move the markets, and therefore crowd psychology and sentiment ultimately tell us where the market will go. Elliott Wave Principle states that there is a distinct pattern in these moves. With that in mind, we're in the final throws of a large wave 3 which means dollar capitulation should rule the day. Many things you say, along with the daily barrage of horrible news feeds hammering the dollar and hoisting gold just contribute to the fact that the dollar is forming some sort of bottom because sentiment is at an absolute extreme low. I believe that once something is beaten to a pulp and it's lying there bloody and unconscious and no one wants it...............that's when it's time to buy it!

Also, the dollar is about to embark on a large 4th wave rally which is at the end of a long wave 3 decline so the move would have to come as a big suprise to the large majority who will get caught trying to continue riding that wave 3. I respect your viewpoint, and in the long run that will rule the day as I see the dollar continuing much lower in the long term. But for now, dollar is oversold and needs to recover and should gain over 1000 pips against the euro soon. I know it may sound like I'm blowing off the specifics of your question, but I purposely block out the details of the fundamental issues surrounding the dollar. I personally just don't find much use for them as what's really important to me is the "crowd's reaction", and that can only be seen in the charts and EWP.

With that said, I'm looking for a dollar bottom. Perhaps a sharp reversal can occur today, however it might happen next week when surrounding the Fed meeting.

But it's coming.

What's your view of the near term for the dollar against the euro? Any price targets?